Ag Policy Blog
Chris Clayton DTN Ag Policy Editor

Tuesday 12/04/12

Farm Policy Caught in a Bad Numbers Game

The farm bill continues to be caught up in the fight over the fiscal cliff, but the way the legislation is being used by everyone reflects the failed priorities in Washington.

A congressional staffer who frequently wins the argument elements during each of our conversations pointed out Monday that in this grand picture of trying to reduce the rate of growth of our national debt by $4 trillion over the next decade, Treasury Secretary Timothy Geithner said on the Sunday talk shows that cutting farm programs can "save a lot of money."

"Reforming farm subsidies -- very important to do -- lots of room to do sensible reforms in that context. And they can raise substantial amounts of money."

The president's budget proposal calls for $400 billion in spending cuts to domestic programs over 10 years, a much smaller share than Republicans are offering to cut. The president's budget plan hinges on a $1.6 trillion increase in taxes over 10 years by raising taxes on the top 2% of Americans.

In the grand scheme, savings in farm programs are going to cut the growth of spending anywhere from $23 billion to $35 billion, depending on whether the Senate or House bill is used as the blueprint. The president's budget proposal last February proposed $32 billion, which also included $8 billion out of crop insurance. Neither the House nor Senate made those insurance cuts.

The House Republicans made their proposal on Monday, which relies heavily on measures already passed by the House earlier, including its changes to Medicare, Medicaid and more than $120 billion in cuts to the Supplemental Nutrition Assistance Program, which the House voted earlier this year to convert to a block-grant program to the states. Neither the House nor Senate farm bills took the cuts to SNAP to anywhere near those levels.

http://www.speaker.gov/…

While so much of the focus is on that tax-rate increase for the top 2% of Americans, no details have been released about proposals concerning farmers such as estate taxes. Without changes, the estate tax reverts back to a $1 million exemption and top rate of 55%.

As it is, House Majority Leader Eric Cantor, R-Va., has declared now that there is no way the farm bill can be brought to the floor under regular order. Cantor argues the votes are still not there to pass it, largely because Cantor has not tried. Yet, despite that major piece of legislation waiting in the cue that could be debated, the House is taking off Thursday this week. Apparently there just isn't anything left to do.

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Posted at 7:41AM CST 12/04/12 by Chris Clayton
Comments (2)
If no farm bill or extension of the current bill is passed, and we revert to the farm bill of 1949 , what becomes of the money that pays for SNAP and the School Lunch Program today?
Posted by Brian Hoffman at 3:27PM CST 12/04/12
With friends like Treasury Secretary Geithner and House Majority Leader Cantor,we farmers don't need any enemies.Bi-partisan anti-agriculture at it's best.')
Posted by W Lee Deutsche at 11:20AM CST 12/05/12
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