Forbes Fat Cats Collect Taxpayer-Funded Farm Subsidies
The federal government paid out $11.3 million in taxpayer-funded farm subsidies to 50 billionaires or farm businesses in which they had an interest between 1995 and 2012, and changes to the farm bill being weighed by Congress could well increase their take. The billionaires profiting from farm subsidies were identified by matching EWG’s Farm Subsidy Database with the Forbes 400 list of the richest Americans.
The billionaires who received farm subsidies between 1995 and 2012 have a collective net worth of $316 billion, based on the Forbes magazine estimates. They include:
Paul Allen (Net worth: $15.8 billion)
- Co-founder of Microsoft
Charles Ergen (Net worth: $12.5 billion)
- Co-founder of DISH Network
Philip Anschutz (Net worth: $10.3 billion)
- Owner of Anschutz Entertainment Group and co-founder of Major League Soccer
Leonard Lauder (Net worth: $7.6 billion)
- Son of Estee Lauder and former CEO of the Estee Lauder Companies Inc.
Jim Kennedy (Net worth: $6.7 billion)
- Chairman of Cox Enterprises
S. Truett Cathy (Net worth: $6 billion)
- Founder of Chick-fil-A
Leslie Wexner (Net worth: $5.7 billion)
- CEO of L Brands Inc., which owns Victoria's Secret
Charles Schwab (Net worth: $5.1 billion)
- Founder of brokerage firm Charles Schwab Corporation
Stewart & Lynda Resnick (Net worth: $3.5 billion)
- Owners of POM Wonderful, Fiji Water and Teleflora
David Rockefeller, Sr. (Net worth: $2.8 billion)
- Former chairman and chief executive of Chase Manhattan Bank
Penny Pritzker (Net worth: $2.2 billion)
- U.S. Secretary of Commerce
Many of these same billionaires may have also received crop insurance subsidies, but taxpayers have no way of knowing because current law prohibits the disclosure of the identities of crop insurance policyholders.
According to EWG’s analysis, more than 40 billionaires own properties that grow crops that are among the most likely to be insured through the federal crop insurance program, including corn, soybeans, wheat, cotton and sorghum. From 1995 to 2012, these five crops account for nearly $44 billion in premium subsidies - about 82 percent of total crop insurance subsidies and more than two-thirds of all acres enrolled in the crop insurance program.
A congressional conference committee is currently meeting to come up with a new farm bill, and proposed changes adopted in both the House and Senate versions of the bill will likely allow these billionaires to bank millions more in premium subsidies. Both bills would shift subsidies from programs currently subject to means testing to the more generous crop insurance program. Unlike traditional farm subsidies, crop insurance premium subsidies are not currently subject to means testing, payment limits or conservation requirements.
In 2008, Congress created a means test that was designed to deny some subsidies to individuals with annual off-farm income of more than $500,000. The year before, Bloomberg News published a report highlighting some of the billionaires who had been receiving subsidies. But, lawmakers specifically declined to apply it to crop insurance, which has become the primary government support for farm business income.
The farm bill conference committee is debating whether to include a modest crop insurance means test that would reduce premium subsidies for the largest one percent of farm businesses – a provision that twice passed the Senate and was endorsed last month by a non-binding resolution in the House.
On average, taxpayers cover 62 percent of the cost of crop insurance premiums. In 2011 alone, some 26 policyholders received more than $1 million each in premium support, according to U.S. Department of Agriculture data analyzed by EWG. More than 10,000 policyholders received more than $100,000 each in premium support that year. In 2012, the USDA's Risk Managment Agency reported the crop insurance program cost taxpayers $14.1 billion.
Like other farm subsidies, crop insurance subsidies overwhelmingly flow to the largest and most successful farm businesses. According to data EWG compiled from USDA, the largest one percent of farm businesses received about $227,000 a year in crop insurance premium support in 2011 – while the bottom 80 percent received only about $5,000 apiece.