Is there a Raft of Rural Subsidies?


The ill-defined term “rural subsidies” is at the center of a debate between Washington Post columnist Ezra Klein and Secretary of Agriculture Tom Vilsack. See parts one, two, and three.

Klein refers several times to “rural subsidies,” once referring to the “raft of subsidies we devote to sustaining rural life.” But Klein does not explain what he means by “rural subsidies.” And when he quizzes Vilsack on what justifies subsidizing rural people, Vilsack doesn’t challenge him to unpack it.

That results in a critical gap in the conversation.

If by “rural subsidies” Klein means farm commodity subsidies, that should be isolated and taken head on. Klein is right to question and challenge the current structure of farm commodity subsidies. Current farm programs provide unlimited benefit to the largest farm operators.

It cannot be said, however, that these subsidies are devoted to sustaining rural life. In fact, the system is literally undermining the economic and social foundation of rural communities.

The subsidies accrue to only a small portion of the rural population. A 2007 report from the Center for Rural Affairs, Over Subsidizing and Under Investing, shows how badly skewed USDA investment is toward very large farm operators and away from investing in programs that build a future for all of rural America.

The report found that the USDA spent nearly twice as much to subsidize just the 20 largest farms in each of 13 leading farm states examined as it invested in rural-development programs to create economic opportunity
for the three million people living in 1,400 towns in the 20 most-struggling rural counties in the same 13 states.

Current policy encourages big farms to get even bigger. Fewer farmers means fewer people in rural America. As farms consolidate, the population in the countryside declines. As the farm population declines, small towns also decline as less farmers need supplies and services. Rather than sustaining rural life, the current farm commodity system subsidies the
decline of rural life.

All other USDA rural development programs combined (rural broadband, rural small business, value added market development, etc.) account for a mere a fraction of one percent of all USDA spending.

The Center for Rural Affairs is proposing a modest investment of $100 million per year for rural development in the 2012 farm bill. That would be a several-fold increase over current investment in non-farm rural development and would still represent less than one-half of one percent of farm spending allocated by the farm bill and one-sixth of one percent of total funding allocated by the farm bill.

In addition to attacks on the broken farm commodity system, it has also become popular to attack other investment in rural areas as unfair subsidies. Spending on roads in rural areas is a popular target. In a later post, Klein takes just that jab. But the argument there is not much stronger.

Certainly, we invest in roads located in rural areas. Those roads are used often by urban people driving from one urban center to another; the mere physical location of the road in a rural area says very little about who benefits.

We also invest in infrastructure in urban areas, including rather expensive airports, stadiums and rail lines. And there is an entire federal department dedicated to urban development.

But the entire debate quickly becomes vapid when viewed in these terms. I don’t begrudge New Yorkers or Chicagoans their infrastructure. And it does little good for them to begrudge my community’s basic infrastructure needs.

It is better to focus on the type of development and the sorts of values we should incentivize. We live in a nation that ought to invest in building strong communities and healthy and sustainable economies that benefit the people who live in them. Different communities have different needs.

Incentives that drive the consolidation of wealth and limit opportunity for everyday people ought be avoided. That is as true of farm commodity subsidies that accrue to people in rural areas as it is of misguided financial policy that enriches investors while leaving working class people in Philadelphia or Miami stuck in an unaffordable mortgage.

Incentives that create economic opportunity for everyday people and help us to become more sustainable ought to be supported and pursued. Again, that is as true of federal programs that support soil and water conservation on farms and wind power development in rural areas as it is of investment in mass transit it more urbanized communities.

In his final post on the topic, Klein expresses surprise at the debate his initial post has stirred. But it is not surprising. The underlying narrative that everyone should live in cities because that is most efficient or is what will make us richer or smarter is a neoliberal analysis that rests on too many unchallenged assumptions about what is best for people,
communities and our democracy.

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  1. Urban Agrarian
    Friday, March 11th, 2011
    Great Article and informative article.

    Along with the myth that cities are necessarily more efficient or the source high culture, we might also jettison the notion that rural communities are somehow morally superior or are inherently more American or democratic. Both myths are useful tropes of those seeking political division; they obscure the social, cultural, economic and ecological interdependence of cities and their surrounding rural landscapes.
  2. Sunday, January 15th, 2017
    It doesn't surprise me that Vilsack didn't try to "unpack" Klein's claims. I have never seen him as a true supporter of rural America or small farms. Maybe he doesn't feel it's his job. His job is agriculture, which could just as well be a factory farm or processing plant than say a co-op of family farmers producing food, often to be eaten locally.

    Rather than assuming anyone from the USDA will represent small farmers, these farmers should view themselves more as small local business owners - not unlike a store owner in a large metro area. Both face the same challenges - attacks from large corporations in collusion with government creating an unfair playing field.