News

Direct payments big part of debate

During his testimony at the House Agriculture Committee’s farm 2012 bill hearing Thursday, Purdue University ag economist Otto Doering said direct payments to farmers don’t address the volatility of crops prices, are viewed negatively by the public, and are too expensive, “I think we’re going to have to look seriously – I would argue at folding down or discontinuing direct payments.”

Doering says the “three-legged stool” of traditional safety net programs, insurance and disaster payments should be considered in total, “They should be crafted together – looking at the influence of each upon the other. We have not been able to do that successfully in the past.”

He says Congress has never been unwilling to give disaster aid to farmers in trouble, even though that tends to undermine crop insurance and payments.

Committee member Stephanie Herseth-Sandlin of South Dakota says direct payments will be one of the key issues in formulating the next farm bill, Rather than taking the money and dedicate it to direct payment, putting it into other titles of the bill or using it for other purposes to lower the overall baseline – we really do want to strengthen the safety net through other programs, whether it is the marketing loans or reforms that we can make to the crop insurance program that has been the subject of those field hearings.”

More field hearings are scheduled next week.