Farm Subsidies

Good article from Philip Brasher, writing for the Gannett News Service, on the issue of federal farm subsidies. Apparently the farm bill – or at least key parts of it — were going to get stuffed into the “supercommittee” process and hidden from the light of day.

The most vocal critics of government spending in Congress are often right on board with the farm bill. It has money flowing to the right kinds of people – big agribusiness and rural voters who tend to vote for Republicans. The farm bill is a good way to determine who is actually against big government and government spending; and whose opposition to government spending is merely pretext for opposing government money going to the wrong sorts of people.

As to the supercommittee process, the article reports:

Committee leaders and many farm groups had embraced the idea of enacting the bill as part of the supercommittee process because that would have protected the agricultural programs from attack by urban lawmakers, who think farm bills unfairly promote industrial-scale agriculture, and tea party conservatives, who don’t like farm subsidies in general. Under rules for the supercommittee process, the House and Senate would have had to vote on any plan the committee recommended without being able to make any changes, including in the farm provisions.
. . .
Leaders of the National Farmers Union and the American Farm Bureau Federation, groups that often diverge on farm policy, say it will be a good idea for lawmakers to rethink key portions of the bill that the committee leaders were writing. Farm Bureau, the more market-oriented of the two organizations, doesn’t like a proposed revenue-protection program that corn, wheat and soybean farmers wanted. The program removes so much risk from planting decisions that it will discourage growers from responding to market signals, the Farm Bureau says. Under the way that program was designed, growers could get a government check anytime their revenue falls more than 13 percent below their average, shielding producers from drops in commodity prices and crop yields.

The National Farmers Union, meanwhile, is unhappy with the way an optional price-guarantee program was designed. The price guarantees are skewed in favor of rice growers and other farmers who backed the program. Rice growers would get payments when the price of their crop is under $13.98 per hundred pounds, a level that exceeds forecast market prices for the next several years. For many other commodities, the guarantees were set well under market prices. The imbalance was intentional; rice growers don’t believe they would benefit from the revenue-based subsidies.