LETTER: Does crop insurance still work?

Farm Forum

In farming today, risks are bigger than ever. That’s one reason farmers have added crop insurance to their risk management tools. Over the years, this tool has evolved into a very important tool on the farm. Banks and others rely on it as much as we do. Very few farms today operate without crop insurance.

Crop insurance saved several family farmers this last year from losing the farm from the nationwide drought. Crop insurance did what it’s intended to do — protect farmers and those relying on farmers from suffering catastrophic loss.

The question is has this tool become too good?

Today, we see unintended consequences of crop insurance. Farms getting bigger, land prices and cash rents higher than anyone could have ever predicted in 2008, young farmers being challenged to find ways to compete in a huge capital venture we call farming. Another unintended consequence of crop insurance is the shrinking cattle and sheep ranchers across the country. With no real tool to protect livestock production risks compared to crop insurance, ranchers are either selling out to farmers who break native sod to farm, or ranchers are becoming farmers themselves. Not to mention the loss of wildlife due to more intensive farming on marginal soils, which also leads to poorer water, air and soil quality.

Now, crop insurance is not the only reason these things have happened, but, it is a contributing factor.

Through crop insurance, the government supports every farm growing the same crops, no matter the size, equally with crop insurance premium subsidies. There is no need to comply with any government regulations as long as you aren’t signed up for any government programs, you can just farm!

Safe, reliable, wholesome food to feed everyone in our country and supporting future farmers to continue doing so should be the goal.

But, is it?

Doug Sombke

South Dakota Farmers Union President