A Depression-era program intended to save American farmers from ruin has grown into a 21st-century crutch enabling affluent growers and financial institutions to thrive at taxpayer expense.

Federal crop insurance encourages farmers to gamble on risky plantings in a program that has been marred by fraud and that illustrates why government spending is so difficult to control.

And the cost is increasing. The U.S. Department of Agriculture last year spent about $14 billion insuring farmers against the loss of crop or income, almost seven times more than in fiscal 2000, according to the Congressional Research Service.

The arrangement is a good deal for everyone but taxpayers. The government pays 18 approved insurance companies to run the program, pays farmers to buy coverage and pays the bills if losses exceed predetermined limits.

With a showdown over the nation’s finances -- and a possible government shutdown -- looming this fall, the growing insurance tab is a bipartisan target. President Barack Obama sought this year to cut almost $12 billion from the program over the next decade while his ideological opposite, Republican House Budget Committee Chairman Paul Ryan, has called subsidized insurance “crony capitalism.”

Lobbyists Win

Yet the president and Republicans’ chief budget expert are no match for the farm and insurance lobbies, which spent at least $52 million influencing lawmakers in the 2012 election cycle. Rather than thin the most expensive strand in the nation’s farm safety net, Congress is poised to funnel billions of dollars more to individuals who already are more prosperous than the typical American.

“We have been subsidizing some of the farmers who least need it in a way that is really costing taxpayers a lot of money,” said Senator Jeanne Shaheen, a Democrat of New Hampshire. “We’re never going to solve our budget challenges if that’s what we’re doing.”

Crop insurers and the USDA say that the subsidized insurance helps stabilize food prices for consumers while protecting farmers from weather-related losses. The program insured $117 billion worth of crops last year, including almost all the corn, soybeans, cotton and wheat grown in the U.S.

Capping Subsidies

First « 1 2 3 4 5 6 7 » Next