By Rick Dandes
The Daily Item
SUNBURY — Both chambers of Congress have started laying the groundwork on a massive farm bill that would cut spending while also creating new subsidies for farmers.
The Senate bill calls for roughly $2.4 billion a year in cuts, while a House version would save $4 billion out of about $100 billion annually. The reductions would include more than $600 million in yearly savings from across-the-board sequester cuts that took effect this year.
Much of the savings in the House and Senate bills would come from eliminating the direct payments, which aren’t tied to production or crop prices. Part of that savings would go toward deficit reduction, but the rest of the money would create new programs and raise subsidies for some crops while business is booming in the agricultural sector.
Several Valley farmers, when asked about the bills, said they needed to know more.
David Heimbach, a Selinsgrove-based dairy farmer who recently won the Republican nomination for Monroe Township supervisor, said he didn’t know much about the bill and wanted to reserve judgment until he saw the final language.
The bills include generous protections for crops. Both versions would boost federally subsidized crop insurance and create a new program that would cover smaller losses on planted crops before crop insurance kicks in, favoring corn and soybean farmers who use crop insurance most often.
“All of the changes are meant to make farm programs more efficient,” said Mark O’Neill, a spokesman for the Pennsylvania Farm Bureau, based in Camp Hill.
“Instead of subsidies that pay out every year even in good times, the bill creates risk management tools that support farmers when they are negatively impacted by weather, disaster or market events beyond their control,” he said.
Lewis Merchant, of Beaver Springs, a grain farmer, when told of that provision, thought it might be a good thing. “But I’ll wait and see what the final bill reads like. I don’t trust Washington, to be honest. What you’re telling me now and what I see in the end, that could be two things different,” he said.
Longtime critics of farm policy say that even with the belt-tightening, the legislation is still a giveaway to the largest farms, which tend to receive the largest shares of the subsidies.
Farm groups defend the policy by using last year’s drought as an example. Despite widespread losses, federally subsidized crop insurance helped farmers recover.
O’Neill said, “Farmers across Pennsylvania are willing to make sacrifices as part of the overall farm bill package, including the elimination of direct payments, which total $5 billion per year in the proposal approved by the Senate Agriculture Committee.”
He said the Pennsylvania Farm Bureau is pleased that the Senate Agriculture Committee has advanced a farm bill that places a high priority on crop insurance as a risk management tool and includes additional insurance opportunities for fruit and vegetable growers.
“We are hopeful,” he said, “that the bipartisan legislation, which includes a flexible crop insurance program and a streamlined conservation program that focuses on working lands, will move swiftly though the full Senate.”
Meanwhile, O’Neill said, it’s important for the public to know where money from the farm bill actually goes.
The proposed $100 billion bill directs $80 billion, or 80 percent of all farm bill funding, toward food stamps and other food nutrition efforts under the Supplemental Nutrition Assistance Program, or SNAP.
The remaining $20 billion — one half of 1 percent of all federal spending — is targeted to help farmers afford crop insurance coverage as part of the agriculture safety net and to assist farmers in implementing conservation practices that reduce soil erosion, limit runoff and improve water quality.
The House and Senate bills are far apart on SNAP allotments, O’Neill said.
The Senate bill would cut $400 million out of almost $80 billion spent annually on SNAP. In order to appease conservatives, the House bill would cut $2 billion annually from the program and rewrite policy that allows some people who already receive benefits to automatically receive food stamps.
Balancing the cutbacks is important to conservatives while maintaining the generous safety net that farmers have relied on for decades will be key to getting the bill passed before current farm programs expire Sept. 30.
This is the third year in a row that farm-state lawmakers have tried to push the bill through. Although it passed the Senate, the House declined to take up the bill last year after conservatives in that chamber objected to the bill’s cost and insisted on higher cuts to food stamps.
House leaders have given supporters more optimism this year as they have said they plan to put the measure on the floor this summer.
Another battle is expected over the refusal of both committees to include a provision backed by the Obama administration to switch U.S. food aid from one that relies mostly on shipments from U.S. farmers to more of a voucher system in which food commodities would be purchased from producers in the recipient nations.
Farmers and shipping companies oppose the change, pointing to a big hit on their bottom lines and what they call the unreliability of many foreign governments to use financial aid wisely. Supporters said it would reduce costs and build up foreign agricultural production so recipient nations would become less dependent on the United States.