Now in the final stages of Senate mark-up, the 2012 Farm Bill will no doubt see its fair share of reduction in government program funding. Crop subsidies are an easy target that most people can live with — even farmers. Farmer group leaders have noted that the direct payments programs first authorized in the 1996 Farm Bill were temporary measures that have outlived their necessity.
Jon Scholl, president of American Farmland Trust (AFT) said last year, “ … our country must address the national debt level — with no options left off the table. The direct payments program — in which farmers receive payments without regard to need — has long been a staple in farm policy and appears likely to change. Numerous producers across the country have told AFT that they would welcome change in farm programs, and I believe the 2012 Farm Bill represents an opportunity to create a better safety net.”
With recent University of Illinois reports indicating net returns for 2012 at $269/acre for corn and $136/acre for soybeans, one can easily argue the farmers no longer need such a “safety net.”
But one Farm Bill cutback that few in the agriculture industry are content to make is in research. According to the American Enterprise Institute (AEI), agricultural research and development boasts high rates of return — in excess of 30%. Unfortunately, R&D investments have withered away steadily since the late 1980s and have resulted in plummeting productivity growth rates.
An AEI report concluded that annual spending on ag R&D for productivity growth must increase by $1 billion to prevent further losses in farm productivity and increase competiveness — a goal that is highly unlikely to materialize given the current economical climate. Agriculture research is considered discretionary spending — the kind most likely to be targeted by the Farm Bill next year.
The House Appropriations Committee’s agriculture subcommittee already approved its version of the FY2012 funding bill and cut the research budget by 13.7% from last year. If those cuts become law, federally funded ag research would drop by 20% from the 2010 fiscal year — more than $600 million.
The full benefits of ag research take time to materialize — in the form of minimizing crop threats and curing animal diseases — so now is hardly the time to be tight-fisted with the purse strings, given the already high price of food and no decline in the foreseeable future.
Cutting spending to reduce the financial burden for future generations is a worthy cause, and sacrifices must be made somewhere. But let’s not sacrifice our future ability to provide a safe and steady food supply for our children and grandchildren.