2012 Farm bill debate rolls into deficit drama

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September 6, 2011 - 7:00pm

As Congress returns from its August recess, the decisions of the "super committee" assigned to solve the nation's debt problem are front and center.

The committee is tasked with identifying $1.5 trillion worth of cuts over the next 10 years, and agriculture programs are among the targets. At the same time, the Senate and House agriculture committees are ramping up on the 2012 Farm Bill, a huge piece of legislation that dictates U.S. agriculture policy.


Clay Masters, NET News

Farm industry heads talked with radio station KRVN for a farm bill forum at the Nebraska State Fair on Monday, August 29, 2011

Hilary Stohs-Krause, NET News

Source: USDA, Economic Research Service using Congressional Budget Office Estimates

Click the image for the full text of the 2008 Farm Bill.

Nobody's saying a farm bill will be written in these next six weeks, but projected cuts in the weeks ahead could create a whole new playing field.

In what was likely the last farm bill hearing outside Washington before the deficit discussion takes center stage, agricultural producers had a strong message for the Senate Agriculture Committee: Don't touch crop insurance.

But in today's economic climate and amid budget stalemates, committee chairwoman Debbie Stabenow acknowledged to the Wichita, Kan., crowd that everything is on the table.

"Bottom line, I think it's clear that we in agriculture must make some tough decisions or somebody else is going to make them," Stabenow said.

Stabenow said the field hearing - one of two held this year - provided an important connection to agriculture stakeholders going into the budget debates.

"We know everybody in farm country and every rural community understands that they have to do their part like everybody else," Stabenow said. "But we also know it has got to be done right and that's what we are committed to doing, and it's got to be fair for agriculture."

The U.S. House of Representatives passed a bill earlier in the year to cut $48 billion from agriculture but it didn't get the necessary votes in the Senate. And a deficit reduction deal this summer didn't make any immediate cuts to agriculture, something Stabenow described as a "short term victory."

During the hearing, Sens. Stabenow and Pat Roberts tried to soothe ag anxieties by pointing to the experience of the Senate Agriculture Committee as a plus in developing smart policy solutions within budget constraints. The committee includes Sen. Kent Conrad, the chairman of the Budget Committee; Sen. Max Baucus, chairman of the Finance Committee; and former Agriculture Secretary Michael Johanns. Baucus is also one of 12 on the deficit reduction super committee.

But the farm bill process may be turned on its head by the super committee.

"Traditionally Congress has respected farm bill process by not opening the farm bill, giving it a five-year window in order to provide certainty to farmers and ranchers," said Rep. Jeff Fortenberry, a Nebraska Republican who serves on the House Agriculture Committee.

Typically, the House and Senate agriculture committees draft proposals and then hash out differences before it goes to Congress. But Fortenberry said that the budget situation means that specific programs in the farm bill may be debated in front of full Congress this fall.

Brad Lubben, a University of Nebraska-Lincoln Extension specialist, said the farm bill process will operate on the same timeline, with a completion target of the end of 2012. What speeds up the debate are parallel discussions of the super committee.

"There are a lot of watchers in the current debate thinking that the real farm bill debate is happening in the next two to three months as the committees surface possible budget cuts and really rewrite some of the funding levels for federal programs, including some of the farm programs," he said.

But there's also the big "what if" situation if the super committee does not reach a deal or if Congress doesn't pass a bill. Across-the-board cuts would ensue.

"If everything is sort of equal across programs, the proposed cuts might amount to 15 percent or more percent more of current spending," Lubben said. "Then you have the challenge of how do you maintain a safety net with 15 percent fewer dollars."

The Senate and House Ag committees have until Oct. 14 to give their budget recommendations to the super committee. The super committee then has until Nov. 23 to come up with a deficit reduction plan. It may be Christmas before the farm bill landscape is clarified as super committee proposals must be voted on by Dec. 23.

"Nobody really knows for sure how this is going to play out in relation to working with this super committee and what they come up with," said Troy Dumler, an agriculture economist with Kansas State University Extension. "So it's somewhat of a wait-and-see situation right now."

In the last farm bill negotiations, extensions allowed the debate to go until May of the next year, following the September 2007 expiration date.

"It's complicated because there's so many different types of programs, so many different groups that are interested in it and have a role in developing it," Dumler said.

Regardless of what cuts do come, Dumler said, the agricultural markets have developed to help deal with the uncertainty - and it helps that the farm economy is doing well.

"If there has to be cuts going forward, I think now is the best time to deal with those, because we are overall in a better situation than we were 10 years ago," he said.

Harvest Public Media's Eric Durban contributed to this report.



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