My View From The Country

Despite Incentive To Act Quickly, Farm Bill Progress Unlikely

There’s a lot of impetus to break the impasse over a new farm bill, but the biggest may be losing control of the process altogether.

Discussions between lawmakers to reconcile the House and Senate versions of the farm bill are now underway after being sidelined by all the budget hoopla of early October. If you believe the politicians, there’s a good chance of a compromise plan emerging from these talks. However, the lobbyists and special interest groups with a stake in the farm bill don’t share that optimism. The differences between the sides are just too large to find a compromise at this point, they say. 

One needs a scorecard to keep track of all the differences. Of course, everything in Washington is budget-driven at this point, and that’s understandable. After all, our government reportedly is spending $200 million/hour more than it takes in, and that’s 24 hours/day, 365 days/year. The situation is even more problematic when one considers that those figures don’t count all the off-book debt we continue to rack up, which makes the $200 million/hour look like pocket change.

The budget that’s been proposed by the Senate is dramatically different from the farm bill passed by the House. This is where it gets confusing. The proposed House budget has no chance of passing the Senate or getting Obama’s signature. However, since the House has the only “real” proposal on the table, it’s the only standard to go by.

The House passed a farm bill that contained only a third of the cuts that the House budget had wanted, which was $184 billion over 10 years. Meanwhile, the Senate’s version only has an eighth of those cuts. Another confusing factor is that the vast majority of the debate centers on the Supplemental Nutrition Assistance Program (SNAP), which used to be called food stamps. SNAP constitutes a huge portion of the budget, so it is where the real contention lies regarding the amount of cuts.

The experts think the gap between the House and Senate versions of the farm bill is just too big to reconcile, even before figuring in the demands that the House budget proposal is making. If the conference committee can’t find a compromise, then the talk is that that another committee will take over the farm bill. This is a new committee that’s been given the task of developing a comprehensive budget, and it will take over the farm bill as its needs to claim the cuts in its calculations in order to avoid the deeper cuts that will take place Jan. 1 due to the sequester.

There are substantive differences between the House and Senate versions on matters that truly pertain to agriculture, but they’re actually relatively minor in comparison. The interesting thing is that if this new committee takes over the farm bill, what emerges could be drastically different than either the House or Senate versions.

One would think such a prospect would increase the impetus for the House and Senate to get something done immediately. However, given recent history, the odds are in favor of the farm bill getting caught up in the overall budget debate.

There already have been attempts to break out the nutrition title from the farm bill, which is where the majority of disagreement resides. But the attempts have failed, so the farm bill will continue to be held hostage by the SNAP debate.

In 2009, the federal economic stimulus increased SNAP funding by about $5 billion; that goes away in November if a farm bill isn’t passed. Thus, the lack of agreement will actually result in a decrease in SNAP funding – about $1 billion larger than even the bill passed by the House. It seems like there’s every incentive to act quickly, but little hope that Congress will be able to.

 

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The freak autumn blizzard in South Dakota also should be adding impetus for quick action. Both the House and Senate versions would reinstate the Livestock Indemnity Program (LIP) that expired in 2011, and would retroactively reinstate the program for 2012 and 2013. This would provide some relief to affected producers. Before anyone gets overly excited about the chance of relief via the LIP program, however, bear in mind that any payments wouldn’t occur for an additional seven months after approval.

Are you confused? Everything is being driven by the budget battle, and any resolution to our fiscal woes seems unlikely anytime soon. As a result, the farm bill will likely be held in limbo, unless the conference committee acts quickly to resolve the differences.

 

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Discuss this Blog Entry 1

Bob Viering (not verified)
on Nov 8, 2013

You might wish to take a few minutes to fact check your opinions prior to posting them. The real numbers for the current deficit spending per hour is 1/3 (per a report from the Heritage Foundation) of what you claimed as a fact. Two, the "off the books" debt you claim is the debt for the Government Sponsored Enterprises or GSE's. This isn't included in government (sovereign) debt because its debt is to fund loan programs including the Farm Credit System and the Federal Home Loan Banks (which many community banks use to fund and manage their interest rate risk allowing them to also offer longer term fixed rate ag real estate loans) and is repaid from loan payments made by farmers and home owners. If you check just a bit further you will see that the GSE's are all profitable and the one that had to get bailed out (Fannie Mae) expects to repay their bail out funds soon.

Suggesting that the House proposal is the only "real" proposal is of course also false. Your article talks about both bills at length and you do correctly state that the major difference is in SNAP spending. So, your real opinion is that SNAP must be cut significantly. Have the guts to say that directly. You might want to take a few minutes to fact check who actually receives SNAP benefits and do a story on that. You might also keep in mind that SNAP is about food purchases and last time I checked, agriculture is about producing food.

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What's My View From The Country?

As a fulltime rancher, opinion contribur Troy Marshall brings a unique perspective on how consumer and political trends affect livestock production.

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Troy Marshall

Troy Marshall is a multi-generational rancher who grew up in Wheatland, WY, and obtained an Equine Science/Animal Science degree from Colorado State University where he competed on both the livestock...

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