Every year, the federal government spends hundreds of millions of dollars to market agricultural products abroad — sending taxpayers’ money to subsidize the advertising campaigns of some of the country’s largest brand names, according to a report by the Senate’s chief waste-watcher.
Sen. Tom Coburn said taxpayer money has gone to subsidize projects such as a promotion of pet shampoo and a reality television show in India sponsored by an American cotton promotor. The Oklahoma Republican said it’s time to trim the flow.
He is releasing a report Thursday morning that highlights a number of brands he said don’t need the help when that money could be better spent reducing the government’s deficit.
“The Market Access Program is a case study of federal inefficiency and overlap,” Mr. Coburn said.
Overall, the marketing program spends more than $200 million every year to pay for advertising, research and promotional travel around the globe for company and trade association executives seeking to raise their products’ profiles.
Mr. Coburn’s top example is Blue Diamond Growers, a California cooperative of almond farms that he said reported $3.3 billion in sales over the past five years, yet has received $28.2 million in promotion subsidies since 1999.
But Susan Brauner, director of public affairs at Blue Diamond, said the marketing assistance is critical to helping the cooperative compete with foreign growers and to gain a foothold in their markets.
“We’ve been participating in this program for a long time because it works for our growers,” she said. “We feel that if anything the U.S. government should be encouraging people like co-ops and others to participate and try to expand exports.”
She said the cooperative is made up of small family growers with farms averaging about 55 acres each, and that the co-op matches $2 for every $1 that the government ponies up from the program.
The return on investment is good for both growers and for taxpayers, because California almond growers’ export activities account for 30,000 jobs, she said.
Ms. Brauner said the subsidies are needed because the U.S. is competing in a tough international market where other countries subsidize at even higher rates.
The Market Access Program has been under fire for years, but has survived and even expanded.
In the post-Republican revolution years after the 1994 elections, marketing subsidies were regular targets for cuts on Capitol Hill, with the Senate holding floor votes almost every year to trim the program.
Those votes routinely failed.
Then, in his 2011 budget, President Obama called for a 20 percent cut in the program, arguing that it duplicates other existing programs and that its economic benefits are “unclear.”