Timeline Emerges for Consideration of 2012 Farm Bill
The announcement by Senate Agriculture Committee Chairman Debbie Stabenow (D-MI) that the final two farm bill hearings on the committee’s docket will now be held March 7th and March 14th is another sign that the Ms. Stabenow is hoping to move a bill out of committee prior the Easter recess slated to begin April 2nd. When coupled with the announcement by House Agriculture Committee Chairman Frank Lucas (R-OK) that his committee will begin farm bill hearings in March, it is becoming clear that movement is occurring in both chambers in an effort to move a bill to the Senate and House floors for debate in May or June.
Originally scheduled for March 14th and March 21st, the final two hearings will cover Healthy Food Initiative, Local Production and Nutrition, as well as Risk Management and Commodities. It is the latter hearing that has garnered the attention of the agriculture sector. A one week shift forward might not seem significant but every day counts for commodity groups who have been unable to reach agreement as to what the farm bill safety-net should look like.
Last November, in an effort to retain control of agriculture’s policy destiny the leadership of the Senate and House Agriculture committees pledged to submit to the Joint Select Committee on Deficit Reduction (aka the “Super Committee”) a package of at least $23 billion in savings over ten years. Although it is likely that the draft farm bill prepared last November will be used as a starting point, the budgetary challenges have only become more difficult.
Whereas nutrition spending essentially appears to be off the table (at least at this stage of the game), there is likely to be calls from members of the House for enhanced spending reductions in commodity title expenditures. In addition, will the House Budget Committee repeat its call from last year for approximately $33 billion in farm bill spending reductions or will they advocate for a different number?
Although the vast majority of policymakers and veteran farm bill observers expect crop insurance to be the centerpiece of next farm bill safety net, the devil remains in the details. According to a Congressional Research Service (CRS) memo released earlier this month, numerous proposals have been offered to revise the “farm safety net” for producers of crops covered by farm commodity support programs – including programs designed to support farm income and manage risk.
Proposals have ranged from a simple extension of current farm programs at reduced funding levels to program consolidation and wholesale replacement. There have, however, been common threads throughout nearly all of the proposals related to the Commodity Title (Title I), including; how price or revenue protection is established, the geographic level at which program benefits are triggered and whether the proposal addresses “shallow losses” – losses not covered by the crop insurance program but, instead, absorbed by the producer via the policy deductible.
Other outstanding issues include whether program benefits should be “re-coupled” (based on current plantings) instead of tied to historical plantings (as is currently the case) and to what extent a revised safety net is applicable to crops outside of traditional program crops.
In addition to the policy, political and budgetary challenges facing the 2012 farm bill there is also the challenge of timing. Not only will the legislation have to compete with election year politics, it will also have to compete for floor time in the Senate and House of Representatives as leadership in both chambers strive to effectively manage the congressional calendar amongst competing legislative priorities.
Commentary: Renewable Energy
The long-term solution to our energy needs is found in the free market and that government should not favor one form of energy over another. Instead, the Federal government’s role in developing a domestic renewable energy industry should be limited to providing tax incentives to encourage innovation, exploration and production of all forms of energy.
Ongoing development of renewable fuels continues to be a core issue for the agriculture sector. Within the realm of public policy timely, targeted, and temporary incentives are worthy of consideration so that new renewable energy feedstock can be developed, commercialized and allowed to compete on a level playing field with established energy sources.
Virtually every source of energy – from coal to hydroelectric, nuclear to wind, solar and geothermal energy – has been subsidized in its early years. Taxpayer investments in energy sources that drive our economy help our Nation remain competitive but incentives should help emerging industries to develop and grow, not to be forever subsidized by the Nation’s taxpayers.
Now more than ever, our grain and livestock producers are interconnected as they strive to meet the food, fiber and fuel needs of a growing world population. As such, it is critically important that the legitimate concerns of livestock producers be taken into account so that the benefits derived from one sector do not result in adverse effects for another. When both sides strive to seek common ground prospects for success in the policy and political arenas are greatly enhanced.
When considering the role renewable energy plays in national security, policy makers must continue to work for fiscal responsibility while engaging the agriculture sector in balancing forward-looking policies that balance our need for deficit reduction and the development of renewable energy.
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