Congress can't agree on 5 year farm bill

Photo Credit: National Wildlife Fed­er­a­tion
Crowd in front of the US Capi­tol hold­ing Farm Bill Now signs.

9 month exten­sion of 2008 bill passed in fis­cal cliff deal

By Michael Zim­mer­man
mzimmerman@civitasmedia.com

As the year 2012 neared its end, there was a lot of talk about the “fis­cal cliff” deal. But one aspect of that deal was taken care of with a nine-month ban­dage: the Farm Bill.
The Food, Con­ser­va­tion and Energy Act of 2008 was orig­i­nally set to expire in Sep­tem­ber of 2012. It’s a ver­sion of a law first passed in 1933, and now, a new ver­sion is passed every five years or so. With the expi­ra­tion of the so-called “farm bill,” upcom­ing, the Sen­ate passed an updated ver­sion in June, 2012 by a 64–35 vote. A sim­i­lar ver­sion of the bill, with more cuts to one pro­gram, was passed by the House Agri­cul­ture Com­mit­tee on July 5, but never made it to the floor of the House for a vote.
That led Con­gress to pass a nine-month exten­sion of the 2008 bill, leav­ing some farm­ers won­der­ing if the 113th Con­gress can work together to get a long-term bill passed.
Using the term “farm bill” is a bit mis­lead­ing, as most of the funds in the cur­rent law don’t got to farm­ers. The law also encom­passes con­ser­va­tion, trade, energy, and the biggest por­tion of the whole thing: nutri­tion pro­grams.
The actual spend­ing in the bill passed by the Sen­ate (Agri­cul­ture, Reform, Food and Jobs Act of 2012) totals about $500 bil­lion over the next five years. The Con­gres­sional Bud­get Office esti­mates the finan­cial impact, though, over the next 10 years, and the CBO esti­mated that bill would have cost about $969 bil­lion from 2013 through 2022. Though it sounds like a lot of money, the CBO esti­mated that total to be $23.6 bil­lion less than if the cur­rent law remained in effect dur­ing that period.
Of that $969 bil­lion, the vast major­ity comes from nutri­tion pro­grams, namely Sup­ple­men­tal Nutri­tion Assis­tance Pro­gram (SNAP, or food stamps). Nearly 80 per­cent of the total spend­ing goes toward food stamps and nutri­tion, $768.2 bil­lion.
Accord­ing to an Asso­ci­ated Press report on June 21, 2012, food stamp spend­ing has nearly dou­bled in the past five years. The Food Research and Action Cen­ter, a non­profit orga­ni­za­tion focused on food pol­icy, one out of every seven Amer­i­cans, or 47.5 mil­lion peo­ple total, receive ben­e­fits from the Sup­ple­men­tal Nutri­tion Assis­tance Pro­gram (SNAP), for­merly the Food Stamp pro­gram.
As far as local farm­ers go, there is some con­cern about the lack of a five-year bill, but accord­ing to Lane Oss­wald, Dis­trict 18 trustee of the Ohio Farm Bureau Fed­er­a­tion, it’ll be busi­ness as usual for most farm­ers.
“We’re kind of con­cerned about it,” he said. “The Farm Bill pro­vides cer­tainty in a very high risk busi­ness by know­ing what pro­grams will be avail­able. The frus­tra­tion in the ag com­mu­nity is that Con­gress passed a pro­posal in the Sen­ate and House Ag Com­mit­tee, but couldn’t get it passed.”
One thing the nine-month exten­sion does is retain dairy prices. A com­mon argu­ment around the fis­cal cliff talks was about a so-called “dairy cliff,” because many said the price of a gal­lon of milk would have dou­bled if no deal was reached. If the 2008 bill would have expired, the dairy pol­icy would have gone back to the one included in the Agri­cul­tural Act of 1949, which set the floor for the gov­ern­ment pur­chas­ing milk at $39.53 per hun­dred­weight. The cur­rent price is set around $18.
One of the biggest changes con­cern­ing farm­ers in the pro­posed 2012 bills from both the Sen­ate and House Ag Com­mit­tee was an end to direct pay­ments, which are cur­rently paid to farm­ers whether or not a crop was planted. Both pro­pos­als placed more empha­sis in crop insur­ance. The exten­sion passed through Sept. 30, 2013 will keep the direct pay­ments.
Accord­ing to Oss­wald, some pro­grams were lost in the exten­sion.
“The exten­sion holds some base­line val­ues, which will help,” he said. “There are 20-some pro­grams that were lost. They didn’t get included in the exten­sion. Those are mainly con­cerned with con­ser­va­tion and envi­ron­men­tal issues.”
What the exten­sion doesn’t cover is fund­ing for organic pro­grams. Accord­ing to the Cen­ter for Food Safety, the exten­sion doesn’t fund The Organic Research and Exten­sion Insti­tute (OREI). The OREI is a part of the National Insti­tute of Food and Agri­cul­ture, and was funded around $18–20 mil­lion annu­ally. “OREI helps organic pro­duc­ers and proces­sors grow and mar­ket organic food,” the Cen­ter for Food Safety stated.
In real­ity, the Farm Bill does a lot more than pro­vide sub­si­dies to farm­ers. Accord­ing to Tom Vil­sack, U.S. Sec­re­tary of Agri­cul­ture, one out of every 12 jobs are con­nected to the agri­cul­tural com­mu­nity. “I think farm­ers are express­ing some frus­tra­tion about the fact that they were close to get­ting a five-year pro­gram that would have been com­pre­hen­sive, that would have had a series of reforms, that would have assisted in deal­ing with the fis­cal chal­lenges the coun­try is faced with,” Vil­sack told NPR in a Jan. 13 inter­view. “They’re now faced with uncer­tainty in terms of what the poli­cies are going to be, and they’re faced with uncer­tainty in terms of how much sup­port there will actu­ally be once a five-year bill is ulti­mately passed by Con­gress. A new Con­gress, a dif­fer­ent fis­cal chal­lenge because of the sequester dis­cus­sion, so it’s the uncer­tainty of it all and the frus­tra­tion.”
Both ver­sions of the pro­posed bill in the Sen­ate and House Ag Com­mit­tee would have saved money. The CBO esti­mated the sav­ings in the Sen­ate ver­sion at $23.6 bil­lion over 10 years, and with the House Ag Committee’s increase in SNAP cuts, that ver­sion would have saved an esti­mated $35 bil­lion.
At its most basic, the Farm Bill is a way to use tax­payer money to keep inex­pen­sive food on the shelves. Sta­tis­tics released by the United States Depart­ment of Agri­cul­ture in August of 2012 show that the United States spends a smaller per­cent­age of house­hold expenses on food than any other coun­try.
Accord­ing to the USDA, Amer­i­cans spend 6.7 per­cent of their expen­di­tures on food. For com­par­i­son, in the United King­dom, peo­ple spend about 9.4 per­cent. The Japan­ese spend 14.7 per­cent; our neigh­bors to the south in Mex­ico spend 22.7 per­cent. In Egypt, a mas­sive 43.6 per­cent of annual house­hold expen­di­tures are spent on food.
Those sta­tis­tics don’t take into account that the money used to sub­si­dize the United States’ food comes from food pur­chasers in the first place in the form of tax money, so we’re pay­ing the price for the food, but indi­rectly.
Vil­sack spoke at the Amer­i­can Farm Bureau Federation’s annual meet­ing in Nashville on Jan. 14, and he reit­er­ated his hope for a new five-year farm bill pass­ing Con­gress in 2013.
“We are com­mit­ted that 2013 will not be a repeat of 2012,” he said at the meet­ing. “We need a five-year bill and we need it now.”
He con­tin­ued: “I think we were all dis­ap­pointed. We rec­og­nized that this was a chance for us to reform the sys­tem in a way that was defen­si­ble and under­stand­able to the wide vari­ety of peo­ple liv­ing in this country.”

Michael Zim­mer­man is a staff writer at The Register-Herald in Eaton.

Posted by Ashley Fritz on Feb 3 2013. You can follow any responses to this entry through the RSS Feed. Both comments and pings are currently closed.