By Candia Dames
WASHINGTON – Maryland farmers got $318.8 million in federal farm subsidies from 1996 to 2001, with 65 percent of that amount going to just 10 percent of the farms participating, according to newly released U.S. Department of Agriculture data.
The Environmental Working Group, which compiled the data, said the disparity in subsidies means struggling family farms are being left with less money to compete. That disparity needs to be evened out, the environmental group said.
“We would like to see more money going to the two-thirds of farmers nationwide who don’t benefit because they don’t grow a particular crop,” said Chris Campbell, who analyzed the data for EWG.
The federal subsidies are provided to farmers who grow any of the eight commodity crops: corn, wheat, rice, cotton, soybeans, sorghum, oats and barley.
But Maryland farmers and agricultural officials defended the subsidies as necessary, and said the fact that some farms get bigger subsidies than others merely indicates that some farms are bigger than others and have had bigger financial shortfalls.
“I don’t know if it says anything,” said Maryland Farm Service Agency Executive Director Steve Connelly, of the gap in subsidies. “I think those farmers had the most exposure because they’re running the largest operations.”
State officials stressed that the subsidies are helping to keep farmers in business.
“The misnomer is that these are welfare programs,” said Don Vandrey, a spokesman for the Maryland Department of Agriculture. “The non-farming public looks at these as free handouts to the farmers, but they are payments geared toward environmental needs and maintaining the overall economics of agriculture.”
The environmental group’s analysis of the data showed that 8,449 farmers in the state got $318.8 million from county agricultural offices during the six- year period.
Subsidies to the state grew from $17.6 million in 1996, when 4,861 farmers participated, to $86.5 million last year, when the number of recipients grew to 6,156. Nationally, farm subsidy payments tripled in the same period, from $7.3 billion to $20.7 billion.
The five-fold increase in subsidies to Maryland farmers is due directly to the fact that commodity markets have gotten progressively weaker since 1996, said Pat McMillan, a state assistant secretary of agriculture.
“Prices were strong in ’96. The intent was to let the global marketplace determine prices,” McMillan said. “But prices went south and it quickly became apparent that farmers needed these payments for their survival.”
He said the subsidy data, while “good information” is misleading.
“The data doesn’t tell you how much those operations had to spend in relation to how much they produce,” McMillan said. “In all the hullabaloo of this data, there is no context.”
Greg Gannon agreed. His family runs Cecil Gannon & Sons Inc., a 2,200-acre Easton farm that got $740,000 in subsidies over the six years, $223,000 last year alone.
Gannon said that money is not enriching farmers, but is ultimately going to pay the agribusinesses they support, like tractor dealers, Gannon said.
Four farms in Maryland — Pleasant Valley Farm, Harborview Farms, Pcn Farms and Hunt Ray Farms — received at least $1.1 million in government subsidies over the past six years.
Six farms got subsidies more than $275,000 last year, with Harborview Farms in Rock Hall getting $569,000.
Farmers say that without the subsidies, the price of food in America would skyrocket. Farm payments ensure that Americans pay a lower cost for food proportionate to their income than other countries in the world, said Kenneth Bounds, vice president of the MidAtlantic Farm Credit, which provides loans to farmers. While Americans spend 10.9 percent of their income to eat, Germans spend 17.3 percent, Israelis 20.5 percent and Indians 51.3 percent, he said.
“Subsidies are designed to bridge the gap between the cost of producing crops and commodity prices on an open market,” Bounds said. “In a perfect world, an open market should dictate the price but that’s not been the case because of foreign competition and other factors which have caused commodity prices to be below break-even.”
But EWG argues that subsidies actually increase the price of commodities by driving up the cost of the land.
Campbell said subsidies support mainly large farms, increasing the demand for land. He said the end result is that small farmers cannot compete and end up selling their operations to corporate farmers.
EWG believes the government should limit the amount of money it gives to any one farmer, in an effort to steer some of the money away from large farms. The Senate has proposed a cap of $275,000 per farm on the farm bill, which is in conference committee now.
But the idea of a cap does not sit well with Bill Malkus, whose Blackwater Farms Inc. got $258,000 in 2001 and a total of $887,000 over the past six years. If Marylanders want to eat cheap, they have to pay the cost, Malkus said.
“It seems unfair for there to be any type of limit,” Malkus said. “Most everyone I’m talking to these days who’s farming says these payments are what’s keeping them going.”
