At her last Farm Bill hearing this week before embarking on committee mark-up of a 2012 Farm Bill, Senate Agriculture Committee Chair Debbie Stabenow (D, MI) declared “the era of direct farm payment is dead,” but also said the challenge is finding “the right mix” of program replacements to satisfy commodity groups.
Commodity group witnesses told the committee that whatever it does, it cannot impose programs that interfere with a farmer’s ability to decide what to grow and how much, that the new Farm Bill has to pave the way for younger farmers to get into business and that new programs can’t create trade problems that trigger formal international actions.
Producer group and government witnesses appeared to talk about the need for program reform, with farm witnesses declaring federal crop insurance must be the lynchpin for program reinvention, and USDA’s witness, Michael Scuse, acting undersecretary for farm and foreign ag services, urging the committee to make only “simple and workable” changes to existing programs. Given Stabenow’s declaration and the efforts so far this year by the various commodity interests in rewriting farm programs, that request likely fell on deaf ears.
The farm group witnesses opposed any spending cuts on crop insurance, reminding the lawmakers once again that the federal crop insurance program has absorbed $6 billion in budget reductions over the last 10 years. The rice industry witness, however, departed from the groupspeak on crop insurance, urging the committee to consider the damage that will be done to his industry if target prices and direct payments end. He told the committee rice growers don’t benefit from insurance to the degree midwestern crop growers do, explaining production is irrigated and able to withstand drought, but not the added costs of pumping water into fields.
Sen. John Boozman (R, AR) urged his committee colleagues to not write off target prices altogether, but was challenged by Sen. Mike Johanns (R, NE) who called the pricing scheme a bad idea, the exchange illustrating the regional differences that are the biggest challenge to rewriting direct payment programs. Another contentious issue raised during the hearing was a proposal that conservation compliance program benefits be tied to crop insurance purchases, a move opposed by the American Soybean Assn. (ASA) and others. Roberts said the notion that ending direct payments ends conservation compliance is a “myth,” but added a crop insurance hook could be added to other program eligibility.