Written by Ferd Hoefner, NSAC Policy Director

Three Senators reversed their previous positions in support of farm program subsidy reform, providing the deciding votes to defeat a subsidy reform amendment offered in Senate Budget Committee by Senator Chuck Grassley (R-IA) and backed by President Obama and USDA Secretary Tom Vilsack.

Last year, all three — Robert Byrd (D-WV), Patty Murray (D-WA), and Ron Wyden (D-OR) — voted in favor of the Grassley pro-family farm amendment to the budget resolution and it passed 13-9.  Today the same amendment went down to defeat on a 10-13 vote after the three reversed their vote.

Switching from anti- to pro-reform was Ben Cardin (D-MD).  First time voters on this issue split – new Senator Jeff Merkley (D-OR) voted with the reformers, while new Senator Mark Warner (D-VA) voted against family farmers.

In a successful attempt to pull votes away from commodity reform, Budget Committee Chairman Kent Conrad (D-ND) offered an alternative amendment to cut crop insurance funding instead of reining in million dollar government payments to the nation’s largest farms.  That amendment in support of lower crop insurance support was passed on a 14-10 vote.  Conrad also played the lead role in defeating commodity payment reform during Senate consideration of the 2008 Farm Bill.

Both the successful Conrad amendment and the defeated Grassley amendment actually do the same thing — reduce spending designated for the budget function for farm support and shift part of the savings to the budget function for nutrition programs.  How such savings would be ultimately achieved is up to a plan devised in the Agriculture Committees, not the Budget Committee.  The Budget Committee, though, makes assumptions about where the money comes from.

The Grassley amendment savings assumed eventual passage of the Dorgan-Grassley bill, a measure to place a hard cap of $250,000 on annual payments per farm.  That bill was supported by a majority of Senators during the voting on the 2008 Farm Bill and was endorsed last month in President Obama’s budget proposal to Congress.

Both the Grassley amendment and the Obama proposal would use the savings from stopping payment abuse to help pay for enhanced child nutrition.  Congress will be reauthorizing the Child Nutrition Act later this year, and a significant issue will be where to find savings to bolster school feeding programs.

The effort to reform farm subsidy payments strongly supported by the White House and USDA does not die with the defeat of this amendment. Not only will the Child Nutrition legislation be pending later this year, but the Administration has a significant opportunity to reform farm subsidy programs that does not need new additional legislation. The congressional report accompanying last year’s farm bill directed USDA to rewrite the regulations for determining who is eligible to receive payments and determining what constitutes schemes and devices to evade payment limit law.  The Bush Administration issued interim rules at the end of December, and the public comment period on that rulemaking expires April 6.

After that, the new Administration can produce a final rule that eliminates the biggest loopholes in current rules that allow landowners to collect hundreds of thousands and even millions of dollars of year from the taxpayer despite far lower payment limits in law.

We are disappointed by today’s vote and by the three defectors to the cause of reform.  We stand ready to support the White House in its case for commodity reform and nutrition enhancement in Congress.  In the meantime, the President should do what is in his power already – close the loopholes that allow the nation’s largest farms to collect unlimited annual production subsidies – by issuing a final rule with real backbone to target payments to working farmers.