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Families on food stamps would suffer while farms get fat

Bills inching through the House and Senate would hack away at the food stamp program, yet protect — or even expand — farm subsidies.

June 14, 2013|Michael Hiltzik

Even with categorical eligibility, enrollees still have to undergo a burdensome application process. "Qualifying for SNAP requires a fair amount of time and disclosure of your income and circumstances," says Dorothy Rosenbaum, a SNAP expert at the Center for Budget and Policy Priorities. "States are not certifying lots of people who aren't eligible."

But this is a standard attack on relief programs: If you can't kill the program, discourage participation. Just last year, conservatives in Congress pitched a fit upon discovering that the USDA had actually launched an outreach program to get eligible people signed up. Sen. Jeff Sessions (R-Ala.) complained that the USDA's goal was "maximum registration," as if a government program designed to help the needy should be kept secret, like the NSA.

My guess is that it would be hard to find many U.S. farmers who don't know to the last thin dime what they're entitled to in crop subsidies. That brings us to that piece of the farm bill. Rep. LaMalfa's office grouses that totting up his farm's take in the past is unfair, because the House and Senate farm bills both eliminate the $5-billion direct payment programs from which he collected. "Rep. LaMalfa voted to end [these] very programs," a spokesman says.

That's a neat bit of legerdemain. It's true that direct payments would be eliminated by both bills. But they'd be replaced by new programs that could be even more lucrative for the same farmers. Who says so? Among others, the reliably conservative American Enterprise Institute, which cast a spotlight on the bill's "price loss coverage" and crop insurance provisions, and termed the whole thing a pack of "fake savings."

The price loss program will guarantee that farmers receive no less than 90% of a benchmark price for wheat, corn, rice and many other commodities. The scam is that today's prices are historically high — the benchmark for rice, which sold for an average of 7 cents a pound from 1996 through 2006, was set at 14 cents in the bill filed in the House on May 13. For japonica, the premium rice grown in LaMalfa's Butte County and elsewhere in California, the benchmark is more than 16 cents.

The AEI says that if prices moderate toward pre-2007 levels, the cost of this program will explode; its potential cost is $18 billion a year, or almost four times as much as the supposedly wasteful direct subsidy program it's meant to replace. (This is how Congress "saves" on corporate welfare: through fakery.)

"The new target prices are set so high that they're very likely to be triggered," Scott Faber, vice president for government affairs at the Environmental Working Group, told me. "It's a bait-and-switch — both houses are taking savings from direct payments and plowing them into new entitlements."

The House proposal also enhances the value of government-subsidized crop insurance by guaranteeing that farmers of certain crops receive 90% of their average revenues, up from the current 85%. The government, by the way, pays roughly two-thirds of the premiums of crop insurance. Ask yourself: Does it do that for business insurance in your industry?

California farmers, as major rice producers, would be big winners in these schemes. I asked LaMalfa's spokesman how he'd fare under the new arrangement. He replied that "the congressional office does not communicate with the representative's farm." But he did indicate that it's important to "help keep farmers afloat" in difficult years.

That's true of ordinary working American families, too. The question for Rep. LaMalfa and his fellow food stamp hackers on the agriculture committee is: Why is it important for government to skip out on aid for families, but pony up for farmers like him?

Michael Hiltzik's column appears Sundays and Wednesdays. Reach him at mhiltzik@latimes.com, read past columns at latimes.com/hiltzik, check out facebook.com/hiltzik and follow @hiltzikm on Twitter.

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