One in a continuing series of posts concerning the 2012 Farm Bill

In the last two weeks the Farm Bill has passed from the Senate to the House, with the latter preparing to take the bill to the House Agriculture Committee later this week for deliberations that might decide whether the bill is passed before September 30, the deadline after which the 2008 Farm Bill is set to expire. The Senate version and the proposed House version share many things in common; both eliminate ‘direct payments’, undiscriminating blanket subsidies often criticized as undeservingly given to large agriculture corporations. Both bills also leave intact crop insurance for disastrously bad years, with much of this program’s funds redistributed from direct payment programs, though the Senate version provides a deeper safety net.

However, deep differences between the two chambers’ versions leave congressional observers doubtful that a reconciliation can be reached before the Sep. 30 deadline. The House bill, as to be expected, makes deeper cuts into the deficit; the CBO estimates the House’s version to save $35 billion over the next 10 years, $11 billion more than the Senate version. The cuts come almost exclusively from food stamp programs, which are also, oddly enough, covered within the ‘Farm Bill’ yet comprise a lion’s share of its funding. The House would cut $16 billion from food stamp programs (the Senate version would cut $4 billion) and establish tougher criteria for eligibility. For example, under the House bill $2,000 in bank savings would be enough to disqualify a person from the food stamp program, a restriction that most states eliminated more than 40 years ago. Included in the bill is a $170 million increase in food bank funding, but the cuts far outweigh the gains.

The House’s bill also corrects for what it sees as a bias towards Midwestern corn and soybean farmers, to the detriment of Southern cotton, rice, peanut and wheat growers. The House uses some of the money saved from the elimination of direct payments to create a ‘price support system’, which helps guarantee against sharp declines in crop prices for two or more years in a row. This would be extremely appealing to Southern farmers, whose crop prices are more depressed than the Midwestern crops, corn and soybeans, which have been enjoying very high prices as of late. As for where the rest of the money to fund this price support system will come from, the House plans on cutting the Senate’s shallow losses program. Under that program, farmers would be compensated if their crop was 11-21% below average, while the House insures a farmer for a crop 15-25% below average. Below that, and the farmer qualifies for a deep losses program, which both chambers keep fully intact.

The House Agriculture Committee is chaired by Rep. Frank Lucas (R-OK), who along with ranking Committee member Collin Peterson (D-MN) will by trying to get their version of the bill out of a committee in which fully half of its young members have never worked on a Farm Bill before. But Lucas is optimistic about his bill, looking at its $35 billion in cuts and saying “That’s a large amount of real savings.” Peterson is optimistic as well, but says “while I would have found other ways to accomplish the bill’s nutrition savings (ed. food stamp programs), the bottom line is that, working together, we need to keep this farm bill moving forward.” Lucas has no illusions over the uproar his deep cuts to food stamp programs will create, however; “The nutrition crowd will go ballistic.”

The deep and polarizing rifts between the Senate and House’s version of the Farm Bill all but ensure that the bill’s passage will come down to the wire on the Sep. 30 deadline – if it is passed before the deadline at all. It is very possible no deal will be reached before the 2008 Farm Bill expires Oct. 1. Lucas hopes that it doesn’t have to come to that, saying “I would like to have it done before August…I think it’s possible” but that may be wishful thinking at this point. The Senate, still controlled by the Democrats by the slimmest of margins, will surely be hesitant to vote for a bill that makes such deep cuts to ‘nutrition programs’. They will also object to cuts in conservation programs, which the House bill reduces from 23 to 13. The House bill may be on the wrong side of public opinion in this case; a recent poll by Greenberg Quinlan Rosner Research and Public Opinion Strategies shows that:

• Eighty-six percent of farmers say the level of conservation funding should be maintained or increased
• Conservation programs rank as the second-highest priority for inclusion in the farm bill
• By a nearly two-to-one margin, farmers believe that farmers should be required to meet some environmental standards in order to receive federal benefits such as crop insurance

If the bill should pass Committee this week, Lucas hopes to bring it to the House floor before the end of July. Then, the Senate and House bills would have to be reconciled, and the fun would really begin.

House farm bill cuts deeper- http://www.politico.com/news/stories/0712/78156.html

U.S. House farm bill cuts $35 billion, boosts crop supports- http://www.reuters.com/article/2012/07/05/us-usa-agriculture-idUSBRE86418820120705

Oklahoma Rep. Frank Lucas to lead committee work on new farm bill next week- http://newsok.com/lucas-faces-test-with-farm-bill-draft/article/3690606

Poll: Farmers value conservation programs, reject farm bill conservation funding cuts- http://deltafarmpress.com/government/poll-farmers-value-conservation-programs-reject-farm-bill-conservation-funding-cuts

Iowa farmers split on direct payments in farm bill- http://www.radioiowa.com/2012/07/09/iowa-farmers-split-on-direct-payments-in-farm-bill/