Thursday, May 27, 2010

Peterson on Payment Limitation

Today's FArm Policy led with this:
The Washington Insider section of DTN noted yesterday (link requires subscription) that, “Shifting away from direct payments [related graph] would go a long way toward resolving the problem of farm payment limits, which Ag panel Chairman Peterson sees as the main reason for opposition to federal farm program. ‘A lot of the huge payment issues would go away if you don’t have direct payments,’ Peterson said. Direct payments, he says, are what generates ‘all the opposition because we make payments to people who aren’t farming [such as] people who own land [but] who live in New York City.’
I'm not sure I follow his logic.  Yes, there's a difference between saying Bigshot farmer got $X in taxpayer money and saying he got $X in taxpayer subsidized insurance indemnities, but it's not that big a one. Certainly it won't fool the smart people in the food movement, and I doubt their friends in the mass media.  Maybe I'm wrong--twill be interesting to see. 

I believe I'm correct in saying, as a general rule, the people who get indemnity payments and the people who get direct payments should be the same people: i.e., those who have an interest in the crop.  There may be minor differences in how the rules work and there may be major differences in the administration of the rules, but again we'll see.

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