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Farm Bill Issues: Senate Focus; and, Perspective from Rep. Collin Peterson

Farm Bill: Senate Process

Erik Wasson reported yesterday at The Hill’s On the Money Blog that, “Facing one of the toughest challenges of her career, Senate Agriculture Committee Chairwoman Debbie Stabenow (D-Mich.) on Wednesday expressed optimism that she will be able to save the 2012 farm bill from defeat on the Senate floor.

“‘I am very confident that we will continue to move forward and get this done,’ she said. ‘Failure to act would be a real blow to the economy.’

“Stabenow, who is running for reelection, said she and committee ranking member Sen. Pat Roberts (R-Kan.) have made significant progress in whittling down the 247 amendments filed to the farm bill so that the most important can be debated.”

(Note that an unofficial FarmPolicy.com transcript of a press briefing Chairwoman Stabenow held with reporters yesterday morning is available here).

Mr. Wasson indicated that, “While Stabenow and Roberts pare down the list of ‘germane’ amendments, [Sen. Maj. Leader. Harry Reid (D., Nev.)] is handling the discussion of items like the Pakistan amendment with Senate Minority Leader Mitch McConnell (R-Ky.).”

The Hill update explained that, “[Chairwoman Stabenow] said that talks continue daily with Southern senators over a possible amendment to increase farm subsidies for rice and peanut growers.

“Sen. Kent Conrad (D-N.D.) has taken a lead role in crafting a compromise on additional supports for rice and peanuts, she said, along with Sen. Saxby Chambliss (R-Ga.).

“‘The role Sen. Conrad is playing is very welcome and constructive,’ she said, adding that she has not seen any final proposal from him since official Congressional Budget Office scores are being run.”

DTN Ag Policy Editor Chris Clayton reported yesterday (link requires subscription) that, “Senate Agriculture Committee Chairwoman Debbie Stabenow remained upbeat Wednesday morning even as farm-bill opponents continued to block broader debate on a package of amendments.

“‘We’re just getting started here. Yesterday was the first day we were trying to move forward on amendments.’”

Mr. Clayton noted that, “In a press call with reporters, Stabenow seemed unflustered by the stalling, saying it is a process of negotiation. She added that unfortunately, there are senators seeking to obstruct bills and bring up issues that are not germane to the actual farm bill.”

“Senate Majority Leader Harry Reid, D-Nev., sought to bring up more amendments on Wednesday but Sen. Tom Coburn, R-Okla., objected, effectively blocking those amendments from being debated. [Sen. Rand Paul (R., Ky.)] had made a similar objection to amendments on Tuesday,” the DTN article said.

Daniel Strauss reported yesterday at The Hill’s Floor Action Blog that, “Senate Majority Leader Harry Reid (D-Nev.) continued to use a procedural maneuver to bring small batches of amendments to a Senate farm bill Wednesday, swatting away a request by Sen. Tom Coburn (R-Okla.) to offer a larger bundle of amendments.”

Mr. Strauss pointed out that, “Reid said that Roberts and Stabenow, the sponsors of the farm bill, ‘are trying to come up with a list’ of amendments to consider. Since the chamber began considering the farm bill, more than 100 amendments have been offered by senators…[R]eid said he didn’t want the chamber to do nothing while a deal on amendments was being crafted…[R]eid added he planned to continue offering up amendments until a deal was reached.”

And, Erik Wasson reported yesterday at The Hill’s On the Money Blog that, “Sen. Rand Paul (R-Ky.) made clear Wednesday that he is prepared to block further amendment votes on the farm bill unless he can secure votes on his amendments… [P]aul denied accusations by Senate Agriculture Chairwoman Debbie Stabenow (D-Mich.) that he and other fiscal conservatives were simply trying to ‘throw sand’ and stop the farm bill altogether.”

The Hill article noted that, “If a bipartisan agreement on amendments list cannot be reached, the Senate farm bill may be pulled from the floor. Alternatively, Senate Majority Leader Harry Reid (D-Nev.) could gamble and try to hold a cloture vote, daring the GOP to vote down the farm bill on procedural grounds.”

In a letter to Senators yesterday, the National Sustainable Agriculture Coalition (NSAC) indicated that, “As the floor debate on the Agriculture Reform, Food, and Jobs Act gets underway, the [NSAC] urges you to expeditiously complete consideration of the farm bill, reject all non-germane amendments, and strengthen the bill’s reform, food, and jobs provisions.”

Meanwhile, Senators Stabenow and Roberts penned a column yesterday at Politico that outlined some of the key reforms contained in the Senate Agriculture Committee’s bipartisan 2012 Farm Bill.

 

Farm Bill: Senate Votes on Sugar and Nutrition Amendments

Bloomberg writers Derek Wallbank and Alan Bjerga reported yesterday that, “The Senate rejected an amendment backed by snack-food and beverage companies that would have phased out federal government aid to U.S. sugar growers, including marketing quotas and import restrictions.

“Today’s vote was 50-46 in favor of tabling the amendment, effectively killing the plan.

“Unlike other crop initiatives that send farmers payments, the sugar program keeps prices high primarily by limiting imports, harming consumers and companies, Senator Jeanne Shaheen, the sponsor of the amendment, said yesterday on the Senate floor. ‘This outdated program puts American companies at a competitive disadvantage, and it should go,’ the New Hampshire Democrat said.”

The article added that, “The Coalition for Sugar Reform supported the amendment. Its members include industry groups representing bakers and makers of candy, snack foods, beverages and other groceries, as well as small-government organizations. The amendment would have ended all price supports for the sweetener by 2015 and ended the quota on imports.

“‘Each and every time this amendment comes up for a vote it is rejected by Congress and we wouldn’t expect any different today,’ Phillip Hayes, spokesman for the American Sugar Alliance that represents cane- and beet-sugar growers, said before the vote.” (A related statement from the American Sugar Alliance is available here).

Erik Wasson reported yesterday at The Hill’s On the Money Blog that, “Sugar growers have long been one of the most powerful lobbies in Washington given that sugar is grown in cane form in the South and in beet form in the upper Midwest. Sens. Amy Klobuchar (D-Minn.) and Max Baucus (D-Mont.) led the opposition to the change.”

Also, Daniel Strauss reported yesterday at The Hill’s Floor Action Blog that, “Sen. Kent Conrad (D-N.D.) defended a federal sugar subsidy program Wednesday as the Senate considers a farm bill amendment repealing the system…Conrad said claims that the program keeps the cost of sugar products high or that it hinders the confectionery industry in the United States were completely wrong.”

Remarks yesterday on the Senate floor in support of the sugar program from Sen. Michael Crapo (R., Idaho) can be viewed here (video- 3:09), while arguments yesterday against the program by Sen. Pat Toomey (R., Pa.) can be seen here (video- 9:04).

With respect to nutrition, David Rogers reported yesterday at Politico that, “The decades-old farm and food stamps coalition held in the Senate on Wednesday, as 13 Republicans joined Democrats in blocking a tea party-led effort to cut nutrition funding almost in half and shift control back to the states.

“The 65-33 roll call came just minutes after a much narrower 50-46 vote in which sugar beet and cane growers beat back a bipartisan effort to phase out the farm bill’s sugar support program, which has long been criticized for shifting costs on to American consumers.”

Mr. Rogers added that, “The food stamp vote was significant because the amendment, offered by Sen. Rand Paul (R-Ky.), mirrors a proposal by House Republicans that would also convert the program to a state block grant and cut funding — albeit not as much as the tea party conservative proposed.”

Yesterday’s Politico article pointed out that, “‘It’s out of control. It’s doubled in the last 10 years,’ Paul said. ‘We do not have an endless supply of money.’

“But Agriculture Committee Chairwoman Debbie Stabenow (D-Mich.) bristled at his suggestions that nothing was being done to address abuses in the program. She also said Paul’s proposed cuts were ‘outrageous.’”  (A related FarmPolicy.com audio clip of remarks by Chairwoman Stabenow on the floor yesterday can be heard here (MP3- 1:40)).

 

Farm Bill: Lawmaker Perspective

House Agriculture Committee Ranking Member Collin Peterson (D., Minn.) was a guest on yesterday’s AgriTalk radio program with Mike Adams were the in-depth discussion focused on the Farm Bill.  (An audio replay of yesterday’s AgriTalk interview with Rep. Peterson is available here (MP3- 12 min.), while an unofficial FarmPolicy.com  transcript of the discussion can be read here).

In part, Rep. Peterson stated that, “But I’m very optimistic about this. I think things are going to hold together. I think they’re going to pare those amendments down to what’s real and get them to a manageable level. I’m very optimistic. I think the Senate’s going to get this done.

“We’re going to get it out of the House committee, and we’ll have a tough fight on the floor, but we all are determined to get this done. We’re working together, Frank Lucas and I. There’s no daylight between us. We’re in lockstep. And everybody wants to get this done, and I think we will.”

With respect to crop insurance, the Minnesota Democrat explained that, “And we’ve made a lot of changes in crop insurance the last, since the ’08 bill, and we have not been given hard data yet on what those changes actually did, and so I don’t think we should be making any changes in crop insurance until we get hard data back on what happened with the SRA, what happened with the re-rating and so forth.

“So there will be attempts, but I think we’ll be able to defeat those attempts to muck up the crop insurance system. They just shifted that fight we always had over direct payments, now they’ve shifted it over to crop insurance. It’s the same folks that…I don’t know what their agenda is, exactly, but they’re bound and determined to try to raise the price of food in this country. It seems like that’s the only thing they’re trying to accomplish.”

And after discussing dairy and nutrition related issues, Ranking Member Peterson discussed prospects of getting a Farm Bill to the House floor: “I talked to one of his [House Speaker John Boehner] top aides the other day. Really what John was saying was that…he didn’t say he didn’t want to bring it up. What he said was he didn’t think the Senate would be able to pass a bill, and so therefore he wasn’t even going to think about it, because he thought there was no chance the Senate would get a bill done.

“In talking to one of his top aides, he confirmed with me that if the Senate gets the bill out on a bipartisan basis, if the House committee passes the bill out with 35 billion in cuts on a bipartisan basis, then that changes the entire conversation. At that point, I don’t think there’s any way that they can hold this off the floor. I mean, they’re not going to have any kind of good excuse to do that, you know, so…I don’t think John has said that he wants to do it after November. I think all he was saying throughout this process was he hasn’t got a lot of confidence the Senate can get anything done, and so he just didn’t think it was going to happen.”

Rep. Peterson stated that, “I think Debbie Stabenow has done an outstanding job over in the Senate, and Pat Roberts as well. They’re working together. They are determined to get this done. The leadership over there, Senator Reid is doing everything he can to make this thing happen. Over on our side, Frank and I are working together, and we think we’ve made a lot of progress with our committee members, and we’ll have a strong bipartisan vote for our bill…[A]nd when you get everybody on all sides of this determined to make something happen, you can make it happen.”

In other perspective, Sen. John Hoeven (R., N.D.) penned an opinion item yesterday at The Hill’s Congress Blog titled, “A cost-effective Farm Bill with a strong, market-based safety net.”

 

Farm Bill: Analysis

University of Illinois Agricultural Economist Gary Schnitkey noted in an update posted yesterday at the farmdoc daily blog (“Differences across Crops in Spending Under the 2012 Senate Agriculture Committee Farm Bill”) that, “The Farm Bill passed by the Senate Agriculture Committee has commodity program payments tied to risk management through such program as Agricultural Risk Coverage (ARC) and cotton STAX. This emphasis differs from the 2008 Farm Bill where most commodity title payments are direct payments. The emphasis shift from direct payments to risk management changes the mix in spending across crops. Wheat, cotton, rice, and peanuts have larger proportional spending reductions than corn and soybeans. Given a risk management focus, it will be difficult to avoid having some crops taking larger spending reductions.”

After detailed analysis, Dr. Schnitkey indicated that, “It will be difficult to have a Farm Bill with a risk management focus to maintain the historical proportion of payments across crops. Since wheat has a 39% decline in planted relative to base acres, cotton a 40% decline, and rice a 31% decline, these three crops would have to have much higher projected payments per acre than corn or soybeans to keep historic shares. This would likely result in wheat, cotton, and rice having more risk protection than the other crops. Having difference in risk protection could then have unintended impacts on planting decisions in the future.

“Elimination of direct payments and a move to a risk management program will cause financial adjustments for producers with large per acre payments. In particular, rice producers with near $100 per acre direct payments will have adjustments. These direct payments likely have become built into farmland rents and prices. Hence, loss of these payments likely will lead to adjustments in land markets, which will not occur instantaneously, but will occur with lagged relationships over time. Dealing with this issue presents policy challenges.”

A “Myths vs. Facts” summary yesterday from the Sen. Ag. Comm. noted in part that: “Myth #3: Crop insurance is a subsidy like direct payments

“Facts: Crop insurance is completely different from direct payments and other subsidy programs.  Direct payments provide farmers tax dollars for crops they don’t grow, and even when farmers don’t take a loss. On the other hand, farmers pay into crop insurance, and crop insurance only pays claims when farmers suffer a loss for crops they actually grow. Ending direct payments and three other subsidy programs and transitioning to a risk management approach based on crop insurance saves taxpayers $15 billion, the bulk of the Farm Bill’s savings.”

The International Dairy Foods Association released an update yesterday titled, “Supply Management Would ‘Undoubtedly’ Reduce U.S. Dairy Exports,” which is available here.

And, Alan Beattie noted in part yesterday at The Financial Times Online that, “With the so-called ‘Doha round’ of trade talks in effect dead, the US at least doesn’t have to worry about writing the farm bill to conform with the likely outcome of WTO negotiations over the next five years. But avoiding future WTO litigation from aggrieved trading partners may be a different matter.

 

Farm Bill: Senate Amendments

The following items provide additional detail on some of the Senate Farm Bill Amendments:

– Article, “Senate faces choices on pink slime, tracking DOD’s fruit and vegetable purchases in farm bill debate.”

– News Release, “Begich, McCain Propose Bill To Disclose Crop Insurance Subsidy Recipients.”

– News Release, “NCFC [National Council of Farmer Cooperatives ] Opposes Farm Bill Amendments That Would Weaken Crop Insurance.”

– Letter from organizations to Senators regarding conservation- letter available here.

– Article, “Dem senator advocates for industrial hemp bill.”

Keith Good