15 May 2008

Ken Salazar and Denver Post Confused On Farm Bill

Sen. Ken Salazar, a Denver Democrat who supports the bill, disputed the idea that it pays rich farmers. The bill allows payments to farmers with adjusted gross incomes of $750,000 or less.

That number doesn't take into account deductions for the cost of running a farm, Salazar said.

"A farmer with an adjusted gross income of $750,000 might be losing his shirt" after paying for fuel, a new tractor and other expenses, Salazar said.

From The Denver Post.

The trouble is that Ken Salazar is wrong. Adjusted gross income is income after business expenses (and student loan interest and self-employed health insurance deductions), not before. Indeed, even gross income for tax purposes is after business expenses.

The amount of crop subsidies received are based upon gross cash crop sales, but the limitation on farm subsidies to prevent rich corporate farmers from unduly benefitting from them, are based upon adjusted gross income (see Section 1601 of the Farm Bill), which, for a farmer with no other form of income, is simply taxable profits from farming.

The notion that our government needs to be spending $43 billion a year, more or less, subsidizing farmers making $750,000 a year net is absurd. The lion's share of these subsidizes go to farmers who are financially comfortable. The is no reason that the U.S. government should be providing corporate welfare to farmers making more than ten times the median family income. If we must have crop subsidies, which have multiple negative impacts on our economy, as a way to preserve open space and a historic way of life, they should be limited to famers who are actually struggling economically.

If Ken Salazar is going to provide corporate welfare to extremely high income farmers (and the limitations is based on a multi-year average further mitigated by generous income averaging provisions available to farmers who file their returns on Schedule F), he should at least do so knowing what he is doing and defending his stance on the merits rather than on a misunderstanding of the bill.

Also, the fact that Anne C. Mulkern, who wrote the story for the Post, didn't note that Salazar was mistaken is a classic example of the mass media's abdication of their responsibility to provide not only each side's opinions about the story, but also the facts. Reporters covering stories like this one have an obligation to their readers to know what they are talking about, and to take to task spin that is plain wrong on the facts, rather than blindly parroting it.


Anonymous said...

Ken S. and his family have lived in Denver for decades. That is where his children went/go to school, and where his wife's business is located. While he may also retain a residence in the Valley, calling him a "Denver Democract" is far from "clueless."

Andrew Oh-Willeke said...

Fair enough. I removed that statement, although I still think that it isn't very apt.