Wednesday, April 11, 2007
DURING THE DUSTY days of 1930s Oklahoma, destitute farming communities on barren land could hardly afford to invest in power lines or sewage systems. So the federal government intervened, creating a rural development program under the Agriculture Department. It had notable successes, such as rural electrification, that improved the lives of millions. But federal rural development has expanded into 40 programs offering low-cost loans and grants to all sorts of American communities, some of which are neither rural nor deserving.
Last week, The Post's ongoing investigation of federal agriculture programs described a number of distressing cases of misdirected rural development cash. Take the example of charming Provincetown, Mass., a resort town on the tip of Cape Cod famous for beaches as picturesque as the oceanfront real estate is expensive. Because the town is almost deserted for most of the year, it qualifies for special rural community loans and grants. The town got a $1.95 million loan to renovate its pier -- presumably to serve the local fishing industry -- even though the pier is mainly used for tourism. The Provincetown Art Association and Museum got four federal grants and loans in the past three years for, among other purposes, renovating a historic house that was the home of a sea captain.
Consider the story from reporters Gilbert M. Gaul and Sarah Cohen concerning three utility companies serving growing suburban communities near Atlanta: Together, the utilities have gotten $400 million in cut-rate loans since 2001. Even though their customers are hardly rural, the utilities still have access to government financing because of the "once a borrower, always a borrower" policy, under which these companies can continue to receive money long after the areas they serve become suburban. Since 2001, federal rural development loans and grants have topped $70 billion.
Rural development programs should not exist to support pork projects in communities with the resources to build and maintain their own infrastructure. At most, such programs should buoy communities unable to provide basic services, such as rapid ambulance response, for their residents because of their out-of-the-way locations. As Congress prepares to consider farm policy over the coming months, it should aim to pare down not only scandalously wasteful subsidies that go to wealthy farmers but also to eliminate unnecessary rural development financing. After all, the House and Senate will have to remove obvious waste if they wish to pump up more useful conservation programs.