Crop Insurance: Farmers and Taxpayers Investing in Food Security
May 07, 2013
Insurance is once again in the news and I don’t mean Obamacare. The debate over federal crop insurance is heating up as Congress attempts to write a new farm bill. Criticism of crop insurance is certainly not new. Over the years several reforms have been implemented but opponents still aren’t satisfied. Last year’s drought and the money paid out have made the program a target of renewed attacks. No government program is perfect so no one should expect this one to be either. Differences of opinion on crop insurance exist even within the ag community itself. However lost in the debate (especially in the media coverage) is the fact that farmers pay a lot of money to be in the program. This is not a handout from the government as it is often portrayed. Farmers pay those premiums not knowing if they will need the coverage or not and before last year many had paid into the program for years without filing a claim. Yes, government support is a big part of the program and some say it’s too big a part. Others contend it is essential to the success of the program. Good arguments can be made by both sides. However, let’s make sure we don’t throw the baby out with the bathwater and lose the key piece in the farm safety net. Some say it is hypocritical for farmers to want government to stay out of their business but want it to support crop insurance. That would be true perhaps if it was a straight handout but given the amount of farmer investment in the program it seems more like a business partnership. Government often proves to be a tricky partner for farmers but for the most part in this case it seems to be working. Given the current economic plight of the country and the makeup of an already dysfunctional Congress, I would hate to see us go back to the days of counting on the government for ad hoc disaster assistance. If it came down to a hurricane devastated city versus a drought stricken Midwest, I’m afraid agriculture would lose out. An investment in America’s farmers pays greater dividends than most people realize especially compared to the return on investment from many other government programs.