9. Transforming the Farm Safety Net Through Legislative Action

The federal government radically transformed the farm sector in the 1930s through a series of laws that created a robust system of subsidies for commodity crop production, and provided for an ambitious set of new research and loan programs.²⁹⁵ This flurry of legislation saved countless farms from bankruptcy during the Great Depression, but it also led to the rapid expansion of large-scale, capital-intensive farms and feedlots,²⁹⁶ with scant concern for agriculture’s environmental and social impacts.

Agricultural law is long overdue for another transformation for a number of reasons, including the need to incorporate climate stability and resilience as major goals. The new framework must recognize that the agricultural sector is now vastly different than it was when the laws were first shaped. It has evolved from a diversified and labor-intensive enterprise to a capital-intensive, specialized, and heavily mechanized operation, typically conducted on a massive scale.²⁹⁹ The pastoral “family farm”—which has always been

164

more myth than reality—is of little relevance to today’s agricultural industry: more than 80% of agricultural products are produced by only 7% of farms and only 42% of farms earn a gross income of $10,000 or more.³⁰⁰ Indeed, the majority of low-sales “farms” are hobby, retirement, or paper farms that produce few to no agricultural goods. Environmental laws typically exempt (or have been interpreted to exempt) most aspects of agricultural production from pollution limits and other safeguards.

As climate change intensifies, the need for programs designed around a different set of goals will become even more pressing. Instead of serving to expand the capital-intensive production of commodities, the farm safety net should directly compensate farmers for protecting the environment, mitigating climate change, growing healthy food, and strengthening rural communities.³⁰⁴ As demonstrated above, USDA has significant leeway under current law to revise programs and move agriculture toward, and even to, climate neutrality. However, a system providing for robust payments for ecosystem

165

services (PES) could help realize this goal more quickly and efficiently than the current farm safety net, even with the changes recommended above.

Ecosystem services are benefits that humans derive from ecological resources such as farms, including food, carbon sequestration, wildlife habitat, and recreational enjoyment, among others.³⁰⁵ A PES program is one that provides incentives to farmers or other landowners for provisioning such services. A 2014 study examining the societal value of soil carbon determined that farmers should be compensated at a rate of $16 an acre for implementing best management practices.³⁰⁶ It would cost less than $15 billion annually to implement a PES program at this rate for all 914 million acres of farmland in the United States—billions less than we currently spend on crop insurance, commodity, and conservation programs each year.

Carbon farming will require new infrastructure and equipment, both off and on the farm. Paying farmers for implementing climate-friendly practices—while regulating polluting practices—will facilitate this transition, helping to offset decades of experience and sunk costs in conventional agricultural practices. Reducing the waste that runs through the entire agriculture and food system would provide ample land and resources for a PES system.³⁰⁷ Replacing a portion of the current farm safety net with a PES program would reduce or eliminate payments for crops with high climate impacts, especially those grown for animal feed, while increasing payments for crops with lower climate impacts, thus helping to make healthy food more affordable. Adopting a progressive payment system could also help midsized farms, thus increasing the economic well-being of rural communities, and reduce costs. Limiting payments to the first 1,000 acres of a farm, for example, would reduce the number of eligible acres by more than half.

While such a large-scale shift of the farm subsidy system may seem like a radical proposal, progressive groups and legislators have increasingly proposed major changes to agricultural policy in order to mitigate climate change. Representative Chellie Pingree (D-Me.) released a major bill in February 2020, the Agriculture Resilience Act, designed to reduce agricultural emissions to net zero within 20 years. Its introduction highlights how quickly climate mitigation has become a major objective of agriculture

166

policy for progressive groups and legislators.³⁰⁸ The bill was also designed to serve as a model for the House Select Committee on the Climate Crisis’ recommendations, which were released in June 2020. The Agriculture Resilience Act calls for a number of ambitious policy changes, including the quadrupling of funding for agricultural research and extension, significantly greater federal support for agroforestry, the integration of soil health into the federal crop insurance program, and a massive reduction in the use of liquid manure management systems.³⁰⁹

Paying farmers directly for positive ecological services needed by society would also avoid problems associated with the “submerged state”—the collection of indirect subsidies and incentives granted to private parties by the government.³¹⁰ Crop insurance, for example, appears to be a private-sector form of insurance, but instead acts as a generous subsidy to large-scale farmers.³¹¹ Such indirect funding can undermine public support for robust government action, making policy reform more difficult.³¹² A PES approach has the advantages of fostering transparency, while increasing efficiency.

C. Grazing Practices on Government Land

Overgrazing by livestock increases soil erosion, water pollution, and the loss of soil carbon.³¹³ While grazing occurs on hundreds of millions of acres of private land, more than 40% of all grazing lands in the United States— approximately 330 million acres—are on federal public lands,³¹⁴ managed

167

by BLM and USFS. While BLM is an agency within the U.S. Department of Interior, we discuss its land management policies in this chapter along with USFS, an agency within USDA, because our recommendations for both agencies overlap considerably.

A reduction in grazing intensity would help restore lost carbon.³¹⁵ Although Congress has repeatedly pushed the agencies to reduce overgrazing,³¹⁶ both agencies now do little to reduce overgrazing and indeed have policies that affirmatively thwart independent efforts by ranchers to reduce grazing to more sustainable rates. It would make economic and environmental sense to increase federal grazing fees to reflect fair market value.³¹⁷

BLM and USFS lease land to ranchers on the condition that they will uphold conservation values,³¹⁸ including soil health. However, public interest groups allege that BLM and USFS have done little to enforce these lease provisions.³¹⁹ These agencies should not only enforce these provisions, but should also add new ones designed to reduce the climate impacts of grazing systems. Even small improvements in practices could have a significant impact due to the immense size of federal grazing lands. Just as on private lands, intensive rotational or carefully managed grazing can have numerous ecological and climate benefits, so BLM and USFS should, through pricing or other preferences, seek to incentivize such practices.

Congress has directed that leasing consider not only production but “ecological, environmental, air and atmospheric,” and other values.³²⁰ A key term in any lease or grazing permit is the “grazing intensity”—how many animals can graze a certain allotment in a certain period. Grazing intensities should be based upon accurate assessments of forage consumption by livestock and forage availability.³²¹ It appears that the grazing intensity established in many leases is now outdated, in part because beef cattle live weights (and so forage consumption) have increased by about 30% over the past 30 years,³²² and decades of overgrazing and now climate change reduce forage availability in

168

many regions.³²³ This leads to overgrazing and also has important economic consequences for ranchers, who must purchase supplemental feed to sustain cattle that the land itself cannot support.³²⁴ Both BLM and USFS should undertake a process to update the grazing intensity limit in leases to reflect current conditions.

Even if they do not update leases, the agencies should give ranchers the flexibility to graze fewer than the allotted number of animals in order to preserve the range over the longer term and increase their profitability. However, BLM regulations provide for canceling permits of ranchers who fail to make “substantial use” of allotted forage for two consecutive years.³²⁵ The term “substantial use” is undefined and this ambiguity has prompted many ranchers to maximize their use of allotted forage to ensure compliance with BLM requirements.³²⁶ Similarly, USFS generally requires ranchers to graze at least 90% of allotted forage or risk revocation of their leases.³²⁷ BLM and USFS should revise their policies to allow ranchers to graze at intensities they believe are optimal, allowing them to restore the range and increase soil carbon.

Finally, courts have held that, under the existing law governing grazing on land that is “chiefly valuable for grazing and raising forage crops,”³²⁸ permits and leases cannot be used solely for conservation.³²⁹ This has prevented even those who have paid fair market value for leases to retire the allotments from grazing. Congress should clarify that the purchaser of a lease or permit can graze as few animals as desired in order to preserve ecological values such as soil carbon.