Farm bill fail: Is food policy headed back to the future?
It’s no secret that the Tea Party wing of the Republican Party would like nothing more than to send Americans back in time. Given their recent attempts at banning contraception, we might think that digging up a DeLorean or getting Mr. Peabody to dust off his Way Back Machine were perhaps their best shots at it. But it now appears that the House GOP may have discovered an easier way — the 2012 Farm Bill.
Where are we going? Back to the great year of 1949. Ah, 1949. The Yanks beat the Brooklyn Dodgers in the World Series (on their way to five straight World Series victories) while Hedy Lamarr ruled the box office in the thrilling epic Samson & Delilah. It was also the year William Faulkner won the Nobel Prize for Literature. As for America, its population, at just under 150 million, was less than half of what it is today. The Interstate Highway System didn’t even exist yet.
In 1949, approximately 15 percent of Americans lived on farms and almost 10 percent still worked in agriculture overseen by 5 million farmers (compared to less than a million today).
It was also the year Congress passed the Agricultural Act of 1949, the only piece of “permanent legislation” when it comes to farm subsides. You see, the farm bill gets adjusted and reauthorized every five years, but virtually all the programs and subsidies within it expire at the end of each five-year period. The provisions of the 1949 act never do.
And so, should Congress pass neither a new farm bill nor an extension of the “current” one by the end of September, then all the subsidies and programs that exist, from crop insurance, to direct payments to conservation programs, would disappear. The entire agricultural support system would revert to a version constructed for a very different America — a system that may not even be workable in today’s far more complex economy.
This, by the way, has always been considered an inconceivable event. The last three farm bills — 1996, 2002, 2007 — were delayed for various reasons but Congress always managed to pass one-year extensions of the previous bills with no real debate.
However, the House GOP’s inability to pass a federal transportation bill — the bill that sends billions in dollars to states to build and maintain roads, bridges, and public transit, and is so larded with goodies that it’s usually one of easiest laws to pass — suggests that the legislative rules of engagement may have changed.
The concern with the farm bill, as explained to me by Ferd Hoefner, the policy director of the National Sustainable Agriculture Coalition (NSAC), is that GOP House members may balk at passing an extension if they’re convinced this year’s version isn’t sufficiently draconian. As Hoefner put it, they could say, “let’s have a showdown.” No big cuts equals no extension.
Making matters much worse, was last week’s release of the House GOP budget plan. Not content with the proposed $23 billion in farm subsidy cuts, GOP members want to cut $34 billion over the next 10 years. In addition, the House budget would cap crop insurance payments — not necessarily a bad idea since there is currently no maximum payout farmers can receive — a total non-starter with farm state representatives.
But the House budget saves its most significant “reform” for the Supplemental Nutrition Assistance Program (SNAP, aka food stamps). Should the House GOP get its way, food stamps would be converted to a block grant program and have its spending capped — thereby saving $123 billion over the next decade. What that means in practice is that states could run out of money to help the hungry if they go over an annual limit. (Food stamps currently rise to meet the need based on a set of eligibility rules.) Should states spend the money too quickly in a given year due to an increase in food insecurity, food stamp funding would dry up. After that, too bad! Let them eat cake! It’s a perfect companion to the House GOP’s massive tax cuts for the wealthy.
It will also never happen. The budget is more of a political document than a legislative blueprint. However, there are dozens of Tea Party representatives who will treat this proposal as Gospel as they seek to cut whatever aspect of the welfare state they can.
Meanwhile, Hoefner explained recently in a blog post on the NSAC website that the House GOP threw another wrench into the Farm Bill legislative process. It wants to pass a “spending cuts only” version of the farm bill by April 27. Besides being a difficult task based on timing along, it’s also in direct conflict with the “normal” Farm Bill process that’s currently underway. After all, the Senate is hard at work on a full Farm Bill – and has no intention of passing a cuts-only version. The House GOP’s maneuver thus threatens to derail the Farm Bill entirely. Hoefner says:
With two very different processes in the two chambers, it is anyone’s guess as to how this whole thing plays out. It is like two trains heading down two different parallel, non-intersecting tracks. Whether a train can jump the tracks and actually get us to a 2012 Farm Bill will take a great deal of legislative ingenuity.
Suddenly, it looks like an extension is the only option. But given the extreme positions the House GOP is taking on farm policy and their willingness to ignore typical congressional procedure, it’s entirely conceivable that they will refuse an extension outright. Why would they extend a Farm Bill they believe to be a deficit-fueling giveaway to the undeserving poor and overcompensated farmers?
And if they do refuse, that would leave us, come October when the Farm Bill officially expires, with 1949’s farm policy.
What would that look like? Well, the 1949 law was built almost entirely around loans to farmers, with loan amounts based on a percentage of past prices for a particular commodity. But the fact is, no one’s quite sure how it would work. According to Hoefner, the USDA has several experts at the agency trying to figure out what a “snapback” to the 1949 law would mean.
And that’s because the farm support system has since replaced loans with subsidies. These days it’s all about government payments and Hoefner’s understanding is that any attempt to reinstate the loan-based system would result in a system that could be as generous to commodity farmers as the current one. However, Hoefner speculates that restoring the old system would be very difficult, if not impossible, to accomplish.
It’s not all bad news, though! I noticed a provision in an amendment to the 1949 law that established farmer-owned reserves for wheat. Some advocates, like the National Farmers Union, believe such programs — basically a stockpile of a particular commodity crop that the farmer deposits to or draws down based on market prices — should be the basis for US farm policy going forward.
In theory, it would be a great way to protect farmers from price volatility while reducing the cost to taxpayers since farmers would be increasing or decreasing the market supply of a commodity, thereby affecting the price. Since the farmer would keep the profit from these transactions, there would be less need for government payments. The particular program in the 1949 bill was phased out when market-based reforms began to dominate farm policy starting in the mid-nineties. But it will come roaring back if the House GOP decides to pull the trigger on its farm bill hostage.
Will any of this come to pass? Not in a sane world. But as of right now, I’m not prepared to bet against the crazy when it comes to congressional Republicans.