With the U.S. Senate’s bipartisan passage of its version of the 2012 farm bill last Thursday, all agricultural eyes turn to the House Agriculture Committee and their efforts at getting a new bill out before an August Congressional recess. It now looks like any mark-up of a farm bill in the House won’t come until July 11 when the committee has scheduled a session to do just that, according to close observers of the process. It’s the first time in recent memory that the Senate has written a farm bill before the House, and it’s the reason that causes concern about getting the new bill done before the fall elections. All along the Senate has had more of a bipartisan spirit in getting the bill written. The House has not and that’s where the concern comes. Can they set aside their political differences to get the bill written?
One of the big hurdles to get over may not be policy issue differences between the House and Senate but rather budget cuts. The Senate bill calls for $23 billion in cuts over the next 10 years but House Speaker John Boehner of Ohio and Republican majority leader Eric Cantor of Virginia are promising much deeper cuts to the farm legislation. One question Agriculture Committee chairman Frank Lucas of Oklahoma must answer is in what areas of the new bill does his committee make those cuts. So far Lucas has told the media he wants to protect American farmers with “a balanced proposal that saves taxpayers billions of dollars, recognizes the diversity of American agriculture, respects the risks producers face, and preserves the tools necessary for food production.”
The challenge for Lucas and his committee seems to fall in that area of the diversity of production around the country and how to protect farmers’ risks. The Senate bill does away with direct and counter cyclical payments and the Average Crop Revenue Election (ACRE) program and replaces it with a new commodity program called the Agriculture Risk Coverage (ACR) program. But southern farmers who grow cotton, rice and peanuts don’t feel that program gives them equal protection to farmers in the corn belt so some form of direct payments may still be in play as the House Agriculture Committee puts the final touches on its bill. We won’t know for sure until July 11 when Congressman Lucas has scheduled a mark-up of the House bill. At that time we will also see if House members will follow the lead of the Senate and put some major changes to farm policy in place. Before passing their bill, Senators agreed to language that would cut the taxpayer share of crop insurance premiums by 15% for farmers with adjusted gross incomes of $750,000.
Conservation efforts also took a hit in the Senate bill to the tune of $6.5 billion over the next decade as the cuts were labeled as a way to streamline and consolidate conservation policy. For the most part, though, conservation groups were on board with the cuts but are afraid the House proposal may call for deeper cuts in the future.
The dairy issue still has the capacity to cause real friction among members before a final resolution is reached. The senate bill does contain the Dairy Security Act, developed and championed by the National Milk Producers’ Federation. That calls for a margin insurance program to protect dairy farmers’ milk checks from the wild fluctuations in prices, especially low prices, as farmers faced in 2009. In the House, that provision is being pushed by Congressman Colin Peterson of Minnesota, ranking member on the House Agriculture Committee. The major controversy, so far, over the dairy title is the market stabilization portion of the Dairy Security Act, which is basically a supply management provision. One group, but not the only one opposed to that part of the program, is the Dairy Business Association, which feels the basic policy makes several positive advances for dairy by getting rid of antiquated and outdated policy, but “delivers a poison pill” according to DBA president Jerry Meissner with the supply management provision. Meissner feels by forcing farmers in the program to cut back their milk production, it will hurt Wisconsin’s dairy industry growth by reducing revenues and de-stabilizing Wisconsin’s consistent milk supply which could threaten our dairy infrastructure. As he also said in a DBA position paper, “the debate over federal dairy policy is far from over.”
House agriculture committee leaders are aware they are under pressure to finish a farm bill by early July so it can clear the full House and move to a House-Senate Conference Committee to work out differences in the bills so both the House and Senate can vote on the compromise bill before Congress recesses for the fall elections. If that doesn’t happen and resolution of the new farm bill is done in a lame duck session, observers feel just about anything can happen to farm policy and most think the outcome won’t be good for agriculture.