The Federal Farm Bill, which needs to be renewed every 5 years, was last passed in 2002 and is set to expire September 30th. There are many things wrong with the current agriculture subsidy regime. It only benefits a small number of wealthy farmers who grow only a very small number of crops, drives up food prices and rewards farmers for overproducing. According to the Heritage Foundation subsidies cost Americans an average of $320 a year ($216 in taxes and $104 in higher food prices). Senator Lugar from Indiana has suggested that we reform this broken system.

The solution, proposed by Lugar and other lawmakers, is a system of “farmer savings accounts,” also known as “risk management accounts.” The accounts, set up by farmers with their own money and matching funds from the federal government, would be tax free and could be tapped by farmers in time of financial need or left to grow for retirement, like an Individual Retirement Account.

While it would be better to get rid of government handouts altogether this system of savings accounts would be far better then what we have today. ...[MORE]