Farm bill prospects dim this year, says ag official

Farm bill prospects dim this year, says ag official

CHAMPAIGN — Prospects look dubious for a new farm bill to be written this year, a former deputy agriculture secretary said.

Chuck Conner, who served under U.S. agriculture secretaries Mike Johanns and Ed Schafer from 2005 to 2009, said political gridlock and a presidential election year make the prospect unlikely.

Plus, "staggering" budget realities — underscored by the failure of the congressional "supercommittee" to come up with a budget compromise — complicate the situation, he said.

Speaking at a Champaign County Chamber of Commerce breakfast on Thursday, Conner said not only are congressional Republicans and Democrats at odds with each other, but there are intra-party squabbles among House and Senate members.

Even agricultural lobbying groups can't seem to agree on a direction.

Various types of producers generally have the same goals in mind, Conner said, "but their methods to get there have never been more different than they are today."

Even when the House Agriculture Committee chairman told them to reach an accord, they were able to accomplish little other than to issue a statement that they were "committed to working together."

But Conner, who for the last three years has been president of the Washington-based National Council of Farmer Cooperatives, said it's possible to foresee some things coming down the road.

For one, it's likely that direct payments to farmers will "drop or go away altogether," he said.

He also predicted the Conservation Reserve Program, which encourages farmers to take land out of production, will be capped. He said he expects roughly one-third of all the program's acreage classified as prime farmland to be returned to production in the next decade.

That has implications for corn and soybean farmers, since increased production suggests lower crop prices if demand doesn't change.

Crop insurance is one program farmers can expect to stick around, Conner said.

"It will be the only farm program going forward in the future," he said. "It makes out well in early versions of the farm bill."

Commodity, conservation and crop insurance programs make up only about 23 percent of the agriculture budget, Conner said.

The other 77 percent goes to nutrition programs, namely food stamps, he said — and that is likely to be preserved.

Conner said 43 million Americans use food stamps, and participation in the program is going up "almost vertically."

Explaining agriculture's place in the $3.6 trillion federal budget, Conner said Social Security, Medicare, Medicaid, defense and debt interest make up $2.5 trillion of the budget.

All other programs, including agriculture, account for the remaining $1.1 trillion.

Conner said the 2011 budget deficit was $1.5 trillion — so cutting that deficit will mean severe cuts to discretionary spending programs.

If Congress fails to reach a deficit-reduction package, agriculture can look for automatic cuts of 7.8 percent to take effect next January, he said.

If a deficit-reduction package is enacted, ag spending will likely be cut by tens of billions of dollars, based on compromise proposals that have surfaced, he said.

Despite budgetary woes, Conner said he sees an "extremely positive" future for U.S. agriculture, because the world has an increasing need for food, and only 11 or 12 nations have the potential to be net producers of food.

Conner, who grew up in Benton County, Ind., started as a legislative assistant to U.S. Sen. Richard Lugar, R-Ind., and later worked as a Senate agriculture committee staffer.

He was president of the Corn Refiners Association from 1997 to 2001 and served on the National Economic Council during President George W. Bush's first term.

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EMT wrote on March 09, 2012 at 8:03 am

Conservation Program?  Why do we take money to PAY farmers NOT to make productive use of land?


 


 

Sid Saltfork wrote on March 09, 2012 at 12:03 pm

Sadly; the recession, and deficit has caught up with the agricultural industry.  I say "sadly" because many family farmers will be affected.  Small business owners have been hit hard over the past four years.  Now, it will include small family farmers also.  I have no sympathy for the large, corporate farms; but I do for the small farmers.  When they are forced to sell out, who will buy their land?  It will be the large, corporate farm industry.