If you are going to battle with a dragon, you’d better have some good ammunition. Many farmers have wished for that ammunition when they are confronted by the media or farm program critics who fire away with statistics that put agriculture in a bad light.

For most of us, we can only wish for a response that seemingly never comes. But coming to the rescue is a knight on a white horse from the distant land of Massachusetts, where farm program benefits are few and far between. But that doesn’t matter, when the objective is a fair fight on a level playing field, an objective which he shares with Corn belt agriculture.

Tim Wise is a specialist in public policy at Tufts University in Massachusetts, and he’s become concerned about the ricochet of misfired statistics which can wound good agricultural policy. He dispels a half dozen myths about agriculture that are not only heard often in discussions, but are in position to be building blocks for the 2007 Farm Bill.

#1—Counting part time farmers. Of the 2,122,524 (2003 data) farms in the US, Wise says 1.4 million are “are categorized by ERS as Rural Residence Farms. This is a heterogeneous group that includes “Limited Resource” farms, “Retirement” farms, and “Residential/Lifestyle” farms. The main characteristic unifying these three is that the heads of household on these farms do not list their main occupation as farming.” But of the 654,175 farmers who list their occupation as farming, Wise says 54% of family farmers and 67% of large commercial farmers received farm program benefits, which is much more than offered in criticisms by the Environmental Working Group of USDA. Wise concludes, “It remains true that the only farmers who are eligible for commodity program payments are those growing a limited set of most of the largest crops; these notably exclude fruit and vegetable crops. It is also true that these programs are highly skewed, with the largest farmers receiving a disproportionate share of the benefits. But they are not nearly as skewed as some suggest. It is false to suggest that the vast majority of full-time family farmers are excluded from federal farm programs. A significant majority receive such benefits.”

#2—Beware of misleading averages. Wise says the statistic that average farm household income is 118% more than average US household income is incorrect, since farm households includes those above, which are rural homes, but not necessarily farm households. Wise says households must be comparable, and, “small family farmers are the large majority of farmers trying to make a living from farming in the United States. Most of those had farm sales under $100,000. In 2003 they barely covered costs from their farming operations, and even with off-farm earnings they had incomes of only $49,435, (which is) 86% of the U.S. average (for household income).

#3—Look at off-farm income for what it is. Wise says many producers could not survive without off-farm income, but “if our goal is to evaluate the need for and efficacy of farm programs it is misleading to look beyond the farm.” Addressing the cost-price squeeze, he says, “Farmers as a whole have seen nominal prices for their products fluctuate a great deal but remain roughly the same as they were a decade earlier. Meanwhile, the prices they pay to run their farms have risen quite steadily, roughly at the rate of inflation.” As a result, “The majority of family farmers operate on the edge of viability, squeezed between low prices for their products and rising prices for their inputs. They stay above the poverty line by supplementing meager farm incomes with off-farm earnings. Off-farm earnings in effect subsidize farm operations for many farmers.”

#4—Land owners absorb many farm program benefits. Wise notes that “45% of U.S. farm land is rented, and the majority of agricultural landlords are not in farming. It has been shown that landowners capture a significant portion of the value of government payments in their lease arrangements with farm operators. Much of the value of farm payments is ultimately capitalized into land values, so farmers benefit more to the extent they own their land.” However he says, “With nearly half of U.S. farm land leased and not owned by the farmers, it is misleading to assume that farmers are the ultimate beneficiaries of farm programs.”

#5—Farm program payments parallel production capability. Wise says farm program payments should not be an isolated statistic. “U.S. program benefits are concentrated among the largest producers not because they have succeeded in capturing a disproportionate share of those payments but because they control a disproportionate share of the land and production in agriculture and most payments are tied to land or production.” And he adds, “The concentration of farm payments, in this context, is caused primarily by the concentration of land and production in the hands of a relatively small number of large farmers. It may be necessary to address the root causes of this concentration in order to meaningfully address inequities in U.S. farm programs.”

#6—Data on farm subsidies are misleading. Several years ago, thousands of farmers, who had lived in anonymity, were publicly identified by the Environmental Working Group along with the amount of farm program payments they received. Wise says even the EWG admits the data is not perfect. Wise says the EWG identified the top 20 entities receiving farm program payments, but none was an individual family farm. Eleven were corporations or partnerships, 5 were Indian tribes or groups, and two were cooperatives. The other two were a non-profit group and a conservation trust. Wise says, “While EWG states that only 40% of farmers got any payments at all, some 82% of these mid-sized family farmers received payments, and those payments kept them right around the U.S. average household income. Data from the most commonly cited source on farm subsidies suggests that the top 20% of farmers are getting an inordinate share of farm benefits. On closer examination, the top recipients aren’t farmers at all; some are cooperatives and Indian tribes, who share those benefits among their members; others are conservation trusts; some are corporations. These high payments to corporate farms may well represent an abuse of farm programs, but they are neither typical of farmers nor representative of a significant part of the farm sector.”

Summary:

Too often, agriculture is depicted in a bad light, due to public policy that is designed to ensure US consumers have an unlimited supply of high quality, inexpensive food. In return for participating in those farm programs, farmers become a statistic that can be easily skewed in any direction a critic may choose to travel. As the US embarks on debate on new farm policy, agricultural interests must ensure the statistics are used appropriately, and the taxpayer can understand the purpose and returns of US farm policy.

Stu Ellis