Farm Bill and Debt Limit

 The cynic in me applauds President Biden's tactic of inviting a bipartisan delegation to the White House to discuss the new farm bill.  Why am I cynical?  While negotiations over farm bill provisions got White House attention in the 1960's and 70's, they haven't gotten that much in recent decades.  

But this year the current farm bill is expiring just as the issue of raising the debt limit and cutting spending is at the forefront.  One of the things the House Republicans want to cut is food stamps (SNAP) which is a title in the farm bill.  IIRC if the bill the House passed were actually implemented, USDA would see its spending reduced to 83 percent of current. But farm state Republican senators, which likely includes them all, listen to their farmers so Biden is putting the squeeze on.  In effect he's saying two things: 

1. you need to help resolve the impasse over debt limit so we can move on to the farm bill, and
2. you need to oppose the provisions in the House bill to make cuts, particularly in SNAP, in order to get the Democratic votes you will need to pass the farm bill.

Well played, it seems, at least at this moment.

New House Rules for Farm Bill

 Under the new House rules, each bill must have a single subject. I'm wondering how they'll describe the farm bill.

Disaster Programs

 During much of my time at ASCS/FSA the agriculture policy community was pushing the idea of moving from disaster payment programs to crop insurance, an effort which culminated in the 1996 farm bill, along with Sen. Pat Roberts' "Freedom to Farm".

Back on July 28 House Ag passed another bill deviating from that path.  As quoted by Illinois extension, Chris Clayton summarized: 

"“The bill, passed unanimously by voice vote, will expand coverage of losses under USDA’s Wildfire Hurricane Indemnity Program-Plus (WHIP-Plus) and cover losses including those from wildfires last year in California as well as the derecho that hit Midwestern producers last summer. The aid will also cover producer losses this year from the polar vortex as well as farmers whose crops are in D-2 ‘severe’ drought conditions for at least eight consecutive weeks.”

HR 2--Farm Bill

HR2 has now passed both Houses of Congress.  Here's a summary:

"The bill modifies agriculture and nutrition policies to:

• require farmers to make a new election to obtain either Price Loss Coverage or Agricultural Risk Coverage for the 2019-2023 crop years, which may be changed for the 2021-2023 crop years;
• replace the Dairy Margin Protection Program with Dairy Risk Coverage and modify coverage levels and premiums;
• make Indian tribes and tribal organizations eligible for supplemental agricultural disaster assistance programs;
• reduce the adjusted gross income limitation for receiving benefits under commodity and conservation programs; [the nieces and nephews provision[
• modify funding levels and requirements for several conservation programs,
• consolidate several existing trade and export promotion programs into a new Priority Trade Promotion, Development, and Assistance program;
• legalize industrial hemp and make hemp producers eligible for the federal crop insurance program;
• establish an interstate data system to prevent the simultaneous issuance of Supplemental Nutrition Assistance Program (SNAP, formerly known as the food stamp program) benefits to an individual by more than one state;
• increase the loan limits for farm ownership and operating loans;
• modify the experience requirement for farm ownership loans;
• authorize a categorical exclusion from requirements for environmental assessments and environmental impact statements for certain forest management projects with the primary purpose of protecting, restoring, or improving habitat for the greater sage-grouse or mule deer; and
• modify the organic certification requirements for imported agricultural products."

I find I'm no longer current enough with the law to comment.  "Qualified pass-through entities" instead of partnerships and joint ventures?  Don't know what it signifies. 

https://www.congress.gov/bill/115th-congress/house-bill/2

Bipartisanship in the Senate

Despite the acrimony, in the right circumstances the Senate can pass bills on a bipartisan basis.

They did so this week with the farm bill.  And a Senate committee  passed a bill restructuring the way musicians are paid.

Neither issue is terribly partisan, at least for the Senate.  The right wingers in the House force a split on the issue of work requirements for SNAP, but they finally got a version passed there.   It will be interesting to see how well the two houses work to reconcile differences and pass final legislation.

Farm Bill In the Senate

DTN reports on the progress of the Senate's version of the farm bill.  And from there you get this:

Censky also said that the Trump administration is continuing the modernization of technology at USDA and that officials hope that all the programs in the 2018 farm bill will be available online.

Farmers will still need to go to county Farm Service Agency offices to sign some papers, but Censky said he hopes farmers will be able to deal with applications and other forms online from home before going to the office. Farmers uncomfortable using a computer will still be able to go to the county office to fill out paperwork, he said.

I note there's a provision requiring use of the same county yields, requiring reconciliation of NASS and crop insurance figures.   

A Rocky Road for the Farm Bill

Apparently two sets of hurdles for the farm bill:

• one is the fight over the provisions in the bill, most notably the tightened work requirements for SNAP, but also other issues.
• the other is its status as close to must-pass legislation (it's not really must-pass--Congress could always kick the issue down the road by doing a one-year extension of the current farm bill.  But Congress doesn't have much going on, so the farm bill is the best bet to use for leverage on other issues, like the quest for a vote on immigration legislation.  That's what resulted in today's defeat of the bill.

A Veto for the Farm Bill

It's been decades since a President threatened to veto a farm bill--so long that the last time has escaped my memory.  (I'd be pretty sure that Truman may have threatened but I don't believe anyone since Nixon.)

But President Trump is promising a veto to ensure work requirements for SNAP.   This will be interesting.

Program Costs and Farm Bill

From Illinois extension on farm bill:

Spending on Farmers: Commodities and Crop Insurance

The main components of the support system for commodity farmers are the farm programs in Title I of the Farm Bill and crop insurance. The information from CBO in Table 1 indicates that farm programs are currently on track to spend roughly $13 billion more than forecast in 2014. At the same time, the outlays for crop insurance are expected to be $11 billion less. Chart 4 provides a comparison of the outlays as projected in 2014 with outlays as reported and updated by CBO. Again year 1 corresponds to crop year 2014 and fiscal year 2016 for farm programs, but fiscal and crop years match for crop insurance.

Cottonseed Makes It In

Cottonseed will be a program crop in the farm bill according to Keith Good.

I've lost any expertise I once had in this area, but this might be a way for the cotton people to get more federal money, without raising what we used to call the target price for cotton.  They might be trying to get around Brazil and the WTO, but that's only speculation.

New Yorker and Small Farmers

The New Yorker has a piece on the 2018 farm bill and the plight of small farmers:

The U.S. Department of Agriculture estimates that, between 2013 and 2016, net farm income fell by half, the largest three-year drop since the Great Depression. Some forty-two thousand farms folded during the downturn, and small and medium-sized operations, such as the Fitches’ [upstate dairy farm serving as the hook for the story], proved particularly vulnerable.

Farm Bill Time?

According to the House Ag committee, which has a website for it.  Hattip to Northview Dairy. 

You'd think after 20 years I'd be able to divorce myself from any interest in such doings.  Can't teach an old dog...

New Farm Bill Discussions

Uof IL extension has discussion of 2018 farm bill:

Separately, Doug Rich reported earlier this month at the High Plains/Midwest Ag Journal Online that, “Economic conditions are much different today as Congress begins to work on the 2018 farm bill than they were in 2014 when the last farm bill was passed. Farm income this year will be about half of what it was in 2014. However, most farmers would be happy if Congress passed a bill that is very similar to the 2014 legislation with just a few changes.
“This was the consensus of many who attended the 2018 Farm Bill Summit held Oct. 18 at the University of Missouri Bradford Research Center in Columbia, Missouri.”

I've commented elsewhere on the increasing size of family farms.  I suspect, without thinking about it, that there's increased volatility in farm income correlated (as a result of?) the increased size.  The big farms back in the salad days of the the middle Obama administration were raking in incomes well above average, so cutting income in half while painful still leaves a substantial profit.

Conaway and the Farm Bill

Politico has a post on the discussions between Rep Conaway, House Ag head, and Rep. Black, House Budget head.

Sources with knowledge of the discussions say that the agriculture committee was initially facing around $70 billion in proposed cuts over the next decade, but Conaway's intervention kept the pullback to around $10 billion. That came after Black lowered her original goal for total mandatory spending cuts by roughly $300 billion, and Conaway persistently made the case that slashing programs under his watch would imperil the 2018 farm bill and, by extension, farmers, rural constituents and low-income Americans struggling to make ends meet.

More on Cotton

IL extension has a comparison of cotton support versus other commodities

Cottonseed Again

Illinois extension has a post on the cottonseed issue.  As it says, in greater detail than I have the brain cells to waste on, it's complicated, involving both the base acreage/"generic base" issue and WTO.  From the conclusion:

Much depends on the final details of any Congressional response but cotton farmers are currently receiving significant assistance from the 2014 Farm Bill and adding cottonseed may provide a windfall to them, including one recoupled to cotton planting decisions. Congress, if considering adding cottonseed, may also have to consider further revisions to the 2014 Farm Bill such as precluding payments on generic base acres for any covered commodities planted on them.

Farm Bill--Cotton Issues

Cotton producers are pushing for changes in the program when the 2018 farm bill is written.  Oilseed coverage for cottonseed production, which was denied by Sec. Vilsack as being beyond his authority, is an issue, as is converting "generic" base acreages to cotton acreages to provide a basis for a new program.All this according to Keith Good's post here.

Farm Bill Time

Congressional Research Service has a report apropos of the 2018 farm bill.  This is an excerpt from a table of the projections and actual expenditures under the current law.

Farm Bill Titles (sorted)

		Projection for FY2014-18	Share	Actual FY14-16; Proj. FY2017-18	Change since enactment
IV	Nutrition	390,650	79.9%	364,837	-25,813
XI	Crop Insurance	41,420	8.5%	30,533	-10,887
II	Conservation	28,165	5.8%	24,378	-3,787
I	Commodities and Disaster	23,555	4.8%	36,040	+12,485

Farm Bill Stirrings

The first Congressional work on the next farm bill is starting.  This piece focuses on what the cotton growers want.  Here's the Economic Research Service's backgrounder (seems to me when I started work there were maybe 100,000 cotton farms, in 2007 it was down to 18,000, no doubt fewer now.

A quote: "Trade is particularly important for cotton. About 30 percent of the world's consumption of cotton fiber crosses international borders before processing, a larger share than for wheat, corn, soybeans, or rice. Through trade in yarn, fabric, and clothing, much of the world's cotton again crosses international borders at least once more before reaching the final consumer."

Farm Bill Debates

A Think Progress post here farm bill issues: specifically will the Republican dominance lead to an attack on food stamps or on environmental regulations.

Illinois extension here has a discussion of the baseline for the farm bill's farm programs--perhaps $10 billion a year.  I believe that's higher than the current bill's baseline was.  ("Baseline" is, if I understand, the Congressional Budget Office's estimate of future costs, over 10  years, if all Congress did was to extend current farm bill provisions with no change.)