GAO Report Critical of USDA’s Market Facilitation Program

WASHINGTON, DC – Did USDA miscalculate trade damages to producers under the Market Facilitation Program (MFP) in 2019?

According to a new Government Accountability Office (GAO) report, requested last January (2020) by the Chairwoman of the Senate Agriculture Committee, Sen. Debbie Stabenow (MI-D), the answer is yes.

When the United States levied tariffs on foreign trading partners in 2018, exports of certain agricultural commodities were negatively affected. So in 2018 and 2019, USDA paid producers $23 billion to compensate for lost exports under the MFP and MFP 2.0 programs.

Analysis from the GAO suggests that USDA over-estimated and therefore overpaid corn producers ($3 billion) while underpaying soybean, sorghum, and cotton producers. Payments using minimum and maximum county rates in 2019 helped address potential inequities discovered by an internal USDA review. Still, they led to regional differences that appeared inequitable to GAO.

In the final report, GAO recommends that the Secretary of Agriculture ensure that USDA’s Chief Economist provides transparency in documenting future economic analyses and assesses whether representative baselines are accurate.

Sen. Stabenow says the report “confirms that the Trump USDA picked winners and losers in their trade aid programs and left everyone else behind.”
(SOURCE: All Ag News)