House Agriculture Committee Agrees on Farm Bill


The following article is from the New York Times:

by Ron Nixon

WASHINGTON — The House agriculture committee early on Thursday voted to pass its version of a new farm bill that cuts $12 billion more from the food stamps program than a Senate bill passed last month and adds several new crop insurance and price support programs to protect farmers during natural disasters or when prices fall.

The House bill, which passed 35 to 11, would reduce food and nutrition spending by more than $35 billion, mainly by cutting about $16.5 billion from the food stamps program. The Senate bill cut about $23 billion in spending, with $4.5 billion in savings coming from food stamps. About 80 percent of farm bill spending goes to food stamps.

“Today marked an important step forward in the development of the next farm bill,” said Representative Frank D. Lucas, Republican of Oklahoma and chairman of the House agriculture committee. “This is a balanced, reform-minded, fiscally responsible bill that underscores our commitment to production agriculture and rural America, achieves real savings and improves program efficiency.”

But even after the agriculture committee vote, several obstacles stand in the way of getting a farm bill to the full House and passed before the election: a short legislative calendar to get work done, fundamental differences between House and Senate versions of the bill and pressure from conservatives for greater cuts in government spending over the objections of liberal lawmakers.

Despite the daunting task, Mr. Lucas said he was determined to get a farm bill to the floor and passed so lawmakers in the House and Senate could began reconciling differences in the two versions.

The House and Senate must reach a compromise before Sept. 30, when the current five-year farm bill, passed in 2008, expires. Like the Senate version of the farm bill, the House bill would eliminate direct payments to farmers — payments paid annually to farmers whether they grow crops or not.

Currently, farmers who grow corn, wheat, soybeans, cotton and other crops receive about $5 billion in direct payments. The payments have become harder to justify as farm income has risen to historic levels. According to the Agriculture Department, net farm income was a record $101 billion last year.

Both the Senate and House versions would replace direct subsidies with various crop insurance programs that would aid farmers in the event of bad weather or natural disasters.

The government helps farmers get some crop insurance through private companies, with the government paying about 62 percent of the premiums, plus administrative expenses. According to an April report by the Government Accountability Office, the cost of that insurance was $7.3 billion last year; by comparison, in 2000, the cost was $951 million, or about $1.2 billion adjusted for inflation. A Congressional Budget Office study report estimates that the total cost of subsidizing the premiums from 2012 through 2016 will be about $39 billion — about $7.8 billion a year.

In addition to the crop insurance program, both bills plow money saved from the elimination of direct payments into several new subsidy programs.

Under the House bill, money is put into new price support programs to see peanut, cotton and rice producers through deep, multiple-year price declines. The price supports and new insurance programs for peanuts and rice address concerns by Southern rice and peanut growers who have traditionally relied more heavily on direct payments. These farmers objected to the Senate’s version of the farm bill saying it did not provide enough of a safety net with the elimination of direct payments.

“The current crop insurance program does not work well for crops like rice,” said Linda Raun, a rice farmer from El Campo, Tex., and chairman of the USA Rice Producer Group, a trade group. “We are happy with what the House has proposed. It recognizes that you can’t have a one-size-fits-all program for all regions and crops.”

Some conservation groups and nutrition groups were less than pleased with the steep cuts to the food stamps program in the House bill. Feeding America, an antihunger group based in Chicago, said the cuts would eliminate nutrition benefits for about three million people, and nearly 300,000 children would be ineligible for the school lunch program under the House proposal.

“With the economy being in such bad shape, depriving that many people of nutritional assistance is going to have a devastating effect,” said Eric Olsen, the group’s senior vice president of government relations and public policy.

Budget watchdog groups also said they were disappointed by the House’s farm bill.

“Rather than simply ending the direct payment program and saving $50 billion, the House instead creates expensive new entitlement programs that could ring up huge costs,” said R.J. Lehmann, public affairs director at the R Street Institute, a Washington policy group. “This is a failure of the freshman class. They came into office promising to cut spending, but you don’t hear a peep of objection from them.”

Source:  New York Times

Posted by Haylie Shipp


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