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Sec. Vilsack Examines Ag Outlook and Farm Bill Prospects

posted on April 20, 2012

Congress has begun the arduous task of writing the next Farm Bill.  The pending legislation is expected to end direct payments to producers and overhaul the so-called agricultural "safety net".

Before the measure gets to President Obama however, lawmakers must narrow the gap between Senate Democrats and House Republicans, who this week approved major cuts in the Supplemental Nutrition Assistance Program -- formerly known as food stamps -- and other social programs that account for the vast majority of farm bill spending.  

Noting the rural and urban impact of federal farm policy, the Obama Administration's "Point Man" on agriculture prefers the measure be known as the "Food, Farm and Jobs Bill."  I sat down with Secretary of Agriculture Tom Vilsack Friday and he offered an optimistic outlook for rural America.

Mark Pearson:  Secretary Vilsack welcome back to Market to Market.  Good to have a chance to visit with you and I know your schedule is very tight.  Several things that we want to touch base with you on and I know you - you get these questions constantly.  Farm economy has been very strong in a nutshell give us your outlook.  What do you want to tell a group of farmers watching this program right now about what their industry is going to look like going forward?

Sec. Tom Vilsack, USDA:  First of and foremost be proud of what you are doing and make sure that your friends and neighbors understand what you do because I think we need to do a better job of appreciating agriculture in this country.  We need to do a better job of marketing the benefits to this country that agriculture brings.  Secondly be very confident in the future.  If you look at expanded export market opportunities with new free trade agreements and the discussions and the multilateral Trans Pacific Partnership that the president is pushing there is going to be - continue to be strong exports.  The local and regional food system provides local markets and new opportunities.  The bio-based economy starting with bio-fuels and renewable energy but now expanding to virtually chemicals, fibers, fabrics, and polymers is unlimited in its opportunity.  Conservation at record levels and the outdoor recreational opportunities.  It creates with access to farmland our Voluntary Access Program are all income opportunities.  So, I am very, very strong on the ag economy and very, very proud of what our farmers and ranchers and producers are doing for the country.  

Mark Pearson:  All right.  You mentioned a couple of bright spots.  Trade agreements which have been quite successful.  I know the Korean one was particularly important to you.  Are we going to see more of that down the road?  You talked about the Asian Initiative.  

Sec. Tom Vilsack, USDA:  I think that is the key, Mark.  I think we are looking now not so much at a bilateral conversation as a multilateral.  Many countries in the Southeast Asian area tremendous opportunities in Indonesia, Vietnam, Malaysia obviously continue to expand, opportunities in China and Korea, South Korea.  And Japan I think is going to reengage hopefully.  We are looking at opportunities in the beef market reopening there at some point in time.  So, I think there is just unlimited opportunity in that part of the world.  At the same time you know there are opportunities in South America to recapture some of the market that we lost because we didn't have a Free Trade Agreement with Columbia, now we do.  The Panamanian Agreement will be implemented very soon.  I just think there are tremendous opportunities and of course we continue to have strong relationships with Canada.  That's our number on trading partner.  They sort of switch places with China from month to month.  We obviously have some issues with Mexico which we need to work out and when we do I think we will see expanded opportunities there as well.

Mark Pearson:  You mentioned the Farm, Food, and Jobs Bill which I think is a great name for the Farm Bill.  I think it is more accurate than anything else we have had in the past.  The large portion does go to food assistance programs which most in agriculture want.  They want to see that.  There is concern about the safety net going forward.  Obviously we have had five good years in agriculture as you very well know, good net farm income, still a lot of concern about particularly crop insurance, federal crop insurance, what might happen there.  What's your outlook?

Sec. Tom Vilsack, USDA:  Well, I think you are going to see a Farm, Foods, and Jobs Bill that makes a continued commitment to that safety net and I think crop insurance is going to be at the center of it.  I think you are going to see some effort to try to compliment and supplement crop insurance with some kind of revenue protection effort.  It won't be like the direct payments.  It won't be a program that will be subject to criticism or as much criticism as the current program has been, and it will be one that people will better understand why we are doing what we are doing.  Let me just simply say something about nutrition assistance because this is often lost in the discussion about those programs.  Every time a dollar is spent in a grocery store 16 cents of that dollar finds its way into a pocket of a farmer.  So if you are proposing to cut as some have proposed in the House a 150 billion dollars out of those nutrition assistance programs, that may sound like a good idea but the reality is 16 percent of that 150 billion, roughly 20 billion dollars, would go into a farmer's pocket.  That will be a loss to farmers.  That by the way is more than crop insurance and direct payments combined.  So, I think you have to understand that when we put this bill together the various components compliment each other and create stability in the market, create new opportunities, and that is what we need to be about if we want to continue this the good times that we have been enjoying recently.  

Mark Pearson:  I know it is driven by Congress --- but what is your outlook for a new Farm Bill?

Sec. Tom Vilsack, USDA:  Mark, we have got to have it and here is why. You know apart from the fact that farmers need some assurance that there will be a program and do they understand what the program will be?  We don't have a disaster program.  It expired September 30, 2011.  So if there is a drought, there is a flood, there is a fire, there's tornado --

Mark Pearson:  Which we had every one of last year.

Sec. Tom Vilsack, USDA:  Every single one.  55 million acres impacted.  We're going to have them this year, you know?  You can bet on it.  No, no disaster program.  So what am I going to say to those farmers in the Midwest if their lands are flooded?  Crop insurance that is it.  There is no livestock forage program.  There is no livestock indemnity program.  There is no --- program.  There is nothing to protect you.  That's why it is important to have this legislation done this year.  Secondly it is not going to get any easier fiscally to do it next year than this year.  This is a much better year to do it in my view.  So it has got to get done and applaud the Senate, both the Democrats and the Republicans on the Senate Ag Committee working together to get a bill through their committee, get it on the floor, get it passed, and then put pressure on the House to get it done.

Mark Pearson:  Mr. Secretary, we are out of time.  Thank you so much for stopping by.  We appreciate you taking time to visit with us on Market to Market.

Sec. Tom Vilsack, USDA:  Always Mark.  

Tags: agriculture news