Dairy farms keep closing, and Trump subsidies won't come close to stopping that

While a lot of attention has rightfully been paid to the daily corruption scandal that breaks out of DC and the WisGOP Power Grab here in Madison, it doesn’t mean that other bad things aren’t happening as well. And this includes the ongoing farm crisis that has
resulted in record losses in “America’s Dairyland”.

Wisconsin lost 638 dairy farms in 2018, according to the latest data from the state Department of Agriculture, Trade and Consumer Protection. That's a 7.25 percent decline in the number of registered dairy herds — the biggest drop since records started in 2004.

Bob Cropp, professor emeritus of agricultural and applied economics at the University of Wisconsin-Madison, said Wisconsin's dairy farmers have had it tough.

"We've gone through four years of very disturbing low milk prices for dairy farmers and it's finally taken a hold," Cropp said. "It's not only occurring in Wisconsin. We’re getting reports from some other states like Iowa and others that are telling the same thing."

Cropp said 2018 will likely have the lowest average milk price since the market fell in 2015.

In fact, the report from DATCP shows that 1,180 dairy farms have gone under in the state since the end of 2016, and while Cropp says that milk prices could rebound a bit next year, the trend of declining numbers of Wisconsin dairy farms are likely to continue next year.

With the farm crisis not going away, the Trump Administration announced on Monday that they would go ahead with a second round of direct farm subsidies totaling $4.9 billion. It has the same parameters and levels of the first round of subsidies announced in July, which means that ¾ of the payouts are for soybeans, and farm organizations say the rest of the payments aren’t enough to cover the current losses.

The payouts will apply to the second half of 2018 production for producers of corn, soybeans, wheat, sorghum, cotton, shelled almonds, sweet cherries, dairy and pork, according to USDA.

The payment rates for each farm good included in the program were unchanged from the first round of direct aid, announced in August. Industry groups have said the reimbursement rates are too low to make up for the drop in commodity prices stemming in part from Trump’s trade war. Corn growers, for example, will continue to receive only one cent per bushel.

“One cent per bushel is woefully inadequate to even begin to cover the losses being felt by corn farmers,” Lynn Chrisp, president of the National Corn Growers Association, said in a statement. “USDA did not take into account the reality that many of our farmers are facing.”

And this program’s 12 cents per hundredweight subsidy for milk clearly hasn’t been enough to slow down the rash of Wisconsin dairy farm closings. The real problem here is the overproduction and related advantages that mega-farms get over family farms, and not surprisingly the Trump Administration doesn’t deal with (or doesn’t care) about that reality.

Those facts are why US Rep. Ron Kind (D-La Crosse) said he voted against the recently-passed Farm Bill, as Kind complained that it preserved a system that fails too many Wisconsinites.

“This Farm Bill maintains a status quo that will drive more family farmers out of business. It fails to rein in wasteful subsidies and crop insurance programs that lead to overproduction by big Agribusiness, and sends taxpayer dollars to billionaires on Wall Street, and in Chicago and San Francisco. It cuts $800 million from vital conservation programs, and does nothing to address the damage caused by the President’s trade war.

I can’t support a bill that maintains the failed status quo. As long as family farmers are fighting for their lives in Wisconsin, I will continue to fight for them in this Farm Bill.”

The 2018 Farm Bill has a number of fiscally irresponsible provisions, including a crop subsidy program that gives 80% of all farm subsidies to 20% of American farmers. The Farm Bill also expands the eligibility of pass-through entities, allowing distant relatives (including cousins, nieces and nephews) to qualify for taxpayer-funded commodity payments.

Kind is noting the real conflict that is going on in farm policy, and how it has manifested itself in major dairy losses in Wisconsin. In both DC and in Madison, politicians have given breaks to Big Ag and allowed them to cut corners and pollute while saturating the market with products. This has lowered the per-unit prices, which screws over smaller producers who can’t get away with that corner-cutting.

Wisconsin’s farm crisis seems to be something Tony Evers should talk a lot about in his first year as Governor, given that predecessor Scott Walker only cared about which Big Ag checks he could cash while the rest of rural Wisconsin declined. Maybe it’ll wake up a few people in rural Wisconsin to the fact that Republicans only care about tricking them into voting GOP out of cultural resentment, and that the GOP won’t do a thing when it comes to improving small-town livelihoods and communities.