Tuesday, September 25, 2007

Getting Back to the Farm Bill...

Finally! I admit the August recess (and yes, I'm aware it's September 25) caused me to take my eye off this ball. It's time for a whirlwind reorientation:

First of all, timing. A lot of other things have been on the Senate’s plate this month, including the post-surge Iraq assessment. Poor Tom Harkin and his farm bill have been put off, again. Since the 2002 farm bill expires on September 30, a 30-day extension will be sought (for the time being, though further short-term extensions are certainly possible). Harkin still says he intends for the Agriculture Committee to take up the farm bill in the first week of October, before the Columbus day break. It’s unclear to me how likely that actually is.

Another thing that’s unclear is whether a major personnel shift will cause delays or change dynamics. Mike Johanns stepped down last week as Secretary of Agriculture in order to run for Sen. Chuck Hagel’s seat in Nebraska, and will be replaced by deputy secretary Chuck Conner. Some feel the timing of Johanns’ move is unprofessional:

‘‘For the secretary to walk away in the middle of a farm bill borders on irresponsible,’’ said Sen. Kent Conrad, a North Dakota Democrat on the Senate Agriculture Committee. His remarks were echoed by Democratic Sens. Byron Dorgan of North Dakota, Tim Johnson of South Dakota and Ben Nelson of Nebraska.”

However, Tom Harkin complimented Johanns’ past work, and Rep. Collin Peterson (D-MN), the House Agriculture Committee chairman so influential in the House version of the farm bill passed in July, expressed doubt that the replacement would matter much.

‘‘Chuck Conner has been running the show behind the scenes on the USDA’s farm bill agenda, so not much will change now that he’s been named acting secretary,’’ Peterson said.

I kind of hate the idea of the acting secretary of agriculture being a past president of the Corn Refiners Association (member companies: Archer Daniels Midland! Cargill! National Starch and Chemical Company! and more!), but there’s no reason I should be surprised. Read their most recent annual corn publication, Corn - Part of a Sustainable Environment. …Seriously, browse the site. It’ll make you as queasy as a Big Gulp full of high-fructose corn syrup.

This is what’s “running the show behind the scenes.”

Another key behind-the-scenes drama is unfolding over funding. Of course, the limited funding available for food and farm programs constrains what is possible: we can’t have farm subsidies at current levels, and strengthen food stamp benefits, and fund every desirable conservation program, and invest in community food programs, and create new departments at the USDA, and provide insurance and disaster relief for farmers, and so on. Well, we can’t unless we, for instance, get out of Iraq; that might free up some funds. But, for the time being, we can’t do everything we want to do.

So Sen. Max Baucus (D-MT—that would be my guy), who’s on the Agriculture Committee but is also chair of the Finance Committee, has pledged to find an additional $10 billion or so in funding for farm bill programs. The hitch is, this situation gives Baucus a tremendous amount of power to determine how that extra money is spent. While Harkin is looking to locate funding for existing conservation programs snubbed by the House bill, Sen. Debbie Stabenow (D-MI) is pushing for the discretionary funds allocated to Community Food Projects to be made mandatory, and anti-poverty advocates still hunger for a stronger Nutrition Title… Baucus has different priorities. Along with Sen. Kent Conrad (D-ND) and Sen. Chuck Grassley (R-IA, and incidentally ranking Republican member of the Finance Committee), Baucus would like to spend at least half that extra money for a permanent USDA-run disaster relief program to protect farmers against losses from drought, floods, and storms.

An excellent article on Harkin’s, Conrad’s, and Baucus’ role in these proceedings, by Steve Kopperud of Brownfield, is here.

Enter emerging co-star Sen. Max Baucus (D, MT), chair of the Senate Finance Committee, who plays the role of the money man in this drama. As when House Ways & Means Committee Chair Charlie Rangel (D, NY) had to conjure up over $4 billion to pay for Speaker Pelosi's desire to expand the food stamp program, all Senators with Farm Bill plans and programs are seeking an audience with Baucus, many on bended knee, in hopes of an offset to pay for their programs.

Baucus is playing it shrewdly, however, and unlike Rangel, he's already said he won't go for tax increases, which means the House scheme to tax the U.S. subsidiaries of foreign-owned companies is pretty much dead. However, he's putting conditions on his largesse. He's known to be putting together an offset package for Farm Bill spending that reports say will "add billions to farm spending." But he'll likely dictate where that money will go and he's a big supporter of the really big permanent disaster program. This does not bode well for Harkin's effort to get an extra $6 billion for conservation, nutrition and specialty crop programs.

Also see this Sept. 6 article from Congressional Quarterly.

Now, besides the obvious problem of trade-offs, a disaster relief program is a good thing in and of itself, right? Who could oppose funds to aid those betrayed by the vagaries of weather? Apparently, however, the question is more complicated than that. The Des Moines Register notes that “Harkin has resisted establishing a disaster program. Critics of disaster aid argue that it encourages farmers to grow crops such as corn in marginal areas.” In fact, the GAO has just issued a report (.pdf summary here) concluding “that crop insurance, in particular, is motivating conversion by greatly limiting the risk of producing crops in areas that are marginal as cropland.” So, for example, a conservation program that compensated farmers for leaving marginal land as wildlife habitat would, in a sense, contradict on principle a program compensating farmers who elected to farm that marginal land and suffered financial loss as a consequence. It is difficult to consider these simply two complementary approaches.

But, from the same Des Moines Register article:

Grassley said earlier Tuesday that he would side with Baucus and favor funding the disaster program[…] Harkin is ‘going to have to make the choice: either less money, or do it the way we want it done,’ Grassley said.

Lovely; here’s hoping Iowa’s two senators are the best of friends.

Whatever happens, funding-wise, we can suspect that the Senate will not be following the House’s lead in trying to pay for stuff by closing corporate tax loopholes or any of that funny business. Sen. Saxby Chambliss (R-GA), ranking Republican member of the Agriculture Committee, drafted a letter with five other senators warning against such erratic behavior. The Senate Agriculture Committee’s press release quotes the letter:

‘Since the Senate Finance Committee is the likely source of additional revenue, we wish to express our concern that any provisions to offset spending be carefully vetted and discussed with all members of the Agriculture Committee prior to markup…We wish to avoid a situation such as that occurred in the House which brought forth an unfortunate series of events, straining the farm bill’s long tradition of bipartisan and multi-regional support.'


A few other specific farm bill issues you might be following:

From Agriculture Online, Grassley expresses confidence that lower caps for farm payments, a source of controversy in the House bill, will fare better in the Senate.

An editorial from AgriNews champions Tom Harkin’s Livestock Title (often referred to as the “Competition Title,” because it is a series of reforms designed to break the economic stranglehold of a handful of corporate meat companies over family farmers and ranchers). These reforms include defending farmers against mandatory arbitration contract provisions; passing the Captive Supply Reform Act S. 1017, which would “restore fair market competition for livestock contracts by requiring marketing contracts to have a fixed base price negotiated in an open public market”; and banning meatpacker ownership of livestock, as trends toward corporate-owned, vertically-integrated enterprises are pushing small producers right out of the industry.

I’m not usually someone with much to say on energy, but it sounds as though there may be some unexpected energy-related developments in the Senate farm bill, again due to Max Baucus’ influence. The Community Food Security Coalition cites CongressDaily of Sept. 18 (the latter is subscription-only) as reporting:

Sen. Baucus is reportedly planning on shifting some renewable energy and fuels production tax incentives from the Energy Bill to the Farm Bill. Sen. Baucus said that the agriculture tax package would include provisions to help farmers and ranchers by including tax incentives for the production of wind and other means of alternative energy. Also, Sen. Baucus announced that there would be tax incentives to encourage farmers to grow crops that are used to make ethanol, biodiesel, and other biofuels. Both the oil and renewable energy industries said that they are in the dark about whether the tax incentives affecting them would be in the Energy or Farm Bill and what exactly the incentives will look like.

Stay tuned, I guess.


h/ts due, as usual, to some other blogs for pre-digestion of sources: in particular, More Deliberate Every Day, and the indispensably amazing digests by Keith Good at FarmPolicy.com.

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