The annual rite of spring for grain farmers is in full swing. While corn and soybean plantings are well behind last year farmers are still waiting for Congress to pass what is now the 2013 Farm Bill. Planting decisions were made in the void that is an extension of the 2008 bill but hope springs eternal.
The third attempt at creating the nearly half-trillion dollar, 5-year budget has been going on behind the scenes for some time. This week, both Agriculture committees took up the legislation. Many of the compromises in the last versions of the bill remain. The 1-in-7 who receive benefits from the alphabet soup of assistance programs are likely to see plenty of changes. In fact, nearly 80 percent of the money allocated for the omnibus bill is spent on those needing a helping hand.
Meanwhile, farmers are caught in the middle. It’s a political game that has gone from “hide and seek” to “wait and see.“
Sen. Debbie Stabenow: The Senate Committee on Agriculture and nutrition is called to order. We’re here today of to mark up our committee bill for the 2013 Farm Bill.”
Officially dubbed the “Agricultural Reform, Food and Jobs Act of 2013” it is similar to legislation written last year that passed the Senate 327 days before this hearing, but later died without any floor debate.
Sen. Debbie Stabenow, D - MI: “We saw last year undeniable proof that farming is the riskiest business in the country.”
Sen. Thad Cochran, R – MS: “The bill reflects fiscal responsibility but provides a workable and strong safety net for families and producers of food and fiber we hope they never need.”
Sen. Pat Roberts, R – KS: “However as it stands today, I do not believe this is a reform bill. I believe it is a rear-view mirror bill.”
Both bills claim victory in slashing spending, but from where the savings originate will likely cause the biggest debate.
Iowa Senator Charles Grassley, a Republican, says the two pieces of legislation contain essentially the same language as last year’s versions of the measure.
Sen. Charles Grassley, R – IA: “The one thing that is bad in this bill that wasn’t there last time, is more leaning towards southern agriculture. And moving back towards something we haven’t had in 15 years, moving back to target prices for peanuts and rice.”
House members spent a lot of time debating the Supplemental Nutrition Assistance Program, or SNAP –formerly known as food stamp program. Assistance programs like SNAP make up 80 percent of the budget for both versions of the bill.
Under provisions in the House version, a $2 billion annual savings would be created by eliminating automatic renewal of SNAP benefits when recipients are signed up for other assistance programs.
Both chambers remain deeply divided but there are few places where there is some agreement.
Reductions in SNAP benefits would be made by giving higher food stamp benefits to those in states that pay lower amounts for heating bill assistance.
Direct payments to farmers would be phased out for a savings of $5 billion annually. Previously, direct payments drew ire as payouts were made every year regardless of crop prices or yield.
Federally subsidized crop insurance would receive a boost and a new program would be created to cover smaller losses on planted crops before crop insurance kicks-in. The provision would favor Midwestern corn and soybean farmers who use crop insurance more often than most.
Crop insurance critics contend administrative costs have tripled since 2001, with taxpayers subsidizing more than 60% of the premiums and the growing exposure of the government to harvest-price guarantees.
And both of the bills would raise target prices for some crops. Certain subsidies would kick-in if prices drop to specific levels, meaning farmers will only receive a payout if prices are low. Many of these subsidy programs have lain dormant for years because of high commodity prices, but remain part of the safety net for producers. A special provision in both measures favors peanut and rice producers with higher price targets.