When the stakes are high and the venue is Capitol Hill, no holds are barred and no language is too harsh, particularly when it comes to agriculture.
And when the medium is Roll Call, a Capitol Hill publication for members of Congress, op-ed pieces not only provide entertainment, but reflect the fact there is no love lost among certain personalities.
One of those personalities is Bruce Babcock, an Iowa State University agricultural economist, who has built a reputation for looking at farm policy, speaking his mind and drawing a crowd. Being from Iowa State, one would think he would take a conservative, pro-agriculture point of view. Wrong!
On April 24, the eminent Babcock likened farmers to drunk partygoers at an open bar in his op-ed piece that appeared on behalf of the Environmental Working Group, an anti-agricultural activist group that has declared war on crop insurance.
He said, “But using farmers’ current crop insurance decisions to measure how much they value insurance is as valid as measuring the value of drinks by how much alcohol is consumed at an open bar.”
When the impact of the drought was being measured last year, Babcock made a name for himself by proclaiming that taxpayers would have to pay $40 billion to bail out farmers as a result of the crop insurance program’s cost structure. He plugged for legislation by two congressmen who frequently have introduced legislation unfriendly to agriculture. Their bill makes major reductions in the program, and Babcock adds, “Just as conversion of open bars to cash bars reduces excessive consumption of alcohol, this step would dramatically reduce farmers’ overconsumption of insurance.”
Whoa, time out!, called Tom Zacharias. Zacharias is not only the president of National Crop Insurance Services, a trade group for the crop insurance industry, but also a former agricultural economics professor at Iowa State. Zacharias was given equal space in Roll Call for his May 3 op-ed, which expectedly took an alternative view of the U.S. Department of Agriculture’s crop insurance program.
Leaving no doubt that he was referring to Babcock’s piece a week earlier, Zacharias said it is easy “to get attention with sensationalist claims and unsubstantiated data.”
Quoting Babcock’s characterization of crop insurance in 2012 as yields diminished, saying that farmers were “laughing all the way to the bank” and “praying for drought, not praying for rain,” Zacharias said, “Never were these anti-agriculture activists and for-hire university economists criticized for their bombastic tone or baseless predictions that turned out to be incredibly inaccurate.”
While their language not only raised eyebrows among Capitol Hill readers of the publication, it also was designed to get the typical media sound bite. However, Zacharias also used some interesting numbers that paint the financial picture of the 2012 drought from the crop insurance standpoint.
He said before farmers could even begin to file a crop insurance claim, $12.7 billion in losses had to come out of their pocket as their deductible. While some farmers were insured up to 85 percent or 90 percent and paid for that through higher premiums, other farmers with 65 percent coverage had to withstand a 35 percent loss before they could file a claim.
Farmers paid $4.1 billion in premiums to obtain coverage, which will return about $17 billion in indemnity payments. Crop insurance companies will shoulder
$1.5 billion from their reserves. The balance will come from the USDA, which has taken in some
$4 billion over the past 10 years above indemnities that have been paid out.
While Babcock and the Environmental Working Group, which hired him to draw the lightning bolts, will draw praise from crop insurance opponents on Capitol Hill, would those opponents support a $17 billion ad hoc disaster aid package that did not have any farmer or industry contributions?
Stu Ellis is an observer of the Central Illinois agriculture scene. Keep up with him on his blog at www.herald-review.com.