Ag Policy Blog
Jerry Hagstrom DTN Political Correspondent

Tuesday 11/27/12

Questioning the Logic of a Possible Farm Bill Extension

Agricultural lobbyists and congressional staffers have more questions than answers about a possible extension of the 2008 farm bill. The reality, it seems, is that an extension would take at least as much effort to craft as passing a new farm bill.

The farm bill’s structure makes writing an extension complicated, not to mention raising the issue of convincing members of Congress — many of whom have been hoping for cuts to food stamps, farm programs or both — to support it.

When the 2008 farm bill expired on September 30, authority for many innovative programs authorized in that bill ended, while traditional farm programs reverted to antiquated laws passed in the 1930s, ’40s and ’50s that make up what are known as the “permanent law” that is suspended each time a new farm bill is passed.

Among the questions that Congress would face in authorizing an extension are the following, the aides and lobbyists said:

What kind of dairy program will the bill include? The milk income loss contract program known as MILC has already expired, and dairy farmers are united in their quest for a new program even though dairy processors don’t like it. If the dairy price support program is not extended or a new one passed by early January, the milk support price would rise to $38 from $16.80 per hundredweight.

Will there be disaster aid for livestock producers and fruit farmers? The House earlier this year passed disaster aid for livestock producers. The House did nothing for fruit farmers, but Senate Agriculture Committee Chairman Debbie Stabenow, D-Mich., would insist on aid for fruit farmers in her state who experienced frost early this year and are not covered. The Senate farm bill includes a disaster aid program.

What will happen to the direct payments program? The farm bills passed by the Senate and by the House Agriculture Committee eliminated this program, which has been much criticized because the $4.9 billion in payments have been going to crop farmers whether prices are high or low. The Agriculture Department sent out the 2012 direct payments in October. It would be easy not to renew the program, but the direct payments have been a key provision in the farm program since 1996 and farmers would be upset if the direct payments were eliminated and the new proposed crop provisions were not passed.

How would a dairy program and disaster aid be financed? Programs that lost their budget authority on October 1 would need offsets. The direct payments are a logical source of budgetary authority, but would crop farmers — and their representatives in Congress — agree to give them up if the new crop programs are not written into the bill?

What will happen to conservation programs? Since the 2008 bill expired, no signups for conservation programs are allowed. Congress has often cut conservation programs in the past to pay for what are interpreted as more immediate needs. Would that happen again?

Will Congress extend payment limitations? The current limits expired with the farm bill.

How long would the extension last? The Congressional Budget Office is scheduled to conduct a fresh analysis of the baseline for each federal program in March, and Congress will be under pressure to write a new farm bill before that analysis, which might indicate that the baseline is lower. But can a new Congress with new members on the House and Senate agriculture committees write a new farm bill in three months?

Will Congress agree to extend a wide range of important and innovative programs that lost their authority to operate on September 30? Besides the well-known programs to promote sales of U.S. farm products overseas, the expired programs include those to help senior citizens buy produce at farmers’ markets, assistance for organic farmers and specialty crops, and help for beginning farmers.

Posted at 9:28AM CST 11/27/12 by Jerry Hagstrom
Comments (1)
There is no doubt we need a completely re-tooled Farm Bill. All of the "Needed Cuts" being called for, are in fact unnecessary. If anything, the system needs some stream-lining, as well as some of the undue influence currently held by Wall Street, Banking and Big Business needs to be rooted out and curtailed. (I seem to remember "Anti-Trust Laws" as being part of our system of Governance back in school.) We have a thoroughly bloated Defense Budget that's larger than that of ALL of our "Enemies" put together, yet tech-wise, they're catching up with us. We build more prison space than we build classrooms. (What!?) We have once again Federally Funded the Epic Fail "War On Drugs" at $30 Million-and climbing. But we're cutting SNAP without a clear "Jobs Plan" and USDA Rural Development, which is one of the few Government Programs actually creating growth in the economy. Once again, we had an Election with "Change" as the "Carrot on the Stick." So...let's see some.
Posted by Ric Ohge at 9:32AM CST 11/28/12
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