House GOP Would Like to See 14 Percent Cuts to USDA, FDA

House Republicans would like to to cut spending at USDA and the Food and Drug Administration by as much as 14 percent for the government’s fiscal year ending Sept. 30.

Under new House rules, Budget Committee Chair Paul Ryan (R- WI) has nearly unilateral control over discretionary spending levels for the federal budget.

This would amount to $3.2 billion of what the two agencies received in fiscal 2010. The details haven’t been ironed out, but if Republicans succeed in their plan to roll back spending to 2008 levels, the largest cuts would be in food safety programs at USDA and FDA and in USDA’s Women, Infant and Nutrition program, according to Ferd Hoefner, a policy analyst for the National Sustainable Agriculture Coalition.

Stabenow Pledges Bipartisan Approach to Farm Bill

Sen. Debbie Stabenow (D-Mich.)

In an address to the Michigan Agri-Business Association’s Winter Conference, Sen. Debbie Stabenow (D-Mich.), the new chairwoman of the Senate Agriculture Committee, promised a bipartisan approach to the 2012 farm bill. She also said sound science must drive agricultural policy.

“With almost 7 billion mouths to feed around the globe, we need American leadership in innovation, biotechnology and increased efficiency to make it possible to feed the world,” Stabenow said. “To foster that innovation, we need a regulatory system that is science-based and efficient—and we also need to open up markets.”

Direct Payments Remain in Policy Book

It was supposed to be one of the biggest and most controversial issues in Farm Bureau policy this year. The showdown between states that supported the elimination of direct payments and those that favored keeping them was supposed to take up much time on the delegate floor.

Except that’s not what happened.

The much anticipated squabble over direct payments never really developed. The discussion  passed quickly with most delegates in favor of keeping them in the mix of farm programs in the next farm bill. The delegates easily passed a resolution that called for ” a strong and effective safety net that consists of  direct payments, crop insurance, and a simplified ACRE program.”

While the delegates refused to pull their support for direct payments, they did pass a policy stating that farmers must purchase crop insurance if they wish to be eligible for farm program benefits.

Yuma County Farm Bureau authored Colorado’s policy rejecting direct payments. President Nathan Weathers is not pleased with the short shrift given to that position as the delegate session.

“I’m really disappointed,” he said. “I think we missed a great opportunity to show both politicians and the public that we are committed to doing out part in helping to climb out of debt.”

Weathers says he heard from many producers at the Annual Meeting that still did not see the negative light that commodity payments put farmers and ranchers in.

“I heard so many people tell me that they ‘weren’t giving up their government payments’ I couldn’t believe it,” he said.

Iowa and Colorado Farm Bureau were two states that favored the elimination of the payments. Most southern suggested retaining them.

Farm Bill Cuts Would Make Tiny Dent in Deficit

As discussion develops on writing a 2012 farm bill and reducing the federal budget deficit, there may be talk of cutting “farm subsidies.” But the Food and Agricultural Policy Research Institute at the University of Missouri points out that such cuts would make just a tiny dent in the federal budget deficit.

“Defenders of current farm programs can point out that farm program spending is a tiny share of federal expenditures,” said Pat Westhoff, FAPRI’s director. “Eliminating all farm programs would hardly make a dent in the budget deficit.”

Even if USDA’s budget is not cut in 2011, farm program spending will be under a lot of scrutiny when the next farm bill is debated, according to Weshoff. “It is hard to guess where spending cuts might be made,” he said. “It seems likely, however, that an effort will be made to further reduce USDA spending.”

CRS Outlines Farm Bill Issues

FarmPolicy.com reports today on a report by the Congressional Research Service (CRS) outlining the biggest issues for the next Farm Bill. The report mentions increased calls for a departure from direct payments in favor of expanded insurance and disaster programs, and linking payments to farm revenue as opposed to commodity prices.

“Managing farm risk—Crop insurance has very high participation rates, a result driven in part by the high subsidization levels but also because the program in fact reduces both yield and revenue risks. Some members of Congress and policy observers have wondered if crop insurance might be the only element of the farm safety net that remains in the distant future if farm programs are rationalized and funding is reduced.

FarmPolicy.com extensively covers all the news about Farm Bill issues on a daily basis. It is a one stop shop for all things Ag policy related. Check it out!

Colorado Farm Bureau: Eliminate Direct Payments

Delegates to the 2010 Colorado Farm Bureau Annual Meeting last month approved a policy that supports the elimination of direct payments in the 2012 Farm Bill. The policy favors an expanded revenue insurance program and improved risk management tools.

“Our delegates decided that the industry needs to make tough decisions like these. I think they did the responsible thing,” said CFB President Don Shawcroft.

Nathan Weathers, President of Yuma County Farm Bureau where the policy originated says that the ag industry needs to do its part in contributing to the reduction of the federal debt.

“Crop Insurance is a true safety net for farmers. By moving away from a direct and counter-cyclical program to a more comprehensive crop insurance program, we want to demonstrate our willingness to work together to cut the budget during tough economic times.”

He also says that this change in direction shows that farmers are not looking for a handout from the taxpayers.

The policy recommends expanding the current crop insurance program to allow for insuring 100% of a producers proven yield. Weathers says that this will satisfy lenders who count on clients receiving direct payments.

The policy easily passed the vote of the delegates and will be forwarded on to American Farm Bureau for consideration at the 2011 Annual Meeting in Atlanta next month.

Deficit Comission Plan Includes Cuts to Farm Programs

On Wednesday, a 10 percent cut in farm support programs was proposed by an 18-member bipartisan commission intent on balancing the federal budget. A vote by the commission on the overall plan, which encompasses the entire federal government, is expected Friday.

A net cut of $10 billion ($1.25 billion per year) through 2020 in Agriculture Department spending was proposed, with the reductions coming mainly from crop subsidy and land stewardship programs such as the Conservation Stewardship Program and the Environmental Quality Incentives Program. The Conservation Reserve Program was not singled out for a funding cut.

Oklahoma Farm Bureau Supports Direct Payments

Sets Up Policy Fight at National Level

Update: AFBF President Stallman affirms direct payments debate will be issue #1 at AFBF Annual Meeting.

Setting up a potential policy battle between proponents of direct payments and those that favor risk-management programs, the Oklahoma Farm Bureau resolutions committee voted earlier this week that the next farm bill should continue direct payments to farmers.

“Our top priority is the continuation of direct payments,” stated OFB President Mike Spradling. “The payments provide producers flexibility to grow various crops while providing income support.”

Recall that earlier this year the Iowa Farm Bureau voted in favor of ending direct payments in the next farm bill in favor of an expanded crop insurance and Average Crop Revenue Election Program.

The policy differences will be debated at the upcoming AFBF Annual Meeting in Atlanta where either side could emerge the victor. Many other states are assessing their position on farm bill programs and members should expect states to form coalitions early on in the policy development process.

Iowa Farm Bureau: Eliminate Direct Payments

Direct payments to farmers should be eliminated in favor an improved revenue insurance program and a contribution to federal deficit reduction.

A resolution to that effect was passed by Iowa Farm Bureau delegates at their summer policy conference Friday.  “What we did was left the policy open saying we’ll remove the direct payments, but if we remove the direct payments we have to have a revenue protection product,” says Iowa Farm Bureau president Craig Lang, “and it didn’t say ‘90 to 95 percent of your revenue’,  but that’s what they talked about. We have to have a better safety net than we have today.”

The policy also calls for the ACRE program to be based on county, rather than state, yields and revenue—and to include revenue protection for livestock as well.