The Farm Bill was voted down last week in the House, but that gives Congress another chance to eliminate this egregious $1.2 billion corporate welfare program from the 2018 Farm Bill. The programs in question, under the Foreign Agricultural Service (FAS), are the Market Access Program (MAP), the Foreign Market Development (FMD) Program, the Technical Assistance for Specialty Crops (TASC) Program, and the Emerging Markets Program (EMP). House Republicans are proposing to consolidate all of these programs under one umbrella, the International Market Development Program, with funds totaling $255 million every year for five years.
The Department of Agriculture’s Foreign Agricultural Service (FAS) spends over $2 billion annually to help build new markets and increase competitiveness for U.S. agriculture in the global marketplace. FAS oversees a number of programs, but the program that attracts the most attention is the Market Access Program.
The Market Access Program provides $200 million annually to subsidize the advertising costs of agriculture companies and trade associations doing business outside of the United States. Originally intended to be a resource for helping small businesses enter export markets, the program has warped into a corporate welfare program.
For example, the Wine Institute gets about $6 million annually to promote the export of mostly California wines – which exported a record $1.53 billion worth of wine in 2017. Other recipients include the Distilled Spirits Council of the United States and Sunkist Growers, Inc. The Distilled Spirits Council whose members include Bacardi, Patron, and Hennessy, received over $409,000 this year, even though the industry exported $1.6 billion in 2017. Sunkist generated over “$1 billion in member payments” through their cooperative farm program in 2016, and received $1.7 million this year.
Since its inception in 1978, MAP has spent over $4.5 billion of taxpayers’ funds. Despite billions in funding from taxpayers, the Congressional Research Service (CRS) has questioned the success of the program. “It is not clear that the program is having any substantial impact on American agriculture‘s total share of global exports. In fact, American agricultural exporters are actually losing market share to their foreign competitors.”
The Trump administration sought to have MAP eliminated, listing it in the President’s Budget appendix as “one of several USDA programs that should be eliminated because they serve “no Federal purpose” or are duplicative.” The Mercatus Center at George Mason University echoes the President, calling the MAP program corporate welfare that takes money from taxpayers and gives it to “politically-privileged commercial interests to promote their exports.”
Supporters of the program tout a 2016 study that found MAP “generated a net return of $28.30 for every dollar invested, and have added an annual average of $8.15 billion to the value of American agricultural exports, and $8.7 billion to farm cash receipts.” While the study’s findings may be true, “the proper role of the government is to be a neutral referee, not a dispenser of financial privilege to select firms,” says Tad DeHaven of the Mercatus Center.
Another common talking point for proponents of the program site that MAP funding goes to “small businesses” and “family farms.” Congress changed the program decades ago so companies like Mcdonalds, Tyson, and Seagram could not directly receive MAP funds, but now most of the funds go to trade associations which represent those companies anyway. According to Mercatus, “This year taxpayers will finance a $13.2 million federal handout to the [US Meat Export Federation. But the real beneficiaries are the members of the Meat Export Federation, which are listed here. Names like Sysco International Food Groups – a subsidiary of Sysco Corporation, which had $55 billion in revenues last year.” Hardly a program for the local farmer.
The other, smaller programs Congress intends to continue funding largely overlap with the Market Access Program. The Obama administration noted that the Foreign Market Development Program overlapped with MAP, and the Emerging Markets Program is described as a “market access program that provides funding for technical assistance activities intended to promote exports of U.S. agricultural commodities and products to emerging markets in all geographic regions, consistent with U.S. foreign policy.” Finally, the groups that receive funding through the Technical Assistance for Specialty Crops (TASC) program also make up the largest collection of MAP recipients – overlapping payments to the same organizations.
Corporate welfare is often times tough to point out. When billions of dollars are up for grabs, big corporations will morph into whatever entity they have to in order to collect those dollars. Studies may show the program is working, but companies like Bacardi, Sysco, and California Wines are all billion dollar operations that should not be subsidized by the federal taxpayer. With a $21 trillion national debt and hundreds of trillions in unfunded liabilities on the horizon, Congress should be stopping handouts to the well-connected – they can afford it, future generations can’t.
