While Irish and EU farmers look to the Common Agricultural Policy of CAP to support their incomes, US farmers have the Farm Bill which combines farmer support with providing food to people on low incomes through the Supplemental Nutrition Assistance Program or SNAP as it is commonly known.

While the CAP has been in place for just over 60 years, the Farm Bill has been part of government policy in the US since the Great Depression of the 1930s.

Its original purpose was to provide food to those in need by buying and distributing surplus agricultural production, supporting farm incomes in the process.

There have been 18 incarnations of the Farm Bill since, the latest of which came into effect in 2018 and was due to expire in 2023 but has been extended to include 2024.

A new Bill is expected to cover 2025-2029 and projections are being formulated for expenditure for the next ten years to 2034 of $1.4 trillion. (€1.3 trillion).

In the 1930s, rampant unemployment caused widespread poverty and farmers were unable to sell their produce because the people didn’t have money to spend.

The government devised a scheme that purchased surplus farm produce and distributed it to people who couldn’t afford to buy it.

A system of food stamps was devised, partly for use on any food purchase and a second stamp that could be used only for the purchase of agricultural commodities that were in surplus.

The modern application has a broader welfare dimension but still has a food supply dimension that could be compared with Food Banks in the UK or the work of charitable organisations in Ireland that provide meals on wheels or food hampers to vulnerable people.

With the broadening of the brief in the US, the budget for SNAP has grown dramatically (see Figure 1) and it now accounts for over 80% of the entire Farm Bill.

There are 12 components in the current Farm Bill and three of these combine with the SNAP to account for 99% of the expenditure with individual breakdown in Figure 2.

Figure 3 shows the projected expenditure from 2025 to 2034 using February 2024 as the baseline.

The commodities category provides support for major crops, including wheat, corn, soybeans, peanuts, rice, and sugar plus dairy as well as disaster assistance.

The support takes the form of a deficit payment system where farmers are compensated from the fund if the commercial value of their produce falls below an expected level.

It is not dissimilar to what was in the UK for beef producers prior to EU membership when the Government made up any deficit between market price and the expected price for the product.

The baseline expenditure for this category from for 2019 to 2028 was put at $61.4bn (€56.8bn) in the 2018 Farm Bill. The second title in the Farm Bill is for Conservation which “encourages environmental stewardship of farmlands and improved management through land retirement programs, working lands programs, or both.”

Expenditure on conservation measures is put at $59.8bn (€55.4bn)over the period.

Crop insurance as the name suggests protects farmers against crop or market failure and accounted for $77.9bn (€72.1bn) in the 2018 Farm Bill.

This is one of the categories where a significant increase is predicted in the 2025-2034 period, rising to $124bn (€114.8bn), see figure 3. Basically, the government provides financial assistance for both the insurance companies for provision and to farmers to purchase crop insurance.

While there is a farmer contribution, farmers couldn’t afford the premiums without assistance.

Everything in the Farm Bill is dwarfed by Nutrition expenditure which includes the SNAP programme. The 2018 bill had provided for $867.2bn (€803bn) from 2019 to 2028 but this was $119.5bn in 2022 alone. The forecast for the 2025-2034 period is a $1.1 trillion (€1.0) spend out of the total $1.4 trillion (€1.3) budget.

Additional 'one-off' expenditure

In addition to this expenditure schedule, there have been significant what is described as supplemental spending or one-off payments to deal with a specific set of circumstances.

During the Trump presidency, the US became embroiled in a trade dispute with China and the administration provided an additional $25bn (€23.1bn) of expenditure in 2019 and 2020 for farmers whose markets were impacted.

More recently the Biden administration provided an additional $30bn ((€27.8bn) pandemic assistance for farmers and $60bn (€55.5bn) to the Nutrition program to offset the effects of Covid-19. The Inflation Reduction Act of 2022 provided $17bn (€15.7bn) for programs in the Conservation and Energy categories.