House farm bill seeks to restrict food stamp benefits while allowing subsidies for billionaires

How the House farm bill gives billionaires subsidies
How the House farm bill gives billionaires subsidies

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How the House farm bill gives billionaires subsidies 01:57

(CNN)Provisions inside the delayed House farm bill would roll back restrictions on the wealthy obtaining federal farm subsidies, as well as allow extended family members to receive lucrative payments.

The language has generated opposition both from fiscal conservatives who say the payments amount to welfare for wealthy people and critics who note that the same bill proposes new work requirements for participants in the federal food stamp program, SNAP.
Up to 2 million SNAP recipients could lose or have their benefits slashed under the proposed rule changes, according to the left-leaning Center on Budget and Policy Priorities.
Last month, the House voted down the farm bill in an embarrassing defeat for Speaker Paul Ryan. The bill was a casualty of an ongoing inter-party fight among Republicans raging over immigration. However, congressional leaders have vowed to bring the bill back to the floor in the coming weeks.
    The delay means more time for opponents to fight the bill.
    The controversial SNAP changes are being lauded by some Republicans as a way to end the "dependency" of lower-income SNAP recipients.
    "We believe that breaking this poverty cycle is really important," said House Agriculture Chairman Mike Conaway, R-Texas.
    And some members of Congress who receive farm subsidies or did so in the past have been vocal in their support for the SNAP rollbacks.
    Rep. Vicky Hartzler, R-Missouri, who has received at least $986,789 dollars in federal farm subsidies, lauded the SNAP work requirements, saying the change "helps recipients break the cycle of poverty by Improving work opportunities for able-bodied adults receiving federal nutrition assistance."
    Scott Faber, the Environmental Working Group's senior vice president for government affairs, said that stance is hypocritical.
"Certain legislators like Rep. Hartzler are being paid twice by the taxpayers, once to do their job and once for farm subsidies," Faber said. "For those same members to laud efforts to kick the poorest Americans off SNAP is the height of hypocrisy."

    How the farm subsidies work

    Since 2002, Congress has added in multiple means-testing for federal farm subsidies to prevent them from going to the hands of wealthy farm-owners. But tucked away in Sec. 1603 of new bill, is an exemption for "pass-through" businesses from the means testing requirements.
    In practice, this would mean that with a simple accounting trick, billionaire farm owners would once again be eligible for lucrative farm subsidies.
    "It'a basically cronyism," said Daren Bakst, a Senior Research Fellow in agriculture policy at the conservative Heritage Foundation.
    "Someone in Beverly Hills might be getting a check because somehow they're 'farming' in Iowa," Bakst added. "There are too many people who think they can get away with providing billions of dollars to a small section of the agriculture industry, and they think they can do it because they think people aren't paying attention."
    A study by the EWG showed that prior to the 2008 rule change, 50 members of the Forbes 400 list received subsidies, including Richard DeVos, the billionaire father of Education Secretary Betsy DeVos (net worth: $5.6 billion), Microsoft co-founder Paul Allen (net worth: $17.8 billion), and Charles Schwab (Net worth: $6.4 billion).

    Extended families benefit

    Another winner in the proposed farm bill? Farmers' extended families.
    Current law allows for the children, siblings and spouses of farmers to receive subsidies up to $125,000 if they have an ownership stake in the farm and are "actively engaged" in the farming operations. But that provision is vague, and does not require the "actively engaged" family members to live or work on the farm.
    According to the EWG, a simple conference call can prove "active engagement" and almost a quarter of farm subsidy recipients do not physically work on the farm they receive subsidies for.
    Under a provision added by Conaway, a farmer's extended family and their spouses, including "'first cousin, niece, nephew," would become eligible for subsidies. Those subsidies wouldn't be paid directly to the family members, but rather increase the total amount of subsidies a farm would be eligible for.
    In a statement to CNN, Conaway defended the additions, saying, "if a farm is large and complex enough to require multiple individuals' participation to be successful, then Washington should not attempt to place an arbitrary one-size-fits-all approach on them."
    Vincent Smith, Professor of Economics at Montana State University and visiting scholar at the American Enterprise Institute, said the payments aren't necessary.
    "Overwhelmingly, these subsidies flow to farms that are financially on an extremely sound footing, Smith said, "and the payments benefit, by and large, households whose incomes are well above the national average and whose level of wealth on a net worth basis is typically in the multiple millions of dollars. These are not households usually viewed as in need of welfare payments."
    Faber was more succinct: "Ancestry.com should not be in charge of who is eligible for farm subsidies."
    A separate amendment that would have limited subsidies to those who live and work on farms was blocked by Rep. Pete Sessions, R-Texas, who has also pushed for SNAP work requirements.
    "What's unfair is a government program that encourages dependency rather than incentivizing independence via self sufficiency," Sessions said.

    Congressional Subsidies

    An analysis by the EWG found that 32 members of Congress received farm subsidies from 1995-2016. Some of those members have been vocal in their support for the SNAP work requirements.
    Rep. Doug LaMalfa, R-California, whose $1,747,174 in farm subsidies puts him at the top of congressional farm subsidy recipients, voted for the bill in committee and praised its "common sense provisions"
    Rep. Ralph Abraham, R-Louisiana, who has received $444,640 in federal farm subsidies, lauded the SNAP work requirements, saying that they will "help people break out of the cycle of poverty and climb the economic ladder."
    Rep. Kristi Noem, R-South Dakota, who has received $573,568 in federal farm subsidies, said the bill "establishes real work requirements for our nutrition programs," and is a "big step in the right direction."
    Rep. Austin Scott, R-Georgia, who has received $71,454 in federal farm subsidies, took to Twitter to praise the farm bill's "commonsense modernization & reforms to SNAP."
    Because their $174,000 salaries exceed the current limit ($31,980 for a family of four), no member of Congress currently qualifies for SNAP benefits.
    CLARIFICATION: This story has been updated to clarify that some of the lawmakers who support SNAP rollbacks currently receive subsidies and other supporters have received federal farm subsidies in the past.