Farm Bureau, Farmers Union await CBO budget score
March 07, 2011 | 12:06 PM
TAMPA, Fla. — Farm groups won’t really be able to figure out their priorities for the 2012 farm bill until the Congressional Budget Office releases its 10-year forward-looking budget score in March 2012, key lobbyists for the American Farm Bureau Federation and the National Farmers Union agree.
Mary Kay Thatcher, a lobbyist for the Republican-leaning Farm Bureau, and Chandler Goule, a lobbyist for the Democratic-leaning Farmers Union, both said at a Commodity Classic session here Saturday that they expect agriculture to be under pressure to take a budget cut, also noting there are 37 or 38 programs that have no budget baseline after 2012.
Thatcher said farmers’ priorities would depend on whether the cut would be 2 percent or 15 percent. Goule said he is hearing “the exact same thing,” that no one will know what the farm bill will look like until the CBO score is known.
Although Farmers Union's ideology holds that a government safety net for agriculture is vital, Goule pointed out that NFU’s policy says the deficit needs to be reduced. Thatcher noted that while Farm Bureau members say something has to be done, 41 percent of the American people believe the budget can be balanced without cutting any program that affects them.
On nutrition programs, which account for about 70 percent of the Agriculture Department budget, Thatcher said the recent Government Accountability Office report raising questions about the efficiency of smaller feeding programs might lead to cuts in those programs. Thatcher said she believes anti-hunger advocates will push for even more funding for nutrition programs, but that “people get outraged” at that idea because so many children are already getting free school lunches and breakfasts.
The proposed cuts in the special nutrition program for women, infants and children known as WIC is “easy pickings,” she said, because that money has not been spent. But Goule noted that while the House Agriculture Committee might cut nutrition programs, it is not easy to sustain those cuts on the House floor because most members of the House come from urban areas.
Farm Bureau has supported the direct payments that crop farmers get whether prices are high or low, and NFU has opposed it. Thatcher said the direct payments have come under so much criticism there may be proposals to pay farmers the money only “when times are tough.” Iowa Farm Bureau has proposed using direct payment money for other purposes, but Thatcher said Farm Bureau does not see much interest at the national level in cutting direct payments. Anyone who proposes cutting direct payments in the South could get “skinned alive,” she said.
Thatcher also said she believes farmers have some “flawed ideas” about what could be done with the $5 billion in direct payments if the money were to used for other purposes. Some farmers want crop insurance premiums subsidized at the 90 to 95 percent level, but that would cost much more than $5 billion, she contended. Others believe that ending the direct payments program would end criticism of farm programs, but the Environmental Working Group and other critics are likely to shift their criticism to crop insurance subsidies, she said.
Goule pointed out that NFU has never been enthusiastic about direct payments because the group believes that the purpose of farm programs “is not to keep [farmers] in the black and put money in the bank, but to keep them from going out of business in hard times.”
Goule said he could foresee a consolidation of the average crop revenue election program known as ACRE and the permanent disaster program called SURE. Ad hoc disaster payments have proven more expensive than the SURE program, he said. There have been proposals to improve the ACRE program by making it based on county rather than state level revenue losses, Thatcher said, but that would require cutting other programs to pay for it.
Crop insurance has always been handled in a separate bill, but is likely to be a key component of the 2012 farm bill because it has become such a large budget item, Thatcher said. The Obama administration’s renegotiation of the standard reinsurance agreement cut $6 billion from the budget for the companies and agents to deliver the programs, but 69 percent of the cost of the program is producer premium subsidies, which will put those subsidies under pressure, she noted.
On trade, Goule noted that although NFU is a “fair trade” rather than free trade organization, it may support the Korea-U.S. trade agreement if its members believe it improves the market for U.S. beef. Thatcher said she believes President Obama will send the Korea-U.S. agreement to Capitol Hill, but that she would be “amazed” if he sends the agreement with Colombia to the Hill, because unions oppose it.
The U.S. percentage of the Colombian wheat, corn and soybean market has declined from 71 to 27 percent in the last five years as competitors have gained more market access, Thatcher said. But Goule said the continued killing of union workers in Colombia is still a problem for support for that agreement.
Thatcher said she believes that Obama will nominate Michael Scuse, the acting undersecretary for farm and foreign agricultural services, for that position. Scuse, who is a former deputy undersecretary, has succeeded Jim Miller, who returned to Capitol Hill to work for Senate Budget Committee Chairman Kent Conrad, D-N.D., on the 2012 farm bill. The position requires Senate confirmation.
Mary Kay Thatcher, a lobbyist for the Republican-leaning Farm Bureau, and Chandler Goule, a lobbyist for the Democratic-leaning Farmers Union, both said at a Commodity Classic session here Saturday that they expect agriculture to be under pressure to take a budget cut, also noting there are 37 or 38 programs that have no budget baseline after 2012.
Thatcher said farmers’ priorities would depend on whether the cut would be 2 percent or 15 percent. Goule said he is hearing “the exact same thing,” that no one will know what the farm bill will look like until the CBO score is known.
Although Farmers Union's ideology holds that a government safety net for agriculture is vital, Goule pointed out that NFU’s policy says the deficit needs to be reduced. Thatcher noted that while Farm Bureau members say something has to be done, 41 percent of the American people believe the budget can be balanced without cutting any program that affects them.
On nutrition programs, which account for about 70 percent of the Agriculture Department budget, Thatcher said the recent Government Accountability Office report raising questions about the efficiency of smaller feeding programs might lead to cuts in those programs. Thatcher said she believes anti-hunger advocates will push for even more funding for nutrition programs, but that “people get outraged” at that idea because so many children are already getting free school lunches and breakfasts.
The proposed cuts in the special nutrition program for women, infants and children known as WIC is “easy pickings,” she said, because that money has not been spent. But Goule noted that while the House Agriculture Committee might cut nutrition programs, it is not easy to sustain those cuts on the House floor because most members of the House come from urban areas.
Farm Bureau has supported the direct payments that crop farmers get whether prices are high or low, and NFU has opposed it. Thatcher said the direct payments have come under so much criticism there may be proposals to pay farmers the money only “when times are tough.” Iowa Farm Bureau has proposed using direct payment money for other purposes, but Thatcher said Farm Bureau does not see much interest at the national level in cutting direct payments. Anyone who proposes cutting direct payments in the South could get “skinned alive,” she said.
Thatcher also said she believes farmers have some “flawed ideas” about what could be done with the $5 billion in direct payments if the money were to used for other purposes. Some farmers want crop insurance premiums subsidized at the 90 to 95 percent level, but that would cost much more than $5 billion, she contended. Others believe that ending the direct payments program would end criticism of farm programs, but the Environmental Working Group and other critics are likely to shift their criticism to crop insurance subsidies, she said.
Goule pointed out that NFU has never been enthusiastic about direct payments because the group believes that the purpose of farm programs “is not to keep [farmers] in the black and put money in the bank, but to keep them from going out of business in hard times.”
Goule said he could foresee a consolidation of the average crop revenue election program known as ACRE and the permanent disaster program called SURE. Ad hoc disaster payments have proven more expensive than the SURE program, he said. There have been proposals to improve the ACRE program by making it based on county rather than state level revenue losses, Thatcher said, but that would require cutting other programs to pay for it.
Crop insurance has always been handled in a separate bill, but is likely to be a key component of the 2012 farm bill because it has become such a large budget item, Thatcher said. The Obama administration’s renegotiation of the standard reinsurance agreement cut $6 billion from the budget for the companies and agents to deliver the programs, but 69 percent of the cost of the program is producer premium subsidies, which will put those subsidies under pressure, she noted.
On trade, Goule noted that although NFU is a “fair trade” rather than free trade organization, it may support the Korea-U.S. trade agreement if its members believe it improves the market for U.S. beef. Thatcher said she believes President Obama will send the Korea-U.S. agreement to Capitol Hill, but that she would be “amazed” if he sends the agreement with Colombia to the Hill, because unions oppose it.
The U.S. percentage of the Colombian wheat, corn and soybean market has declined from 71 to 27 percent in the last five years as competitors have gained more market access, Thatcher said. But Goule said the continued killing of union workers in Colombia is still a problem for support for that agreement.
Thatcher said she believes that Obama will nominate Michael Scuse, the acting undersecretary for farm and foreign agricultural services, for that position. Scuse, who is a former deputy undersecretary, has succeeded Jim Miller, who returned to Capitol Hill to work for Senate Budget Committee Chairman Kent Conrad, D-N.D., on the 2012 farm bill. The position requires Senate confirmation.
