With Rural Jobs Plan, Obama Aims To Shift Aid From Big Agribusiness To Family Farms

Our guest blogger is Sarah Jane Glynn, a policy analyst at the Center for American Progress Action Fund.

President Obama spoke at the White House Rural Economic Forum in Peosta, Iowa on Tuesday, and unveiled a new plan to aid rural America. The plan covers a variety of issues impacting rural Americans, and while it addresses everything from methamphetamine use, to infrastructure, to foreclosures, Obama’s closing speech focused on one of its key components: jobs.

The number of farms has fallen, and more than 90 percent of farming families now rely on off-farm income. Yet net farm income is anticipated to increase 20 percent from 2010, the second highest inflation-adjusted value in 35 years. How is this possible? While small family operations make up more than 90 percent of farms, they control only 27 percent of production. The largest 1.6 percent of farms (most of which are corporately owned) accounted for 50 percent of farm sales in 2002. Part of Obama’s rural jobs initiative would shift the power balance in order to benefit family farms.

Part of Obama’s plan includes encouraging young people to become farmers, as the average American farmer is 57 years old, and an influx of young people is necessary to prevent small farms from disappearing. Obama will create a new program to train and develop the next generation of farmers, offer tax breaks to landowners selling to new family farmers, and tax-credits to off-set the cost of starting small farms. As he said this week:

I saw some of these future farmers of America and their young president right over there, and when you hear the enthusiasm…and energy that these young people display, and the fact that if they can just get a little bit of a break when it comes to getting started on the front end, get a little bit of help with capital, that they are ready to take American agriculture to the next level — it gives you confidence, it gives you hope.

Organic farming is one of the fastest growing sectors of U.S. agriculture, and organic farms tend to be smaller and are more likely to be run by younger people. Obama will increase funds for the National Organic Certification Cost-Share Program, which provides financial assistance to help farmers comply with organic certification standards. The plan also calls for changes to the USDA’s crop insurance rate so that organic farmers are not penalized — organic produce is particularly susceptible to damage from disease and insects.

Finally, Obama has stated he will close loopholes that allow mega-farms to collect federal payments, by limiting eligibility to farmers who are actively working the land, or landlords who are renting to active farmers. In 2009, 62 percent of the $9.5 billion in government payouts to farms went to those grossing more than $250,000 per year, even though they make up only 12 percent of all farms.

While this is a far cry from the overhauls the Center for American Progress has proposed in the past, if we are all going to be focused on Iowa, at least we are talking about how to help family farms rather than who looks the best eating a corndog.