Farm bill remains stuck in a muddy field

11/29/2013 12:00 AM

08/08/2014 10:20 AM

Sharon Oetting farms 700 acres of corn and soybeans near Concordia, Mo. The Thanksgiving holiday gives her and her friends and neighbors a chance to celebrate a strong agricultural economy and a good harvest.

If only Washington would get its act together.

Two months after it officially expired, the nation’s overarching food and nutrition legislation — commonly known as the farm bill — remains locked in a bitter stalemate in Congress. Negotiators had hoped to finalize a new farm bill by Christmas; instead, talks have stumbled again, and hope is fading for a solution in the next month.

That means Oetting and her neighbors have little idea what the government has in store for them in the next growing season.

“I’m really disappointed,” she said. “It is difficult. It is challenging. You’re just kind of in limbo.”

Oetting’s concerns aren’t limited to farmers. Without a new farm bill by Jan. 1 — or an extension of the expired old bill — the price of a gallon of milk could double. Beef exports could drop, eventually causing ranchers to reduce their herds and drive up the cost of a hamburger.

Farm communities that depend on the sale of seed, fertilizer and farm equipment might also suffer without the certainty of farm legislation.

Agriculture Secretary Tom Vilsack, in Kansas City for a recent roundtable on the bill, urged Republicans and Democrats to find a compromise, and quickly.

“It’s a food bill. It’s a research bill. It’s a jobs bill. It’s an energy bill. It’s a conservation bill,” he said. “It’s all of that, and it benefits every single American, every single day.”

But Vilsack’s speeches over the past year have failed to sway Republicans and Democrats in Congress, who remain stuck over the bill’s main provisions.

The measure now under general discussion would spend roughly $100 billion a year over the next 10 years. Of that, $20 billion annually would go for farm-related subsidies and programs, while $80 billion would be spent for nutrition programs, including the Supplemental Nutrition Assistance Program, or food stamps.

Both parts of the bill have been sharply criticized.

Opponents of farm subsidies say they’re unnecessary as the agricultural economy booms — land prices are rising, and prices for most commodities, although not all, have remained relatively high.

Net farm income is projected at $131 billion this year. Adjusted for inflation, that’s the highest it has been since 1973.

“The cost of subsidies is not just limited to the burden on taxpayers,” wrote Daren Bakst of the Heritage Foundation, a conservative think tank. “Consumers are also harmed because of higher prices that result from artificial attempts to drive up prices.”

A recent dramatic drop in corn prices, however, prompted in part by struggles with ethanol, may soon increase pressure on Congress to reach a deal.

Congressional negotiators already have reached a broad consensus that the new bill should eliminate direct payments — taxpayer money automatically sent to some farm operations regardless of crop prices. That should save $5 billion a year.

But there is still a major dispute over federally subsidized crop insurance. Farmers say they need that taxpayer support to manage risk, while opponents say the insurance is too costly and unfairly benefits just one segment of the economy.

The dispute over farm subsidies, though, is tame compared with the ongoing battle over the food stamp program, also called SNAP.

The Senate passed a bill earlier this year cutting food stamps by about $4 billion over the next 10 years. House GOP leadership responded with a recommendation for deeper cuts: $20 billion over the same decade.

That wasn’t enough, though, for some conservatives. They wanted $39 billion in total food stamp cuts through 2023 — reducing the amount spent on SNAP in the final year from roughly $80 billion to $76 billion.

“There won’t be needy people that are taken off this,” said U.S. Rep. Steve King of Iowa, a Republican, during debate on the SNAP reform bill. “There isn’t going to be food coming out of the mouths of babes. … This is so that the resources are available to the people that need it, those that are truly hungry.”

Eventually, the House split the farm subsidy program away from food stamps and then passed two measures, including the $39 billion food stamp cut.

Sen. Pat Roberts, a Kansas Republican, is the only member of Congress from Kansas or Missouri working on reconciling those deep food stamp cuts with the Senate’s more moderate approach.

He isn’t sure there’s any common ground on the program.

“It’s going to be very difficult,” he said during a recent area visit. “We have to convince people it’s never the best possible farm bill, it’s the best bill possible. We’ll see if that works.”

But Democrats are adamant that food stamp funding has been cut enough already. Additional food stamp spending that was part of the 2009 stimulus recently expired, requiring a benefit cut for almost every recipient this fall.

“We reformed it, we made it better and we saved money,” said Sen. Claire McCaskill, a Missouri Democrat. “We can do more. But we can’t do $40 billion” in cuts.

Said U.S. Rep. Emanuel Cleaver of Missouri, on the House floor: “Over 70 percent of the people receiving SNAP benefits are the elderly, the disabled and children. And we are against helping them?”

If negotiators are unable to bridge that policy gap by the end of the year, dairy consumers may be the first to feel the impact.

Without a new bill, or an extension of the old one, provisions of a 1940s-era farm law begin to lock into place. That permanent law requires the federal government to buy up milk, cheese and other products at price levels high enough to push a gallon of milk to $7. (It’s about $3.50 today.)

Without a farm bill, “I basically create shortages in grocery stores across America,” Vilsack said in Kansas City. “Milk. Butter. Cheese. Eventually, rice. Corn. Wheat products. There’s no question that’s going to happen. The law requires me to do it.”

The Democrat also said he opposes a temporary extension of the current bill. “We ought not to be governing by crisis,” he said.

Some farmers have suggested a different compromise: end all farm subsidies.

“Let farmers be farmers, and let the public tell them through the marketplace what it would like them to raise,” Harlan Anderson, a farmer and veterinarian in Minnesota, wrote in a column this month.

But asking the agricultural community to end subsidies, uh, cold turkey, seems unlikely.

“I don’t think there’s a farmer out there that doesn’t want to see us have a farm bill,” Oetting said.

“And it’s important to consumers, too. Many of them don’t realize it.”

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