Congress should phase out premium subsidies on crop insurance policies sold to the wealthiest U.S. farmers and offer policies that reward growers who hedge their risks by planting a variety of crops instead of specializing in one or two crops, said the Land Stewardship Project, based in Minnesota. The nonprofit group issued a five-page “Principles of Reform” at the completion of its three-part critique of the federally subsidized insurance program. Under the 2014 farm law, crop insurance is the major strand of the farm safety net, getting more money than traditional crop subsidies.
“Overall, the premium subsidy amount should be reduced from the current average of 62 percent, which is exorbitant, and subsidies at the higher percentages should be tied to higher levels of crop diversification in resource-conserving rotations,” says LSP. It also recommended a phase-down of the premium subsidy as a farmer’s income rose. The subsidy would be halved when adjusted gross income topped $1 million and end when AGI exceeded $2.5 million.
“Federally subsidized crop insurance must be available to all farmers and all crops” said LSP, calling for broader availability of “whole farm” policies that cover diversified farms and better cover for organic farmers.