NSAC's Blog

Farm Bill Prospects

December 2, 2011

With the demise of the Super Committee and its deficit reduction bill that never happened, attention has now turned to crafting a new farm bill as a stand alone measure in 2012.  This week Senate Agriculture Committee Chair Debbie Stabenow (D-MI) said farm bill action will begin again with some hearings in late January or February, noting that the outline of the bill she and House Chair Frank Lucas (R-OK) crafted for the Super Committee would serve as the foundation for a new 2012 Farm Bill.

The draft bill aimed at Super Committee consideration has not been released, nor has an accurate detailed summary of its contents.  It appears that will remain the case.  We summarized some of the key ingredients in the draft bill for our readers last week.

There continues to be speculation about the possibility of attaching a farm bill, either the draft 2011 Stabenow-Lucas measure or a variation on it, to a resuscitated government-wide deficit-reduction measure or as an offset to another spending or tax cut measure, as an alternative to proceeding to a stand alone farm bill under a more regular legislative process.  The verdict for now is to head into the new year looking at a more normal farm bill process as the default setting but at the same time keeping options open as Congress grapples with larger spending, stimulus, tax, and deficit reduction measures.

Some policymakers have suggested starting all over next year from a clean slate.  That seems highly unlikely.  To the extent that sentiment is more than rhetoric, however, it appears to be aimed primarily at the commodity title of the bill, and there is little doubt that it was the most problematic aspect of the bill and will likely remain so.  There may be some hope that a return to more regular order, with the prospect of the amendment process in committee and on the floor, will tamp down some of the wilder elements in the draft commodity title.   For starters, perhaps, interest groups and Members will possibly think twice about provisions that would have distorted planting decisions and increased payment limits, knowing the difficulties they would face defending such propositions on the floor.

Another big area for changes, albeit one that has received little attention, are all the titles that were not at all fleshed out other than simple date-changing re-authorizations in the rush to complete a bill in time for Super Committee consideration.  These include among others the credit, rural development, research, and trade titles.  There are both funding issues and policy issues to be faced in all of these titles.  Though they do not generally receive the same attention as the big money titles (nutrition, crop insurance, commodities, and conservation), there is major policy work to be done that by and large was not attended to in the hurry-up 2011 draft bill.  Even in some of the big money titles there is more work to be done on the policy front than there was time for in 2011.

The new fiscal reality facing the 2012 Farm Bill is the automatic cuts to government spending that will trigger in January 2013 as a result of the Super Committee’s inaction.  There continues to be lots of talk about possible ways sequestration, as the automatic cuts are know, might be un-triggered, either yet this year in some mega-negotiation over the remaining FY 2012 government funding bills and big ticket items like payroll tax cuts, alternative minimum tax rules, and Medicare payments to doctors, or next year as part of a new try at a deficit reduction deal.  As of now, however, the betting line would still favor sequestration hitting in 2013.

If that betting line holds, any farm bill written next year will have to assume sequestration will in fact take effect.  The biggest loser in that scenario is the crop insurance program, the largest of the farm subsidies.  It is also one of the more perplexing items in the farm bill-sequestration interface.  Crop insurance policy changes to meet the sequestration budget cut target will be determined by the Administration and will be formulated at the same time that the Agriculture Committees will be trying to write crop insurance provisions for the new farm bill.  That dual and possibly conflicting process might in turn lead to some intriguing negotiations.

As we discussed in an earlier blog, there are many possible scenarios under which a farm bill gets finished next year and others in which it is not completed until 2013.  It may be months yet before the ultimate path to the new farm bill becomes clear.  Our position will remain to work for a new farm bill that addresses the pressing needs for programs and policies that promote a more sustainable farm and food system and to get that new bill completed on schedule in 2012.

Categories: Budget and Appropriations, Farm Bill

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