Looming Disaster: The ACRE Program

A new paper by agricultural economists Vincent Smith and Barry Goodwin on the looming budgetary disaster triggered by the Average Crop Revenue (ACRE) program. ACRE pays farmers a subsidy when the revenue per acre for a particular crop falls below recent statewide historical averages.

Key findings include:

  • The US Average Crop Revenue (ACRE) program is poised to be a federal budget nightmare, with frequent and large subsidy payments going as high as $10 billion a year--mainly to large, wealthy farms.

  • ACRE is not only an expensive taxpayer liability, but also a Pandora’s box invitation for other countries to successfully file WTO complaints against the United States, damaging trade relations and hurting our agricultural exporters. Do we really want to force US taxpayers to fund programs that increase the global competitiveness of other countries’ farmers so that US farmers can continue to enjoy ACRE subsidies?

  • From the standpoint of fairness, deficit reduction, and trade relations, ACRE is a policy disaster that should be terminated quickly. And Congress shouldn’t allow any look-alike programs--which suffer similar problems--to replace it.

Vince Smith has previously explained how 'improvements' to the ACRE program are no improvement at all.


Vincent Smith is an agricultural economist and a visiting scholar at the American Enterprise Institute. Barry Goodwin is n agricultural economist at North Carolina State University. This paper is part of the American Boondoggle: Fixing the 2012 Farm Bill project which found that taxpayers can save $100 billion over the next ten years.

For media inquires, contact jesse.blumenthal@aei.org or 202.862.4870

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