While the U.S. Department of Agriculture directs billions of dollars annually to farmers in the form of subsidies and development grants, a new report says much of that funding could be better spent.
In analyzing data from 2001 to 2003, the Southern Rural Development Initiative, based in Raleigh, N.C., noted that 15 times more USDA money directed to the nation’s poorest rural counties takes the form of subsidies as opposed to development grants.
While subsidies support farmers in crop production, with a majority of those subsides going to a few large farms, the report says, rural development grants can be used for activities that include lessening a community’s dependence on agriculture.
“This policy and funding imbalance clearly inhibits the ability of low-wealth counties to develop into prosperous and secure communities that can effectively compete in the 21st century,” the report says.
At the same time, both subsidies and development grants tend to go to white farmers rather than minority farmers.
The report estimates that in 2002, in counties that are predominantly non-white, only 6 percent of subsidies were directed to minority farm operators.
To improve USDA funding, the report recommends the department direct 10 percent of subsidy payments to rural development and other asset-building activities.
It also asks the department to focus on asset-building strategies for poor rural counties that include efforts like developing networks to support entrepreneurism increase income for low-wealth families.