Congress agrees on farm bill, but president will veto

SALEM, Ohio — U.S. Sen. Tom Harkin referred to the biblical story of Job during a May 8 teleconference announcing the finalization of the new $300 billion farm bill.

Job had a lot of afflictions, Harkin explained, but through it all, he persevered.

“Right now, I don’t think he’s got nothin’ on me,” Harkin said. “It’s been a bumpy ride, but we’ve all kept the faith.”

Harkin and his House counterparts may need more of Job’s patience to get the bill signed into law, because shortly after the announcement on the Hill, U.S. Secretary of Agriculture Ed Schafer declared the president will veto the bill.

Schafer said the legislation “lacks meaningful farm program reform and expands the size and scope of government.”

“I have visited face to face with our president and he was direct and plain,” Schafer added. “The president will veto this bill.”

Ready for fight

When the bill heads to the floor this week (the bill was scheduled to reach both House and Senate floors on Wednesday, May 14), Harkin expects at least 79 votes in the Senate, more than any previous farm bill received.

“Like any compromise bill resulting from hard bargaining among regional and other interests, this farm bill is far from perfect,” Harkin said. “But no piece of legislation is.

“It includes significant reforms, as well as these major advances. It deserves the President’s signature.”

Rep. Bob Goodlatte, R-Va., the ranking minority member of the House Agriculture Committee, said House votes on previous farm bills had more than the necessary two-thirds margin to override a White House veto.

Opposite camps

Congress thinks there is reform in the farm bill and the House and Senate leadership presented a united front to say so during last week’s news conference.

Kent Conrad, D-N.D., was a key player in the conference committee negotiations. A member of the Senate ag committee, Conrad also chairs the Senate Budget Committee and serves on the Senate Finance Committee.

He called the legislation the “most reform-minded bill” since the 1949 farm bill. He, like others, pointed to the payment limitation changes as proof. Nonfarmers will be limited to $500,000 in income, to be eligible for payments; farmers are limited to $750,000 in income, after which they will receive no direct payments.

The bill defines who are farmers and nonfarmers.

However, explained House ag committee chairman Collin Peterson, the income limitation does not include conservation payments. The nonfarm payment limit for conservation payments is $1 million; if two-thirds of an individual’s income is from farming, there is no limit for conservation payments.

The payment limitations are projected to save $620 million over 10 years.

The payment limitation was “real reform,” said Republican Saxby Chambliss, ranking minority member of the Senate ag committee. “We moved as far as we could to the administration’s request.”

Sec. Schafer said the bill qualifies “more people for taxpayer support.”

ACRE program

The state-level revenue protection program will start next year. In it, a farmer will agree to give up 20 percent of direct payments and take a 30 percent cut in loan rates in exchange for a countercyclicdal support price.

The state revenue guarantee on acres planted will be equal to 90 percent of the product of a state average yield factor times the national season average price for the previous two years for the commodity.

A ‘food bill’

Both Peterson and Harkin called the legislation a “food bill” not a “farm bill. In fact, the official name of the bill is “The Food, Conservation and Energy Act of 2008.”

In this year’s bill, Peterson emphasized, 73.5 percent goes into food and nutrition programs — food stamps, food banks, school nutrition programs, for example — up from 66 percent in the last farm bill. Of the $300 billion in the farm bill, only between $36 billion and $40 billion goes to farm programs.

Both the House and Senate ag leaders got fired up at the suggestion that biofuels, specifically ethanol, are triggering the global rise in food costs.

“We know that ain’t so,” Harkin said, rattling off a list of other factors: lower production in Southeast Asia; higher income and demand for protein in China and India; the cheaper dollar and the “giant sucking sound taking our grain away”; increased input and energy prices; and higher harvesting, processing, shipping, packaging and energy costs.

“Ethanol is nothing, compared to all that,” Harkin said.

“What they’re saying, it just isn’t so!”

Peterson said an unsuspecting public is getting “bogus and false information,” and a lot of money is being spent to “gin this up.”

“One of the big problems is we sold food below the cost of production for 20 years, and now we have a big shock,” Peterson said. “If food had followed the cost of production, we wouldn’t have this big spike now.”

End of the road

Since January 2008, House and Senate conferees have been working to come to an agreement on the differences between the farm bills passed by each chamber. Budgetary problems plagued the conference process for months and only when resolved could members address policy issues.

Some kind of action is needed by May 16, when the current two-week extension expires.

(What’s your take on the new farm bill? Share your opinion on Farm and Dairy’s “Current Issues” message board.)

(Provisions of the farm bill are listed below.)

The Food, Conservation, and Energy Act of 2008

Food Security

– Nutrition programs increased by $10.361 billion with appropriate benefit increases that are indexed to the cost of living.

– Assistance to food banks increased by $1.25 billion.

– New funding boosts organic agriculture, fruit and vegetable programs, and local food networks.

– Country-of-origin labeling for meat and produce made mandatory

Renewable Energy

– Provides $1.1 billion to fund programs in renewable energy technology investments in sources beyond feed grains.

– Corn ethanol tax credit reduced and redirected to incentives for cellulosic ethanol.

– Creates a loan guarantee program and a program to encourage and develop production of dedicated energy crops.

– Bioenergy research increased and renewable energy programs expanded.

Reforming Farm Programs

– Farm program safety net modernized, with an updated adjusted gross income means test for commodity programs.

– Farm and conservation program transparency increased, with direct attribution of payments and the ending of practices that result in multiple payment eligibility.

– Crop insurance reformed to prevent windfall reimbursements to crop insurance companies.

– Budgeted standing disaster assistance program for crops stricken by catastrophic natural disasters such as drought and flood.

Environment

– Conservation program spending increased by $7.9 billion.

– Doubles funding for the Farm Protection Program.

– Increases funding for the Environmental Quality Incentives Program and Conservation Stewardship Program.

– Continues funding for Grassland Reserve and Wetlands Reserve programs.

– Creates an Open Fields Program to encourage public access to private land for hunting and fishing as well as a Chesapeake Bay program to help restore and protect the Bay watershed.

International Food Aid

– Provides $60 million to purchase food overseas to feed people in need on top of the existing Food for Peace international aid program, along with an evaluation of this change and its effect on U.S. response times.

– Reauthorizes the McGovern-Dole International Food for Education and Child Nutrition Program for infant, child, and school nutrition programs in underdeveloped countries and provides an infusion of $84 million in additional funding

Source: House Agriculture Committee (Updated May 12, 2008)

About the Author

Farm and Dairy Editor Susan Crowell has been with the paper since 1985, serving as its editor since 1989. Raised on a farm in Holmes County, she is a graduate of Kent State University.You can follow her on Twitter at http://twitter.com/scrowell and follow Farm and Dairy at http://twitter.com/farmanddairy. You can also find her on Google+ and Facebook. More Stories by Susan Crowell

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