FarmPolicy

August 21, 2018

Farm Bill Issues; and, the Ag Economy

Farm Bill

In a telenews conference with reporters yesterday, Senate Ag. Comm. Chairwoman Debbie Stabenow (D., Mich.) commented on how quickly the panel’s Farm Bill will move from the Committee to the Senate floor: “I don’t know if this is a record, but it’s got to be one of the — possible records for getting a bill from committee on to the floor for consideration, so I’m very pleased about that…after coming out of the committee with 15 to five strong bipartisan vote, we did not have objection to moving to the bill, and there are very few things that have occurred this year, or in — in over the last number of years, that did not require a motion to proceed, and several days of waiting, and a cloture vote, and so on, in order to get to the bill.

We did not have to do that, there was not an objection to going to the bill, and I hope that bodes well for — for moving things through next week.”

Later, Chairwoman Stabenow indicated that, “We’re going to start debate, and we’ll be moving on amendments, you know, as quickly as possible. So I absolutely expect to be on amendments next week, and you know, urging people now to put their amendments together, let them know — let us know what they are so we can work with them.”

Speaking yesterday on the Agriculture Today radio program (Red River Farm Network), Senator Amy Klobuchar (D., Minn.) stated that, “[The Farm Bill] went directly to the floor, I don’t think people– usually when you guys ask me questions its, ‘Okay, you got it through the Committee what’s next?’  And I say, ‘Well, we hope in the next six months we will go to the floor.’ This time it was six hours, and we have the bill on the floor.”

Sen. Klobuchar added that, “there’s good amendments and dumb amendments and we’ll hear them all, get through them and get the bill passed before Memorial Day.”

A news release earlier this week from Sen. Bob Casey (D., Penn.) indicated that, “With frost hitting farms throughout the state, [Sen. Casey], today, pushed for passage of a 5 year Farm Bill before the Senate’s Memorial Day recess.  During a conference call, Senator Casey discussed data showing the benefits that farm bill will have for all Pennsylvanians and highlight the Farm Bill’s inclusion of a crop insurance provision which could aid farmers hit by the recent frost.”

Beyond procedure, when asked yesterday about the House Ag. Comm. passed Farm Bill, which contains much larger cuts to nutrition programs than the Senate version, Chairwoman Stabenow stated: “Well, first of all, I absolutely reject the level of cuts and the way this is done in the House. They eliminate something called categorical eligibility, which we’ve now voted down either two or three times on the Senate floor on a bipartisan basis.  It came up in committee this week, it was voted down on a bipartisan basis. So that policy does not have support in the U.S. Senate. I won’t support it in conference, and so we will look for ways that we can continue to provide savings by tackling abuse, or misuse.”

AP writer Mary Clare Jalonick reported yesterday that, “The two chambers are far apart on how much the $80 billion-a-year program [SNAP] should be cut, however, reflecting a deep ideological and at times emotional divide on the role of government in helping the poor… At both committee meetings, debate over the food stamp cuts was heated, with defenders of the program saying the bills would take food out of the mouths of children and the elderly.”

With respect to the House Ag Committee debate on nutrition, Jerry Hagstrom reported this week at National Journal Online that, “But since the 2010 election, the panel’s membership has consisted of very different types of people, who seem to enjoy being hostile to each other…[W]hen it came time to talk about nutrition, Republicans and Democrats couldn’t wait to show how differently they view the world.”

Rep. Joe Crowley (D., N.Y.) spoke on the House floor recently about cuts to the SNAP program (video replay here), and on the floor Wednesday, Rep. Barbara Lee (D., Calif.) noted that, “Every $1 in SNAP benefits generates $1.70 in economic activity. Yet the Republican farm bill cuts nearly $21 billion from our Nation’s antihunger program while millions of Americans continue to struggle from the impacts of the Great Recession.”

Speaking yesterday with Mike Adams on the AgriTalk radio program, Rep. Steve Fincher (R., Tenn.) indicated that, “And let me be clear about this.  The cuts [in nutrition programs] that we’re making are not cutting people.  They’re reforming programs, existing programs that have been abused.  There’s fraud.  So what we’re doing is tightening these up.  The duplicate programs, we’re reforming those and putting them together, and still making sure that our most vulnerable in our society are taken care of.

“But at the same time, this is a huge, huge program that’s really slipping away from us, and we’ve got to do our part.  I mean, our job in Congress is to make sure that the taxpayer money that’s being sent to Washington is being spent in a responsible way, and in a lot of these areas they’re not.  We think probably, in the end, we will be tickled if we can end up with that $20 billion number.  This is going to be a dog fight on the House floor.  So hopefully we end up with that number.”

On potential procedural movement of the Farm Bill in the House, Mr. Hagstrom indicated in his National Journal article that, “[Chairman] Lucas has said the House leadership has told him the bill will come up on the floor in June. That would follow Senate consideration of the legislation, which is expected to begin Monday. Senate and House leaders want to finish a conference before Sept. 30, when the current extension of the 2008 farm bill is scheduled to expire.”

In addition to nutritional differences in the Committee passed legislation in each chamber, a reporter on yesterday’s conference call noted to Chairwoman Stabenow:  “You were unable to get that egg bill into your mark… Yet the House, as you know, last night, had a contentious debate and included this amendment of Steve King’s to basically block states from being able to impose rules on other states.  What do you think about that particular amendment, and how do you expect to address this issue?

(Note that a FarmPolicy.com transcript of the debate on the King Amendment is available here, while a video replay can be found here).

Chairwoman Stabenow stated that, “Well, our egg producers need some help.  Right now there’s a patchwork of regulations around the country.  I mean, what happened last night in the debate is exactly the reason why we need a national standard.  And the egg producers came together to develop something that’s workable only for them.  I know others in the livestock community think somehow that creates a slippery slope and the possibility of pressure on them to do the same thing.

I really personally disagree.  I think this is something that an industry has done to step up and form an agreement so that the egg producers in Michigan are going to be able to stay in Michigan and sell around the country.  But unfortunately, we did not have the support in committee to put this bill into the farm bill.

And I’m going to continue to look for ways to help the egg producers, because I think they’ve stepped up in a responsible way.”

Dan Charles noted yesterday at the salt blog (NPR) that, “When the agriculture committees of both House and Senate finished their versions of the farm bill this week, all mention of guaranteed living space for egg-laying hens had vanished.

“In fact, the House committee adopted a provision that could make it more difficult for states to set such standards. This amendment, offered by Rep. Steve King, R-Iowa, would prohibit any effort by state governments to control the way that their food is produced by out-of-state farmers. The measure is aimed specifically at California’s Proposition 2, which is set to ban farmers in Iowa or Idaho from selling their eggs in California if those eggs come from chickens housed in traditional cages.”

On the issue of crop insurance, Chairwoman Stabenow noted yesterday: “Well, this is the number one most supported program in the farm bill, from a farmer perspective.  Everywhere we’ve gone, as I’ve traveled around the country, farmers have said we’re willing to give up direct payment subsidies.  We know, from a taxpayer standpoint, that doesn’t make sense that we receive help in good times, but crop insurance is what works for us.”

Meanwhile, differing perspectives on Title I of the Farm Bill continue to percolate.

Speaking with reporters yesterday, Sen. Mike Johanns (R., Neb.) noted that, “This year’s farm bill presents some different problems though. This draft, in my judgment — judgment, represents a step backward for Ag policy. Instead of moving forward with a free market type system, what this farm bill does, is it doubles down on something called, target prices, which is really a subsidy for certain commodities.

That was eliminated in last year’s farm bill. With bipartisan support, it actually got 64 votes in the Senate, got out of committee, but now it’s back in this bill. The government should not be involved in setting prices for commodities. The government should not be involved in raising target prices, which is exactly what’s happening.”

And earlier this week on the AgriTalk radio program with Mike Adams, Sen. Pat Roberts (R., Kans.) expressed similar concerns with respect to the target price concepts and noted that he did not think the current committee bill was “a reform oriented Farm Bill like we passed last year”- Sen. Roberts audio here (MP3- 4:00).

Mikkel Pates reported yesterday at AgWeek Online that, “Will farmers who opted out of the farm program so they could drain wetlands to grow valuable crops now be forced to restore those wetlands if they want to keep vital premium subsidies on their crop insurance?

“Sen. John Hoeven, R-N.D., hopes not. North Dakota’s senior senator tried in vain to pass a half-dozen amendments to the Senate Agriculture Nutrition and Forestry Committee version of the 2013 farm bill that would have kept crop insurance disconnected from conservation compliance, or at least reduce the regulatory burden of compliance.

“That didn’t work in the Senate Ag Committee bill, passed May 14, but Hoeven says he’s still working to keep the insurance and conservation ‘decoupled.’ He says an opportunity is in a conference committee with the House Ag Committee farm bill, also passed this week.”

Mr. Pates added that, “The House version, passed hours later on May 15, does not tie crop insurance to compliance with conservation programs. Additionally, the House bill saves $6 billion by consolidating duplicative conservation programs and streamlining the delivery of incentive funds to farmers, ranchers, and landowners.

“‘The voluntary, incentive-based method of encouraging conservation in the House bill is the right approach,’ says U.S. Rep. Kevin Cramer, R-N.D. ‘Farmers in North Dakota do not need Washington instructing them on how to farm and care for their land. Ensuring crop insurance is decoupled from conservation programs is a top priority for our farmers and ranchers.’”

Additional lawmaker perspective on the House Ag. Committee passed Farm Bill included:

Rep. K. Michael Conaway (R., Tex)- “The bill strengthens Title I by putting in place a new safety net, one that will offer ranchers and farmers choices in how to manage risk while reforming outdated policy. This move creates regional equity among agriculture producers, increasing their choices and implementing a broad approach to production agriculture.”

Rep. Kristi Noem (R., S.D.)- “I fought for policies that are most important to South Dakota, such as livestock disaster programs, forestry provisions to help fight the pine beetle, conservation and a permanent office of tribal relations within the Department of Agriculture. I am proud they were included in this bill and will keep fighting on behalf of South Dakota as the Farm Bill moves forward.”

Rep. Bill Owens (D., N.Y.)- “Owens also applauded the inclusion of a number of local initiatives he either sponsored or co-sponsored earlier this year.  H.R. 1297, the Agricultural Credit Expansion Act, and H.R. 1298, legislation to increase export opportunities for local apple growers, were both originally introduced by Rep. Owens and included this week in the Agriculture Committee’s markup of the Farm Bill.  In addition, H.R. 1272, the Maple Tapping Access Program Act, was also included in the bill.  Rep. Owens joined Rep. Peter Welch as a co-sponsor in introducing that legislation earlier this year.”

Rep. Adrian Smith (R., Neb.)- “Passage of a responsible, long-term Farm Bill is among my highest priorities and yesterday’s markup in the Agriculture Committee was a step in the right direction.”

Rep. Rick Crawford (R., Ark.)- “The House Farm Bill reflects the regional diversity in American agricultural production, including the heavily irrigated Mid-South. The Senate farm bill takes a positive step in sharing this goal, which brings us closer than ever to a final product.”

Rep. Randy Neugebauer (R., Tex.)- “I think there’s more room to target our nutrition funding better.”

Rep. Tim Walz (D., Minn.)- “Speaker Boehner and Majority Leader Cantor should bring this bipartisan bill forward for a vote without delay… [I]’m especially concerned about the large cuts to SNAP, which helps hardworking families and seniors who are struggling to put food on the table. Americans don’t want a handout, just a hand-up in times of need. I’m hopeful much of this funding will be restored in conference with the Senate.”

Rep. John Garamendi (D., Calif.)- “While there’s room for improvement, particularly in light of the shortsighted cuts to food assistance, I believe passing a Farm Bill out of the House Agriculture Committee is a good first step.”

Rep. Jim Costa (D., Calif.)- “We still have more work to do to ensure the 2013 Farm Bill works for all Americans, including revisiting cuts to the Supplemental Nutrition Assistance Program (SNAP), but we are moving this process forward…There is too much good in this bill to let it die before it is heard on the House floor. Rural America cannot afford inaction. We owe them a vote.”

Rep. Suzan DelBene (D., Wash.)- “Today’s bill will benefit our local producers of specialty crops, such as fruits and vegetables, with programs to help them expand and enter new international markets. The funding for the Specialty Crop Research Initiative and Specialty Crop Block Grant Program increased significantly and will help our farmers who rely on partnerships with our local universities to improve crop quality and yields.”

Rep. Kurt Schrader (D., Ore.)- “Overall, I was very pleased with our ability to secure increased funding for our specialty crop programs.  The funding will allow the specialty crop industry to continue to exceed innovative expectations, generate greater economic output and make sure that our food continues to be the safest in the world. This industry is a big piece of the puzzle in making sure that Oregon and American agriculture remain as competitive as possible in the global marketplace for years to come.”

Rep. Annie Kuster (D., N.H.)- “I am gravely disappointed that this legislation undermines assistance for hungry families, and I fought hard to protect this essential program. At the same time, this Farm Bill contains many important reforms: it eliminates wasteful direct payment subsidies, streamlines more than 100 duplicative programs, and includes both an amendment I sponsored to support rural colleges and an amendment I cosponsored to expand access to local, healthy food.”

Rep. Bob Gibbs (R., Ohio)- “As past President of the Ohio Farm Bureau, I believe that agriculture policy should be based on market-driven principles.  Including language for dairy farmers that effectively equates to supply management is the exact opposite of a free market system.  Ohio dairy farmers need to be able to grow with the market, and artificially setting limits on the milk they can produce will only keep them more dependent on government subsidies.

“Finally, I believe the commodity title, Title One, is drastically unfair to Ohio farmers.  The commodity title now includes target prices that are set so high for certain crops, that some farmers may have guaranteed profits.  I believe farmers should be making decisions on what to plant based on market signals, not on which crop will give them the most government subsidy.  I fully support a Farm Bill that gives farmers and producers ways to mitigate their risk to continue to provide a safe and affordable food supply.”

 

Agricultural Economy

Gregory Meyer reported yesterday at The Financial Times Online that, “Farmland prices in the US corn belt have risen at double-digit clip this year despite weaker grain markets in a move that will intensify debate over whether loose monetary policy and congressional largesse are inflating a bubble.

Agricultural land values increased 15 per cent on last year during the first quarter in a district that includes Illinois, Indiana, Iowa, Michigan and Wisconsin, the Federal Reserve Bank of Chicago said on Thursday. The region’s farmland values have trebled in the past decade.

Whether the market is overheating has become a feverishly discussed question among land shoppers from farmers to pension funds. Past booms have ended in prolonged declines, with US prices plunging by 66 per cent from 1919-1940 and more than 40 per cent from 1981-1987, according to research published by the Kansas City Fed.”

Keith Good

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