There is a study that suggests lowering the subsidy rate for high income farm operations could save taxpayers hundreds of millions of dollars each year.
There is a study that suggests lowering the subsidy rate for high income farm operations could save taxpayers hundreds of millions of dollars each year.
Transcript
Subsidies for crop insurance cost over $17 Billion for the 2022 crop year according to federal government statistics. But there is a study that suggests lowering the subsidy rate for high income farm operations could save taxpayers hundreds of millions of dollars each year.
The Government Accountability Office, an independent agency within the federal government, released a study this week that analyzed the costs of crop insurance subsidies to farmers and the payment of administrative fees to insurance companies that sell the policies. The report found that the top one percent of crop insurance policy holders received nearly 15 percent of the payouts made in 2022, coming in at a little over $2.5 billion.
Taxpayers subsidize an average of 62 cents for each dollar of crop insurance purchased. Unlike other agricultural programs, there are no income limits to access the insurance subsidy.
The report also estimated that reducing the subsidy for the operations in the top 1 percent could save over $15 million annually and have little effect on the actuarial soundness of the program.
Proposals to place income limits on insurance subsidies face a skeptical audience in Congress.
Sen. Charles Grassley, R - IA: “I feel that we shouldn't take any chances with hurting crop insurance, whether it's for big farmers or small farmers, because I'm hearing the same message from any size farmer we have in Iowa.”
For Market to Market, I’m Peter Tubbs.
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