The Free Press, Mankato, MN

May 15, 2013

Farmers, food stamps face cuts

By Alan Bjerga, (c) 2013
Bloomberg News.

---- — WASHINGTON — Lawmakers who last year failed to complete a rewrite of U.S. agricultural policy will restart their effort this week with pressure building for even bigger cuts for farmers and food-stamp recipients.

Federal budget-cutting and criticism that aid has been too lavish during a time of record revenue are driving proposals in the Senate and House agriculture committees to end direct payments to farmers and save $23 billion and $40 billion, respectively, over the next 10 years.

This could set up a struggle to pass a bill that will satisfy farmers, environmentalists and nutrition advocates, said Mark McMinimy, an analyst at Guggenheim Washington Research Group in Washington.

“It’s going to become a lot of nibbling among programs, trying to keep the core programs intact,” he said in an interview.

Both panels are scheduled this week to draft their versions of a new five-year law reauthorizing a half-trillion dollars in U.S. Department of Agriculture programs.

Crop subsidies benefiting buyers such as Archer-Daniels- Midland and food stamps subsidizing purchases at Supervalu are prime targets for lawmakers seeking to trim the deficit.

Last year, a bill passed the Senate that would have resulted in the first major reductions in farm aid since 1996.

The measure fizzled in the House, where leaders wanted deeper cuts to food stamps, the biggest USDA expense. The current law, passed in 2008, was extended in January until Sept. 30, after concerns were raised that a lapse in farm programs would double the price of milk.

Senate Agriculture Chairwoman Debbie Stabenow, D-Mich., said the bill being crafted in her committee creates risk-management tools to protect farmers against market gyrations or weather disasters without subsidies that pay out even in good times.

In March, the Congressional Budget Office said the plans approved by the full Senate and the House Agriculture Committee last year would save less money than originally estimated, which has lawmakers pursuing more savings.

Both committees have said they’ll eliminate a program that pays growers of corn, rice and other major crops regardless of market prices, while using some of the savings to insure farmer revenues in less-profitable years.

Food stamps will also see cuts.

“We all knew that if we didn’t pass a farm bill last year, this was going to happen,” said Mary Kay Thatcher, chief lobbyist for the American Farm Bureau Federation, the biggest U.S. farmer organization, in a telephone interview. Subsidies will need to be balanced “so that no one commodity gets too rich compared to another one,” she said.

To do that, lawmakers on both committees have added payment programs for southern cotton, rice and peanut farmers to compensate for remaining subsidies seen as being more generous to northern-grown crops like corn and soybeans.

Expanding crop insurance is the main goal of nearly every grower group, she said.

That priority is misplaced, said Ken Cook, president of Environmental Working Group, a conservation advocate based in Washington.