But that was not what the EWG wanted, so it used its best know weapon of embarrassing individual famers by telling their neighbors, their creditors, their fellow church members, and every complete stranger around the globe how much they benefited from the crop insurance program. However, at this point the financial information has not yet been linked to names as has been the farm program payment information that was released. But unlike that information, crop insurance premium subsidies are not actual dollars in one’s pocket, and are an ethereal benefit that most farmers will not realize the size of which exists.
Most farmers know what their premium is, which turns out to be 30% to 50% of what the actual cost is, as calculated by the USDA and the Government Accountability Office. By the way EWG says 62% is the average subsidy paid by taxpayers. In its financial analysis EWG says over 10,000 individual farming operations have received premium subsidies from $100,000 to over $1 million. On the other end are 389,494 operations which received $5,000 or less in premium subsidies, and which EWG calls the “bottom 80%.”
To get in that group, Kansas State University risk management specialist Art Barnaby says most farmers would be surprised to know they are the “big farmers” being attacked by EWG. At some of the higher coverage levels for crop insurance, Barnaby says 75% coverage level of revenue protection would put a Kansas wheat farmer over the $5,000 mark at the 192 acre mark, and the same for an Oklahoma wheat farmer at the 176 acre mark. He says those would be part time farmers, semi-retired farmers, or small investors. Looking at the EWG tables, Barnaby says, “The average number of acres to reach $5,000 was only 223 acres. It should be obvious that this size of grain farm cannot fund a combine that will exceed $400,000 in price plus the header. Grain farmers need size and scale to be efficient.”
Working the calculation backward, Barnaby says the proposed $40,000 payment limit would be reached at the 1,700 acre level as an average, depending on crop, state and type of coverage. He said that is the middle-sized grain farmer who takes out buy-up policies, and if they are over the $40,000 limit, then they would be billed for the additional premium. That could not be determined in advance because premiums and premium subsidies change annually because of the floating nature of crop insurance and the pool of farmers who are investing into it will change annually.