The Hagstrom Report

Agriculture News As It Happens

Conrad proposal could mean quick farm bill rewrite


Senate Budget Committee chairman Kent Conrad, D-N.D., said today he is hoping the Senate Agriculture Committee supports his proposal to combine the countercyclical program, the average crop revenue election program known as ACRE, and the disaster aid programs into a new farm bill when it makes recommendations to the super committee in charge of deficit reduction.

Conrad also advocates renewing the disaster aid programs and making them retroactive to Oct. 1, the date after the current programs expire.

If Conrad’s plan were to move forward, it would mean that the next farm bill — or at least a substantial portion of it — would be written in the next three months during the deficit reduction process.

In an interview with The Hagstrom Report today, Conrad said that while the agriculture economy is strong, the agriculture budget is “going to have to provide savings.” But he added that agriculture’s contribution should be “savings that are attached to policy that makes sense so you have an entire package that can hold together that can be implemented.”

Agriculture Secretary Tom Vilsack also said today that the disaster aid programs that expire on Sept. 30 should be extended without a gap, and Conrad said he agreed. Vilsack told reporters that he did not understand how he could tell farmers that if they had a disaster before Oct. 1 that they would get benefits, but that after Oct. 1 there would be no aid.

The disaster aid programs included in the 2008 farm bill cover crops, livestock, forage, trees, honeybees and farm-raised fish, but all the programs expire on Sept. 30 because Congress could not find enough money to extend for the full life of the farm bill, which expires on Sept. 30, 2012.

“The secretary is entirely correct,” Conrad said. “He has provided good leadership there. I hope colleagues will listen.”

Conrad praised President Barack Obama for including disaster aid in the jobs and deficit reduction package that the White House released Monday, but said he believed it would be better to incorporate the proposal on which he has been working for several months.

Combining several programs “will save money, be simpler to administer, and pay significant economic dividends for taxpayers,” Conrad added.

Conrad has not released his proposal, but said he is now “vetting” it with both colleagues and farm leaders and getting “a positive reaction.” He said he does not have an “official” score for the proposal.

While he approves of Obama’s overall jobs and deficit approach, Conrad said he believes the administration’s proposal to cut $33 billion in farm programs “goes too far.”

Conrad, a member of the Gang of Six senators who were trying to come up with a deficit reduction package earlier this year, noted that group recommended only a $10 billion to $11 billion cut, a third of what Obama has proposed. If the automatic cuts under sequestration go forward, Conrad said, the agriculture cut would be $14 billion to $15 billion.

“I would not have complained if the proposal was for $14 or $15 billion, but $33 billion is just too much,” Conrad said.

“I know something about our writing a farm bill,” Conrad continued. “I know something about our competitive position in the world. The Europeans are spending about four times as much.”

In a statement, Conrad also said that such a large cut “could undermine our ability to develop an effective farm bill.”

He said cuts in the farm budget should come from the direct payments program, which currently pays crop farmers about $4.8 billion per year. The Obama administration recommended eliminating that program, but budgeted for only $3 billion per year cut because it assumed that farmers would sign up for the ACRE program if direct payments were dropped.

Conrad did not provide details of his proposal, but noted, “You can go too far on any of these things; I think part of direct payments should be retained,” along with “fundamental reform in ACRE and SURE [the crop disaster program] and the countercyclical program to simplify [it], but $8 billion more out of crop insurance — that goes too far.”

The Obama administration recommended cutting the crop insurance program by more than $8 billion per year by reducing payments to the insurance companies and slightly lowering farmers’ premium subsidies.

“Most people understand in this budget environment that agriculture has to be part of the solution, but the cuts should not be disproportionate,” Conrad said. “We have to keep in mind where we stand on the world stage. We have to keep in mind what are the essential elements that would allow us to be competitive in the world.”