Friday, July 16, 2010

Stakes are high in pending farm bill


As Congress begins debate over crafting new farm legislation, chances are good that the 2012 Farm Bill will be negotiated and written during a difficult economic period. As history indicates, that means cuts to some farm programs are likely.

The biggest challenge will be the budget. The budget baseline for many farm bill programs has decreased since the passage of the last farm bill in 2008. More than 30 programs included in the last bill do not have any baseline at all and the standard reinsurance agreement currently being negotiated threatens to rob even more spending baseline.

Most farmers generally support the safety net provided in the 2008 farm bill, but some believe the crop disaster program is inadequate. In some cases, the coverage may be duplicative. Crop disaster assistance is provided to farmers to help protect crops from natural disasters. This and many other farm programs help keep farms solvent during difficult economic periods. While some of these programs need reform, they are vital to maintaining a domestic supply of food, and in turn help maintain our nation's security.

The American Farm Bureau Federation believes that five key principles should be followed during the rewrite process:

· The bill should be fiscally responsible.

· The basic funding structure of the 2008 farm bill should not be altered. In other words, money should not be shifted from one title of the farm bill to another.

· The bill should benefit all agricultural sectors.

·World trade rulings should be considered.

· Consideration should be given to creating a stable business environment, critical to success in agriculture.

An American Farm Bureau Federation spokesman testifying in front of a congressional subcommittee said that today, both crop insurance and the farm bill Commodity Title programs provide the option of support to farmers based on revenue losses and not strictly price or yield risk. Yet, despite this convergence of farm programs and crop insurance, there are still many farmers who fall between the cracks and have little protection from volatile markets and weather. The bottom line is that crop insurance and farm programs have changed significantly over the past 20 years and these changes have left producers with different safety nets.

While many concepts, such as whole-farm revenue options, will undoubtedly be floated during the farm bill rewrite, the Farm Bureau intends to keep an open mind, but will be guided by its five farm bill principles.

Frank Priestley is president of the Idaho Farm Bureau.

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