As A New Deadline Looms, The Farm Bill Saga Continues, Somehow
As Congress returns to work this month, the docket is chock full of pending legislation, with three major proposals that could affect undocumented immigrants, students, and farmers. Partisan gridlock has prevented any movement on the effort to pass a new farm bill or renew the current one, which is set to expire in September.
Chances for passing a new bill appear bleak following the House’s rejection last month, when elected officials traded jabs on proposed cuts to the Supplemental Nutritional Assistance Program — commonly known as food stamps — used by 50 million low-income Americans to feed their families. Because of the potential impacts to poor families and commercial farming, the ongoing farm bill saga has been labeled a critical juncture in the fate of American agriculture.
Senate Majority Leader Harry Reid (D-Nev.) has made it clear that an extension of the current farm law, passed in 2008, is unlikely, urging the House to pass the Senate version of the bill instead. The ball is now clearly in House Speaker John Boehner’s (R-Ohio) court as he attempts to try to inspire a bipartisan compromise after the 195-234 vote last month. With the Sept. 30 deadline looming, the clock is ticking.
“Doing nothing means no reform, no deficit reduction and no certainty for America’s 16 million farm-industry workers,” said Reid in a recent statement to the Associated Press.
Partisan bickering and Congressional gridlock have become the modus operandi for the legislative branch, which now has an abysmal 16 percent approval rating among U.S. citizens, according to recent opinion polling.
Thus far, lawmakers have only come together when it comes to rejecting proposals. A bipartisan group of lawmakers in the House defeated the $940 billion farm bill proposal last month after Democrats protested cuts of $20.5 billion to food stamps.
The Washington Post reports that most House conservatives also voted “no,” hoping to push for deeper cuts of an additional $2 billion annually from the $80 billion-a-year food stamp program.
The 17-page proposal allows states to toughen work requirements for food stamp recipients and share any savings that might result from what is known as “culling the rolls,” a way to reduce the number of people on food stamps.
According to the Congressional Budget Office, 210,000 children would lose access to free lunch if their parents are removed from the program. Millions more would lose access to nutritional assistance at home.
“Among those who would be harshly affected are the 22 million low-income children — 10 million of whom now live below half of the poverty line — and the 9 million low-income elderly and disabled people who rely on SNAP assistance to try to get enough to eat,” writes Bob Greenstein, president of the Center on Budget and Policy Priorities.
Food stamp usage has grown by about 70 percent since the financial crisis of 2008, costing the government $74.6 billion last year. Making matters worse are Republican hopes of reviving an asset test that dates back to 1985.
The test requires that an individual have $2,000 or less in assets in order to qualify for SNAP. Although many states ignore the asset test, House Republicans have tried to revive the proposal in a move that could disqualify thousands from the program.
Even increasing this number to keep up with the cost of inflation has been rebuffed. Accounting for inflation, $2,000 in assets in 1985 would equal roughly $4,200 in 2013.
Where do the farmers fit in all of this?
One of the principal issues at play remains crop insurance, considered by many to be an important safety net that has improved agriculture and given farmers a way to protect against crop loss in the event of an accident or natural disaster.
The problem remains the cost to taxpayers, who are being called upon to provide an ever-increasing percentage of the premium costs for farmers, including big agricultural operations. The U.S. government covers roughly 62 percent of the premium costs on average, for a total of about $7 billion in 2012. Last year, taxpayers picked up 100 percent of the premium cost, $264 million, to cover almost $7.8 billion in liabilities.
Direct subsidies have become less popular as taxpayers become less willing to directly subsidize Monsanto, Archer Daniels Midland and other multibillion-dollar agriculture corporations. These corporations are still able to receive a boost through extensive lobbying that preserves their crop insurance subsidies.
According to the Center for Responsive Politics, a nonpartisan watchdog group that tracks lobbying, “political activity by some of the 17 officially authorized insurance agencies has ramped up in recent years.”
Leading the pack is the Great American Insurance, a subsidiary of American Financial Group that gave nearly $2 million in the 2012 election cycle directly to candidates and to lobbying.
According to OpenSecrets.org, Great American Insurance gave $120,000, or 93 percent of the total, directly to Republican candidates – up from $23,000 in 2010.
As Republicans and Democrats spar over SNAP cuts, both the House and Senate versions of the farm bill call for increased funding for the crop insurance program, paid for with a $5 billion reduction in direct payments to farmers.
“Direct payments have created more embarrassment for farm lobby groups over the past decade,” said Chris Edwards, director of tax policy studies at the Cato Institute. “That’s why there’s been a shift toward crop insurance.”
What does this all mean for the farm bill? Republicans in Congress are likely to ask the poor to tighten their belts while preserving insurance subsidies for big ag. Most of the 50 million SNAP recipients would receive less and 2 million would lose benefits altogether if the $20 billion cuts are adopted. The White House appears to be complicit in this dance.
“The White House has been surprisingly unhelpful in generating reliable data to guide Congress. But President Barack Obama’s 2014 budget estimates that $4.2 billion could be saved over 10 years by asking all farmers to pay 3 percentage points more on any premium that is now subsidized at a rate of more than 50 percent,” Politico reports.
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