DTN Ag Policy Editor Chris Clayton reported yesterday (link requires subscription) that, “The crop insurance industry could benefit from ‘common sense structural changes,’ according to a pair of senators, who cite a recent government study in calling on the Senate Agriculture Committee to further investigate reducing premium subsidies to farmers.
“In a bi-partisan letter, Sens. Tom Coburn, R-Okla., and Dick Durbin, D-Ill., wrote earlier this week to Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., and ranking member Pat Roberts, R-Kan., asking them examine ways to find taxpayer savings in crop insurance. Coburn and Durbin cited a Government Accountability Office report last month requested by Coburn that highlighted the growing costs of the crop insurance program.”
DTN Political Correspondent Jerry Hagstrom reported yesterday (link requires subscription) that, “During the congressional recess and this week, both aides and lobbyists were reluctant to speak on the record about the proposed farm bill.
“One aide to a senator who is not a member of the Senate Agriculture Committee said committee aides had begun asking staffers from other offices their opinion of the bill and whether their bosses would support it as written.”
Senate Agriculture Committee Member John Boozman (R., Ark.) was a guest yesterday on KASU radio (Jonesboro, Ark.) with host Mark Smith where in part, the two discussed 2012 Farm Bill issues and the bill that passed the Senate Agriculture Committee last week.
During a portion of yesterday’s discussion, Sen. Boozman elaborated on concerns from Southern producers, the potential difference in the House “vision” of the measure, why the Senate Ag Committee voted on a Farm Bill proposal prior to the House Ag Committee, and the SNAP (food stamps) program. The discussion of these issues can be heard in this clip from the KASU program (MP3- 3:50).
Farm Bill: Lawmaker, and Executive Branch Perspectives
Senate Ag Committee Ranking Member Pat Roberts (R., Kan.) was a guest on Friday’s AgriTalk radio program with Mike Adams where part of their conversation turned to last week’s Senate action on the Farm Bill. In part, Sen. Roberts noted that, “I think that we can talk [Senate Leader] Harry Reid [D., Nev.] into putting this on the floor,” and added that, “I really don’t expect that many amendments.”
The Kansas Republican pointed out that, “We saved over $23 billion for the taxpayer. We are the first authorizing committee- agriculture led the way- in providing significant deficit reduction to reduce the debt and spending, over $23 billion.”
To listen to the full remarks on the Farm Bill from Sen. Roberts, just click here (MP3- 3:31).
David Rogers reported yesterday at Politico that, “Landmarkfarm legislation cleared the Senate Agriculture Committee Thursday, promising wholesale changes in commodity programs but also opening up a major breach with Southern growers angered by what they see as an unfair tilt toward the Midwest Corn Belt.
“The 16-5 vote—counting proxies — underscored the regional split, with two former Agriculture chairmen from the South and Senate Minority Leader Mitch McConnell from the border state of Kentucky joining in the opposition.
“The action followed a long night of final adjustments in what proved a vain attempt to buy unity. Cotton won concessions on its own revenue protection program, including a decision to lift the acreage cap on land enrolled. But the leadership resisted any return to a countercyclical program with target prices, and Sen. Saxby Chambliss (R-Ga.) bluntly warned that peanuts and rice will take a ‘huge hit’ and are left ‘without any safety net whatsoever.’” (Note: To listen to detailed remarks from Sen. Chambliss at yesterday’s markup in which he methodically explains some of the unique characteristics of peanut and rice production, and how these differences translate into desired policy options that are separate from Midwestern corn and soybean operations, just click here (MP3- 6:12)).
A press release last night from the Senate Ag Committee indicated that, “Senator Debbie Stabenow, Chairwoman of the U.S. Senate Committee on Agriculture, Nutrition and Forestry, will convene a meeting of the full Committee for purposes of considering and marking up the 2012 Farm Bill on Thursday, April 26 at 10:30 a.m. in the Committee’s hearing room, 328-A of the Russell Senate Office Building.”
Recall that today’s hearing was originally scheduled for Wednesday. With respect to this one-day delay, a daily National Journal Daily Email from yesterday, the Need-To-Know Memo, reported that, “After complaints from Southern farm groups and western corn growers, the Senate Committee on Agriculture Nutrition and Forestry has postponed the markup of the Farm Bill.”
DTN Ag Policy Editor Chris Clayton reported on Friday that, “Farmers will have to choose between a commodity program based on their individual farm or one that factors in countywide yield and income.
“Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., on Friday released a 900-page ‘chairman’s mark’ of the farm bill for the full committee to debate or amend. The committee is set to meet on Wednesday to consider the legislation.
The ten witnesses addressed a variety of issues, but two overriding themes dominated their testimony: The strong desire to keep conservation compliance requirements and payment limitation regulations separate from crop insurance, as well as concerns regarding revenue insurance and price guarantee policy variables that are currently part of discussions associated with Title I of the Farm Bill.
Gary Harshburger from Dodge City, Kansas testified that, “Please keep crop insurance tools purchased by the producer protected from environmental compliance requirements or other payment limit conditions that do not belong tied to insurance.”
Kansas producer Keith Miller indicated that, “Simply put, during the development of the 2012 Farm Bill, crop insurance must be a priority…[A]s you’re well aware, recent cuts to crop insurance and the renegotiation of the SRA [Standard Reinsurance Agreement] have resulted in $12 to $20 billion in savings. Additional cuts will likely result in increased premiums to producers or reductions in the products available or the level of service companies are able to provide. We simply cannot afford additional cuts in today’s high risk marketplace.”
Mr. Miller added that, “In addition, in no case should the crop insurance tools, which are purchased by the producer, be encumbered with environmental regulation, conservation requirements, or other conditions that fall out of the scope of insurance. They should also not be subject to payment limits or means testing, doing so would defeat the purpose of the programs and reduce their effectiveness in ensuring that producers, no matter how small or large have equal access to risk management tools and an equal opportunity to continue to operate their farms.”
Scott Neufeld, a farmer from Oklahoma pointed out that, “I also strongly oppose applying payment limitations and means testing to Crop Insurance. The agricultural economy has driven many producers to become larger to spread risk and investment in equipment. A farmer producing crops on 1,000 acres of cropland has to have adequate capital invested to efficiently farm these acres. A partnership or family corporation that has gone together and is producing crops on 10,000 acres has the same risk per acre as the smaller producer. Why would we penalize the larger producer by restricting the amount of protection they would be allowed? We need to change our mindset to a per acre basis, not a per operator basis.
“As producers already enrolled in the Farm Bill, conservation compliance is already a requirement to participate so I cannot see the need to entangle Crop Insurance with existing requirements and I urge Members of Congress to oppose this effort.”
And Texas farmer Dee Vaughan added that, “I want to add my voice to the chorus and say, whatever you do, please do nothing to harm crop insurance. Proposals to link conservation compliance and to impose a pay limit on crop insurance are thinly veiled attempts to kill insurance for farmers. Period.”
Additionally, producers on Friday expressed some concern about Title I revenue proposals versus price protection policy ideas.
Oklahoma producer Scott Neufeld expressed concern about revenue programs in his opening statement at Friday’s hearing. Mr. Neufeld walked Committee members through some recent history regarding fluctuating wheat prices and noted that, “All the revenue program ideas floating around out there will not provide the kind of protection farmers need if the depressed prices we just talked about remain in place for several years.”
Mr. Neufeld added, “So, I call on Congress to focus the Farm Bill on providing real price protection for farmers in these periods of prolonged low prices. Fortunately, thanks to the Chairman and the work of his Committee, the 2011 package to the Select Committee [or Super Committee] would have met this basic test.”
Related audio from Mr. Neufeld available here, (MP3- 1:28).
Also, Chairman Lucas engaged in a colloquy with Texas farmer Dee Vaughan during the “Q and A” portion of Friday’s hearing. Specifically, Chairman Lucas inquired about a recent letter from several farm groups that was sent earlier this week to the Leaders of the Senate Agriculture Committee.
A news release yesterday regarding this letter from the American Soybean Association stated that, “The groups do not, however, support program alternatives that tie current-year production to fixed price supports, which can distort planting decisions and production between commodities when market prices decline.”
Chairman Lucas asked Mr. Vaughan to comment on the issue of price protection, a portion of this discussion can be heard here (MP3- 3:04). Mr. Vaughan disagreed with the statement in the letter regarding the lack of support for a price-based protective system.
Meanwhile, Rep. Mike Conaway (R., Tex.), the Chairman of the General Farm Commodities and Risk Management Subcommittee, asked Mr. Vaughan about the recent GAO report regarding crop insurance (As DTN Ag Policy Editor Chris Clayton reported last week, “The GAO, Congress’ investigative arm for examining government spending, stated a $40,000 cap on premium subsidies would have saved taxpayers $1 billion last year and as much as $358 million in 2010.”) To listen to this discussion, just click here (MP3- 1:20).
And also at Friday’s hearing, Rep. Tim Huelskamp (R., Kans.) asked Nebraska farmer Zach Hunnicutt, about proposed Department of Labor regulations regarding child labor limitations on the farm- related audio here (MP3- 1:30).
DTN Ag Policy Editor Chris Clayton reported yesterday (link requires subscription) that, “With the Senate Agriculture Committee expected to release Chairwoman Debbie Stabenow’s proposed bill as early as Friday, eight major agricultural groups wrote senators on Thursday asking them to avoid cuts in crop insurance and stay away from hikes in target prices.
“Stabenow, D-Mich., and Ranking Member Pat Roberts, R-Kan., are expected to release a joint bill on Friday with anticipation that the Agriculture Committee will debate and pass a bill next week. Still, no official word has come down from the committee regarding a mark-up for the bill.
“The farm groups credited the Senate Agriculture Committee for sticking with the $23 billion in cuts proposed in the failed supercommittee talks last fall. President Barack Obama and leaders in the House Budget Committee have pushed for higher cuts.”
Budget Issues (Farm Bill): House Ag Committee Business Meeting on Budget Reconciliation Instructions
Reuters writer Emily Stephenson reported yesterday that, “A U.S. congressional panel approved about $33 billion in cuts over 10 years from food stamp benefits, in a largely symbolic and highly partisan vote opposed by committee Democrats and by anti-poverty groups.
“The cuts advanced by the House of Representatives Agriculture Committee on Wednesday would reduce spending on food stamps that help 46 million people buy food by $7.7 billion in the first year, by $19.7 billion in five years, and the balance in the next five years.
“The cuts are expected to die in the Democratic-controlled Senate. But the vote by voice underscored Republicans’ preference for domestic spending cuts over defense cuts or tax hikes as they try to avoid automatic cuts that take effect in January.”
Rep. Tim Huelskamp (R., Kans.), a freshman member of the House Agriculture Committee, was a guest on yesterday’s AgriTalk radio program with Mike Adams where the discussion focused on the upcoming Farm Bill field hearing in Kansas, as well as other Farm Bill issues. An audio replay of this portion of yesterday’s AgriTalk discussion with Rep. Huelskamp and Mike Adams is available here (MP3- 10:20), while an unofficial transcript of the conversation can be downloaded here.
Brett Neely reported yesterday at Minnesota Public Radio (MPR) Online that, “Farmers may face some uncertainty by harvest time as Congress grapples with rewriting the farm bill before it expires in September. On the table are big cuts in federal farm spending.”
“At a recent field hearing in Arkansas, House Agriculture Committee Chairman Frank Lucas, an Oklahoma Republican, sounded optimistic.
“‘We don’t have an easy road ahead of us but I’m confident that by working together we can craft a farm bill that continues to support the success story that is American agriculture,’ Lucas said.”
Federal spending priorities, although always an important consideration, have increasingly become a salient political variable since the financial collapse of 2008. Federal policies to stabilize markets following the U.S. economic meltdown, implemented by both the Bush and Obama administrations, were extremely costly and not without controversy. Projected costs and savings contained in the Patient Protection and Affordable Care Act, which became law in March of 2010, followed by a Tea Party infused midterm election, only served to heighten the budget issue as a potent political consideration for lawmakers.
Following the 2010 elections, voters observed ongoing negotiations between the GOP Congress and the Obama administration over the issue of the federal debt (see “Obama vs. Boehner: Who Killed the Debt Deal?”) where a “grand bargain” on federal tax and spending issues was never reached. The negotiations culminated last summer in the creation of the “Super Committee,” which itself failed in November. In the meantime, the U.S. had it its credit rating downgraded.
Last month, the House of Representatives passed a FY 2013 budget outline which has now become an issue in the 2012 presidential campaign- last week President Barack Obama sharply criticized it, while the presumptive GOP nominee Mitt Romney embraced it.
Rep. Tom Rooney (R., Fla.), the Chairman of the House Agriculture Subcommittee on Livestock, Dairy and Poultry, was a guest on yesterday’s AgriTalk radio program with Mike Adams where a portion of the discussion focused on Farm Bill issues. An audio replay of this portion of yesterday’s AgriTalk discussion with Chairman Rooney and Mike Adams is available here (MP3- 6:42), while an unofficial transcript of this portion of the conversation can be downloaded here.
With respect to the prospects of completing a Farm Bill by September, Chairman Rooney indicated that, “Well, despite the fact that this Congress has been very partisan and very polarized, I am somewhat optimistic that because our chairman, Chairman [Frank] Lucas [R., Okla.], has been able to work with Democrats in the Senate previously this year on what language would be and what cuts would be made, that there is a framework in place right now, as we speak, at least amongst members of the House and the Senate, on the agriculture committees.
“Whether or not we can expand that to getting enough votes in the greater House and the Senate and send something to the president remains to be seen, but I think that the Senate is going to start taking this up in April and May, and then we will begin to take it up in May and June. That’s what Chairman Lucas has told me.”
Chairman Rooney added that, “But again, trying to be the optimist here, we do have some agreements, we do have some framework in place, and a lot of members on both sides of the aisle that represent agricultural districts tend, from what I understand – and this is my first farm bill – to put partisanship aside for this kind of a vote.”
Farm Bill: Revenue Loss Assistance Program- Regional Policy Perspectives
A news release yesterday from Sen. Kent Conrad (D., N.D.) indicated that, “Senators Kent Conrad and John Hoeven [R., N.D.] met with agricultural and agribusiness leaders from across North Dakota today to detail bipartisan legislation they crafted that will maintain a critical safety net for North Dakota farmers and serve as a major component of a new Farm Bill.
“‘We are facing serious budget constraints that make the development of this new Farm Bill more challenging than anything we’ve seen in the past,’ Senator Conrad said. ‘Senator Hoeven and I carefully crafted our legislation with the help of North Dakota’s producers. They told us that we need to maintain a strong crop insurance program. This legislation does just that while also contributing to deficit reduction.’
“‘Producers throughout our state have been telling us that good crop insurance is the foundation of a strong farm safety net and their number one priority,’ Hoeven said. ‘That is just what we have worked to craft in this bipartisan legislation, which is the most cost-effective approach that will enable us to save money to help reduce the deficit, while providing our farmers and ranchers with strong support.’”
Carol E. Lee reported in today’s Wall Street Journal that, “President Barack Obama delivered a blistering critique of the House Republican budget Tuesday, calling it a ‘radical’ proposal, ‘a Trojan horse’ and ‘a prescription for decline’ and tying it directly to Mitt Romney, the GOP candidate the White House believes Mr. Obama will face in November.”
The Journal article noted that, “House Speaker John Boehner (R., Ohio) dismissed Mr. Obama as ‘unserious’ about tackling the country’s economic challenges because he is focused on campaigning over governing.”
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Posted by Keith Good • May, 11, 2012 • 4:07 am 