Friday, June 15, 2012

It will be a circus without the safety net: Crop Insurance under attack

Family Farmer: The Next Generation
The Farmer I Kissed is one of my clients.  You see, I am not only a farmer kisser, I am a crop insurance agent.  I have been in this business for 20 years.  In all those years, 2011 was the most hectic time I have ever experienced.  100% of my clients had losses, and most of those were total losses.  The majority of my clients are dryland cotton farmers, just like Daniel and I.  The seed that they planted in June finally sprouted in September. Until then, they were lying in dry, dry dirt, in the same condition as when they came out of the bag.  With that said, let's visit the Fortune Teller at the circus and imagine yourself in this situation:  Through no fault of your own, you will receive no income for 12 months.  None. 

That's what it was like to be a farmer in Texas last year.  The tight rope broke, and there was no cotton to harvest, no cotton to take to the gin, no cotton to sell to the merchant.  Enter, the safety net:  Crop Insurance.  Crop insurance is not like you homeowners insurance, where you have a small deductible, say $2500, and if your house burns down, insurance pays for the rest to build you a new house.  The deductibles on a crop insurance policy can be up to 50% of your crop.  That means, in 2011, you would collect 50% of an average crop through an insurance indemnity.  So the tight rope broke, you landed in the safety net, instead of zero you have 50% of your income and at least you are not selling the farm. But you have half your income to meet 100% of your obligations AND somewhere in there you have to prepare for next year's crop.  Land leases don't stop just because there was no crop produced.  Equipment payments don't stop.  The land still has to be cared for, to keep it from eroding, blowing or growing up in weeds.  Thank goodness for that safety net!  It's the only reason the majority of Texas farmers are getting to plant cotton this year!

Family Farmer: The Next Generation
What would happen, if that safety net were taken away?  The land will still be there, food and fiber must still be produced (or we will be hungry and naked pretty fast!) Who could start producing our food and fiber on that land without a safety net?  It wouldn't other family farmers, like the one I kiss.  They would be out of business too.  It would be huge management firms, overseas investors, financial institutions.  We don't want to be in the stands watching that three ring circus.  We MUST keep our family farmers on the land.  Everyone needs to understand, there are many different kinds and sizes of family farmers.  But the key is that they ARE "family farmers" and care deeply about the land and about what they produce for the kitchen tables across this country.

Family Farmer: The Next Generation
Crop insurance is a public-private cooperation.  Private companies deliver a product overseen and regulated by the USDA's Risk Management Agency.  It is a highly successful program that has been duplicated in other countries around the world.  Keeping our food and fiber supply stable and affordable is a matter of national security, so the government aspect is essential.  But right now, an assault is being carried out against the safety net by some of those in Congress that don't realize what would happen if family farmers gave way to the circus.  An assault on the farm safety net is a direct assault on the family farmer.  If amendments being presented are passed, the cuts and limits to crop insurance would cut the wires, leaving the family farmer walking the tight rope without a safety net.  When that happens and we see another 2011 disaster, send in the clowns folks, the circus just hit town.

1 comment:

  1. Good thoughts here Suzie.
    Congress must realize the implications of flying on the trapeze without a safety net.

    What's more is that every honest farmer would much rather bring a crop to harvest than get an insurance check. Even when it might not pay as much. Farmers WANT to farm. Otherwise, they would be walking a much wider tight rope and be doing something easier.