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Talk of Farm Bill rewrite is premature
Rep. Collin Peterson (D, MN) ruined my week. The House Agriculture Committee’s ranking member and former committee chair told a Minnesota radio station this week that low commodity and dairy prices could force his committee to write a new Farm Bill next year rather than waiting for the current farm policy package to expire in 2018.
“Writing” a new Farm Bill has always been and will always be one of the most painful legislative experiences around. To me, it’s the best example of why legislation and sausage making should never be observed.
Peterson said the problem with the current Farm Bill now in effect is that it was written during a time of high prices and income safety net programs are not sufficient to deal with the current downturn in prices to farmers. This was a warning that echoed down the halls of both the House and Senate when the last Farm Bill was hammered together going back to 2011. Today, just look to the record USDA payments announced this week in the newly minted Margin Protection Program (MPP) for dairy. Just over $11 million was sent to a fortunate subset of dairy farmers this week – those who bought protection at the right dollar level – to offset income losses from falling domestic/world milk prices and narrowing margins.
“It hasn’t gotten to be too much of issue so far, but I think this winter is going to be a big problem,” Peterson told the Minnesota News Network during an appearance at Minnesota’s FarmFest. “If it gets bad enough, it might force us to move a year early on the Farm Bill, which wouldn’t be a bad idea.”
Ironically, I saw Peterson’s comments just after reading a synopsis of recent polling showing farmers and ranchers are more optimistic about the coming year than they’ve been in recent years. They’re apparently ignoring both presidential hopefuls and their zeal to throw trade broadly and the TransPacific Partnership (TPP) specifically under the election bus. As I said a week ago, U.S. agriculture does not grow unless it can exploit a global marketplace.
Sen. Pat Roberts (R, KS), chair of the Senate Agriculture Committee and a veteran of more Farm Bills than any sitting member of Congress, has said nothing public about writing a new Farm Bill before the current package expires. This may be because he’s too busy protecting the current Farm Bill from being pillaged by budget and appropriations committee members when they go on their annual cost-cutting raids. I’m sure the memories of the pain in getting the last Farm Bill enacted are also still too vivid.
House Agriculture Committee Chair Mike Conaway (R, TX) is also silent on any schedule for Farm Bill rewrites. Conaway is playing his cards close to the vest, but he’s busy identifying issues within his committee’s jurisdiction important to urban House members as a means to build support for a new Farm Bill when it comes. This includes finding a solution to why Americans “wastes” up to 40% of the food they buy and maintaining the increasingly toxic political marriage of farm programs and the federal food stamp program in the same legislative package to balance urban and rural interests.
Peterson said talk of stripping the food stamp program out of the Farm Bill is unrealistic. “What’ll happen if you split them, food stamps will go on and the Farm Bill will end because there’s nobody to vote for the Farm Bill,” Peterson said. “People just don’t get it. They’re not going to get rid of food stamps. It’s just not going to happen.”
I’m hoping the same for a 2017 rewrite of the Farm Bill.
The farm bill was designed so that most crop farmers would sign up for revenue insurance (ARC) though most had rejected it (ACRE) in 2008. It was designed with no fixed standard of fairness (i.e. cost of production,) with the free market dictating “need.” (If you get $15.00 for corn as an Olympic average, and it falls to $12, you need big subsidies. If you get $1.00 and it rises to $1.50, you have no such needs.) So since CBO (& ERS) are projecting cheap price for 10 years, subsidies will be lower, as the need stays high. Of course, it’s all to secretly subsidize the corporate buyers (including foreign buyers), as there’s no price floor. With adequate price floors there’d be no need to write a check to everyone in the failed market. (Free markets chronically fail for agriculture.) Free trade agreements only help lower market prices, as they help the mega-corps to play one country off against another. After we ended price floors in 1996, the massive failure of the program was almost immediate, (and has continued to today for all but corn, soybeans and rice, which had prices above full costs for 7 years). To hide the failure of conservative free market ideology, they passed 4 emergency farm bills after 1996 and before 2002, pumping in more taxpayer money while losing money on exports. Corn and soybeans saw 8 of the 9 lowest prices in the history of USDA data, 1997-2005 and similar for the other major crops.