Farm lobbies, lawmakers aggressively push agendas

Oct 24, 2011
by DTN

Fights began breaking out last Tuesday among agriculture interests over what the super committee might do with the farm bill, even though no one knows how the leaders of the House and Senate agriculture committees are planning to move ahead with the proposal that they sent to the super committee last Monday.

Senate Agriculture Committee Chairwoman Debbie Stabenow, D-MI, Senate Agriculture ranking member Pat Roberts, R-KS, House Agriculture Chairman Frank Lucas, R-OK, and House Agriculture ranking member Collin Peterson, D-MN, sent the super committee a letter Monday saying they would agree to up to $23 billion in farm program cuts over 10 years, and that they will send the super committee a more detailed proposal by Nov. 1 on what they are seeking.

The four principals did not say that they want to write a new five-year farm bill within the super committee process, but lobbyists say they are planning to do just that.

The process through which the four principals may lead the farm bill discussion remained a mystery. One Capitol Hill aide said he believes the farm committee leaders are waiting “to see if the super committee gains traction” before announcing any plans, but that it is unlikely they would hold hearings or markups before finalizing a proposal.

Environmental Working Group President Ken Cook said he is afraid that writing the farm bill through the super committee process, which does not allow amendments on the floor of the House or Senate, will mean the bill gets written without input from “healthy food reformers.”

“Fear of floor action is fear of democracy, and democracy hasn’t been kind to the industrial agriculture establishment this year,” Cook said in a news release. Noting some of the floor votes against subsidies, Cook added, “The agri-lobby has had to endure close or losing votes on many issues including crop subsidy limits and corn ethanol policy.”

Sen. Charles Grassley, R- IA, told rural reporters in a telephone call last Tuesday that Stabenow, Roberts, Lucas and Peterson plan to achieve the $23 billion in savings by cutting $15 billion from direct payments and $4 billion each from conservation and nutrition programs, Reuters reported.

Roberts and Lucas have said they believe savings can be achieved by cutting waste and fraud in the food stamp program and by creating efficiencies in administration.

But Jim Weill of the Food Research and Action Center, an anti-hunger group, told The Hagstrom Report that “there is not money to be squeezed out on the administrative side,” and that reducing money provided to the states for staff to administer the program would mean it would be harder for hungry people to qualify quickly for food stamps.

Noting that the food stamp budget was cut to pay for teacher salaries and the child nutrition bill, Weill said the super committee should follow the Simpson- Bowles Commission and the Gang of Six proposal, both of which protected food stamps and the child nutrition program from cuts.

Grassley and Tim Johnson, D-SD, also announced that they had written the super committee the week before, telling the committee it should include the farm payment limits they previously proposed.

Their legislation would have placed a hard cap on farm payments of $250,000 per married couple ($125,000 per individual) and would save $1.5 billion, they said.

The American Farm Bureau Federation (Farm Bureau) also has sent a letter to members of the House and Senate agriculture committees questioning the development of any farm bill proposal that covers “shallow losses.” Several proposals effectively involve gap coverage that would protect farmers’ income up to 90 percent levels. Effectively, a farmer buys crop insurance at 75 percent protection levels, and the shallow plan would cover anywhere from 10-15 percent, depending on the proposal.

Farm Bureau said “a shallow loss program is a drastic departure from any previous farm policy design” and that “our biggest concern is that by reducing the risk of shallow losses, farmers may be encouraged to take on more risk than they would in response to market signals alone.”

Farm Bureau said creating a shallow loss program would increase moral hazard because “insured individuals may engage in riskier behavior with only a $250 deductible, they may drive faster or in more extreme weather conditions than if they purchased a high deductible policy.”

Farm Bureau’s choice of a comparison led one commodity lobbyist to ask, “What are they drinking or smoking over there?” The letter puts Farm Bureau at odds with cotton, corn and soybean groups that have all proposed new crop programs.

Yet, another battle also is building with dairy programs. The final proposal to the super committee is expected to contain a rewrite of the dairy program proposed by the National Milk Producers Federation and introduced by Peterson and others.

But Sen. Kirsten Gillibrand, D-NY, announced she had introduced two new alternatives to the Peterson bill because “dairy farmers should not have to pay extra for what they are getting now for free.”

The first bill uses the Peterson/National Milk framework, but guarantees a $6 margin for farmers, equivalent to the protection they currently receive under the Milk Income Loss Contract (MILC) Program.

A Gillibrand spokeswoman also said, “We found a problem in the Peterson bill—it repeals MILC before new margin insurance program would be in place. This would leave producers out in the cold while USDA develops the new program.

We corrected this problem in our legislation by requiring USDA to develop and implement new program within 270 days but even if they take longer, producers will have MILC until the new program is in effect.”

The second bill would extend the current MILC program but with a bolstered trigger price pegged to inflation through 2015.

A Gillibrand spokeswoman said the senator hopes the dairy title will not be included in the super committee bill.

“We think that the dairy title needs a lot more debate,” the spokeswoman said. “We should not make a wholesale change of the dairy safety net without any hearings or analysis of the impact on small and medium sized farms.”

In other areas, the National Sustainable Agriculture Coalition announced an appeal to its supporters to raise money to bring small farmers to Washington to lobby for a continuation of programs supporting local and regional food production.

The American Farmland Trust also announced it had hired Ohio State University economist Carl Zulauf to analyze 10 proposed alternatives to the current Title I farm safety net programs, and that the side-by-side analyses are available on its website, — Jerry Hagstrom, DTN