Farm Bill Complexity: Complete fARCe or Cluster PLuC

I've spent the better part of a day studying and trying to understand the latest Farm Bill. Learning the differences between PLC and ARC. There are two sides to my thinking as I dig into this convoluted monstrosity:

1. If I can crack the code and figure out the nuances of these programs, I can gain a huge advantage over competing cash renters. In turn, I could parlay that opportunity into significant profits. I can really benefit from this.
   
2. Why does such a simple and honest goal require such a complicated package? Who could possibly participate in this and sleep soundly in the confidence of their enrollment decision?

The first farm bill was intended to provide certainty for a nation's food supply and a safety net for it's most vulnerable producers. At least that's the idea we'd all like to believe.

Corn harvest in Iowa - October 2014

But a few minutes of reading into the various calculations and available options within this farm bill, I discovered that it's anything but simple to determine who gets a subsidy and how much. Nothing about this farm bill even pretends to increase producer certainty. On the contrary, reading through industry publications and university informational materials, these new programs have created a dizzying amount of uncertainty in the marketplace.

The inherent complexity increases risk, which undermines the legitimacy of the farm program. To illustrate my point, read my favorite FAQ provided and answered by the Farm Service Agency (FSA):

Are there tools available to assist producers in making a program election?

Congress provided $3 million for universities to develop web-based decision tools for ARC-CO, ARC-IC, PLC, and other 2014 Farm Bill programs. In addition, Congress provided $3 million for producer education, which provides farmers with information on how to use the decision tools.

In what world does is it make sense to create a program that requires spending $6 million to build and train farmers to use spreadsheets? The difficulty of navigating the program details was self-evident to legislators. Why didn't that alert the bill's sponsors that the program buffet was missing the meat and potatoes?

Due to complexity alone this farm bill will reallocate program funds away from the advertised need. Early in my career, a mentor explained that finding the right answer without understanding why is no better than having the wrong answer. For most producers, fully understanding which decision is right and why will be too expensive. They'll settle for either a guess or coffee shop group think.

Commodity producers with the resources and/or level of sophistication to confidently optimize their farm bill decisions least need the safety net. While the smallest and/or least sophisticated producers will have to stumble into positive outcomes, if they benefit at all.

To further illustrate the needless complexity, consider that based on a producer's initial program elections, it is possible to receive subsidy program payments for covered commodities that a farmer later chooses NOT to produce. As long as a commodity's price and/or yield benchmarks fall below calculated thresholds, a farmer can collect a program payment even in years she doesn't plant that crop. The FSA's instructional examples specifically draw attention to this as a possible outcome.

The greatest beneficiaries of this law are the people who serve no public interest in benefitting from a program of this nature. They are the people and entities that create the system, unlock the riddle, and administer the program: lobbyists, lawmakers, attorneys, accountants, and government agencies.

They have spent and continue to spend countless hours making and the solving the puzzle. They monetarily benefit while contributing no real or tangible value to the food production system. This doesn't make those occupations evil, but it's also not the advertised reason for the law or the appropriation of taxpayers funds.

I can't argue against the honest intention of providing a safety net to a nation's food producers. Unfortunately, there's no way to know whether this farm bill will achieve that admirable goal.

The people who are supposed to benefit don't know how to enroll. Even after enrollment, farmers that didn't spend the time and money to analyze every rabbit hole will wonder what they left on the table in the options they turned down.

Even with the benefit of hindsight, at the sunset of the bill, how will anyone know whether it worked, much less how well? It's an unassessable quagmire. A perfect scenario for its true benefactors.

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