Farmers should follow conservation compliance measures to mitigate risk in crop insurance
US farmers and ranchers can have an attitude of independence that borders on sheer contrariness. When farm organizations and leaders representing US agriculture speak there is often an underlying message that farmers know what we’re doing on the land, how to do it, and as long as we’re doing our job, don’t ask too many questions or put demands on us.
A recent example of this position came from House Agriculture Committee Chair Frank Lucas. In a press release reinforcing his opposition to adding conservation compliance to crop insurance, Lucas stated that conservation “compliance measures tied to crop insurance would be a misguided and redundant regulatory burden imposed on farmers and their property rights… Farmers and ranchers are the best possible stewards of their land. They are already successfully using conservation practices to protect our natural resources.”
Nevertheless, farmers and ranchers rely heavily on investments made by the other 98% of the US population, and on the access to global markets negotiated with other nations. US taxpayers currently invest billions in crop insurance subsidies, commodity loans, conservation cost-shares, and other ag subsidies so that farmers and ranchers can “do their job” and have a safety net. When you add in the investments that our nation makes to keep roads maintained, rivers dredged, and ports maintained to transport crops and livestock, I would say that producers are beholden to a lot of people.
The farm subsidy provision getting the most attention now is crop insurance – a program where US taxpayers now contribute around 60% of the cost of premiums.
I would be among the first to admit that without crop insurance, my operation would be in a world of hurts. In 2011 and 2012 we had little or no wheat or sorghum crop due to a drought that lasted until almost mid-year of 2013.
If current versions of the House and Senate farm bill hold true, insurance will be the centerpiece of the agricultural safety net as direct payments and other commodity title programs fade away. However, to receive commodity subsidies, farmers must comply with basic conservation compliance measures that protect soil and water. That compliance is not currently part of the crop insurance programs. The Senate version passed last May added conservation compliance; the House version eliminated that provision mostly from opposition from Agriculture Committee chair, Frank Lucas.
Lucas’ opposition was bolstered by the American Farm Bureau’s shift on the issue. AFB had not objected to requiring some tying conservation to insurance programs in the Senate bill. However, little over a month later they suddenly made an about face and complained, like Lucas, that compliance would only add bureaucracy and further burden farmers.
Maybe it’s time to look at crop insurance with the same lens as we use for people. Over the past few decades, insurance companies have become involved in health maintenance, and preventing illness for those they insure. The overall costs of insurance come down as the pool of those insured include those that are in good health or are working to lessen their risk to disease. Insurance companies know that promoting health and safety rather than simply paying for the costs of illness and mishap, lowers costs and spreads benefits.
Should it be any different for those managing the resource base that must continue to provide food and fiber not just for the short term profits of a family that may be there for a few generations, but for the long term future? In addition, agriculture operates in a global context. Management of soil and water has a role to play in creating resilience, capturing carbon, and meeting the demands of a world that will increasingly face the challenges of poverty, extreme weather, and constrained resources.
On my family’s operation, and on those farms and ranches that I look to as models of stewardship, we invest heavily each year on building soil health , reducing tillage, and managing the grass and forage that support the livestock both above and below the soil. In this way, the shocks of disasters are buffered and cost of recovery is less. This is also a premium paid to manage risk.
When farmers and rural folks complain that an increasingly urban America doesn’t understand agriculture, they should consider the message they sent by rejecting the modest request for accountability. Conservation compliance measures have been required for participating in other commodity programs for decades. Now crop insurance is poised to become the primary safety net for farmers. The funding for that transfer of risk relies primarily on the non-farming population; those folks have every right to require us to protect that investment and manage for risk in a way that preserves soil, water, and air and helps make the world more resilient and productive.