What are the "rural subsidies" that Ezra Klein and Tom Vilsack are debating?

What exactly are "rural subsidies"? The ill-defined term is at the center of a debate between Washington Post Columnist Ezra Klein and Secretary of Agriculture Tom Vilsack.  

See part onepart two and part three of their exchange. I hope to have more thoughts on the overall exchange later, but I want to start by highlighting this key element.

While Klein refers several times to "rural subsidies" and quizzes Vilsack on what justifies subsidizing rural people, Klein doesn't explain what he means by "rural subsidies." Vilsack doesn't challenge him to unpack it either. That results in a huge gap in the conversation -- a critical gap.

If by "rural subsidies" Klein means farm commodity subsidies, that should be isolated and taken head on. Klein is right to question and challenge the current structure of farm commodity subsidies. They provide unlimited benefit to the largest farm operators. This drives consolidation of farms. Fewer farmers means fewer people in rural America. This approach is not good for rural America, and rural America most certainly has been losing people for decades as a direct result, contrary to Klein's claim.

But farm commodity subsidies should not be characterized as "rural subsides." Their benefit accrues to only a small portion of the rural population. A 2007 report from the Center for Rural Affairs, Over Subsidizing and Under Investing, shows how badly skewed USDA investment is toward very large farm operators and away from investing in programs that build a future for all of rural America.

The report found that the USDA spent nearly twice as much to subsidize just the 20 largest farms in each of 13 leading farm states examined as it invested in rural-development programs to create economic opportunity for the 3 million people living in 1,400 towns in the 20 most-struggling rural counties in the same 13 states.

All other rural development programs (rural broadband, rural small business, value added market development, etc.) account for literally only a fraction of one percent of all farm bill spending.

The Center for Rural Affairs is proposing a modest investment of $100 million per year in rural development in the next farm bill. That would be a several fold increase over current investment in non-farm rural development and would still represent less than one-half of one percent of farm spending allocated by the farm bill and one-sixth of one percent of total funding allocated by the farm bill.

Rural areas receive additional benefit from other health and human service programs, but not because they are rural. I suspect these are not the benefits Klein is arguing against.

If, in fact, Klein means farm program subsidies when he says "rural subsidies", he should use more precisie langauage in the future and should also seek to understand the scope and effect of such subsidies on rural communities, the population of rural America and their future.

In closing for the evening, I'll also just note that there is an entire department dedicated to urban development and countless other ways that federal policy has fostered and subsidized many of the things to be loved about urban America.

Brian Depew, Assitant Director

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