Farm Bill Update
House, Senate Spar Over Crop Producer Protections - In a he-said/she-said exchange this week, the chair of the House Agriculture Committee's subcommittee on general farm commodities and risk management took shots at the Senate Agriculture Committee's approved 2012 Farm Bill, while the Senate ag panel chair defended her bill and said she was confident differences with the House can be overcome. Rep. Mike Conaway (R, TX), at his subcommittee's hearing this week on the crop protection and insurance components of omnibus farm programs, said the Senate crop title "creates a complicated new program so lopsided it actually locks in profits for some while denying any safety net at all to others...this leads me to conclude that what the Senate has before it cannot be called a farm bill at all," escalating the North versus South crop war over direct payments and crop insurance first exposed in the Senate's deliberations. While the Conaway subcommittee was hearing witnesses from just about every crop group in the country, as well as the crop insurance industry, Sen. Debbie Stabenow (D, MI), chair of the Senate committee, held a conference call with reporters to defend her bill and announce she and committee ranking member Sen. Pat Roberts (R, KS) are ready to move their bill to the floor. "This is real reform," she said, echoing Roberts' comments from the week before, "...it is a fair bill for every crop. We know there are some differences... (but) I'm confident we can put this together." Lucas, Peterson Say Target Prices Will be Part of House Bill -- Saying Congress should write a Farm Bill "for the bad times," and in a nod to regional and crop differences that have emerged as the biggest stumbling block to getting a Farm Bill completed this year, House Agriculture Committee Chair Frank Lucas (R, OK) committed this week to some form of target price/countercyclical payment scheme to address the needs of southern cotton, rice, and peanut producers, and asked all national crop production groups to bring him data to support their recommended target price. Lucas is not alone, as House ag panel ranking member Rep. Collin Peterson (D, MN) endorsed retaining crop target prices to backstop federal crop insurance. While southern producers, armed with new studies out of universities in Texas and Arkansas, argued the draft bill hammered together last fall by the respective chamber ag committees to meet deficit reduction targets set by Congress actually treats southerners better than the Senate Ag Committee's bill, they pointed out that while they lost direct payments as part of an income safety net, retention of target prices at least factored in production costs as part of income protection. At the same time, southerners said the Agriculture Risk Coverage (ARC) shallow loss program - covering 11-21% of a producer's loss with the rest covered by crop insurance - doesn't work for southern crops, particularly rice, since some crops are irrigated and prices don't fluctuate enough to trigger crop insurance payments. Lucas said ARC will only work well when prices are high, and that long periods of low prices demand a target price system. The ag panel chair, hit with criticism that target prices could skew planting decisions, dismissed the notion and pointed to recent shifts in corn acreage to account for ethanol production. It's the market price that drives planting decisions, not target prices, he said. 44 Senators Urge Reid to Bring Up Farm Bill this Year -- A letter from 44 Senators from both sides of the aisle urging quick Senate floor action on the Senate Agriculture Committee's approved 2012 Farm Bill was delivered this week to Majority Leader Harry Reid (D, NV) and Minority Leader Mitch McConnell (R, KY). The letter cites the ag panel's $23-billion savings - though some say the actual savings is much lower - and the bill's "strengthening and preserving farm risk management programs" - as the major reasons for quick Senate action. While Reid told Sen. Debbie Stabenow (D, MI), chair of the ag committee, he'd make floor time available if she was able to get a committee bill approved "with strong bipartisan support," he's been silent on when floor time might be scheduled. Insiders say Reid is looking at bringing up the bill in early June after Congress' Memorial Day recess, about the same time House Agriculture Committee Chair Frank Lucas (R, OK) says his committee will begin markup of its bill. Roberts Moves to Educate Senators Taking Aim at Crop Insurance Cuts - Senate Agriculture Committee ranking member Sen. Pat Roberts (R, KS) this week moved to educate colleagues who are advocating further budget cuts to federally subsidized crop insurance, a program that's emerged as the backbone of both House and Senate 2012 Farm Bill rewrites. The unlikely alliance of Sen. Tom Coburn (R, OK) and Senate Majority Whip Richard Durbin (D, IL) in calling for the insurance subsidy cuts makes Roberts' job tougher. He said he'd talked with Coburn this week about Coburn's notion of cutting crop insurance premium subsidies and administrative buy-downs to insurance companies "point(ing) out the value of crop insurance" and how it forestalls disaster payments in tough times. Coburn and Durbin base their call for "efficiencies and controlled costs" on a March Government Accountability Office (GAO) report Coburn asked for that says USDA could have saved over $1 billion 2011 by capping insurance premium subsidies at $40,000 per person per year. GAO said without a cap, premium subsidies will cost the federal government $8.9 billion per fiscal year in 2013-2022. Roberts said, "Coburn is following the recommendations of GAO, any member of which I don't think has been west of the Mississippi." |