This week, we've heard a variety of voices suggest that one of the top priorities for Congress this month should be to pass a farm bill. Let's be clear: Given the many things Congress must and should address, passing a horribly flawed, wasteful, trillion-dollar farm bill full of corporate welfare is not among them. Instead, we'd prefer it if the agriculture committees in both the House and the Senate would go back to the drawing board and come up with sound, affordable and accountable policies that make sense.
Let's review how we got here. The last farm bill (passed in 2008) officially expired at the end of September 2012, and since a new five-year bill failed to pass Congress that year, the January 2013 "fiscal cliff" deal retroactively extended farm programs for one year through the end of September 2013. Despite desperate efforts by the farm lobby and agricultural subsidy proponents to send a final bill to the president's desk in 2013, numerous road blocks got in the way of a final agreement.
Both the House and the Senate passed large, expensive, nearly trillion dollar bills that added more wasteful spending in the name of saving pennies on the dollar. However, the two chambers have so far failed to marry differences between the two pieces of legislation on such controversial topics as: how much food stamps should be cut; whether Soviet-on-the-Potomac price supports should be resurrected or not; how the dairy sector will be propped up by the federal government; how many catfish inspection offices taxpayers should support; and how to "save money" while increasing subsidies for one of the most profitable sectors of our economy.
And all the while, farm lobbyists are complaining that the sector can't do business without the clarity and certainly of a new farm bill. But even in this "uncertain" legislative climate, America's agriculture sector has been doing just fine, thank you very much. The U.S. Department of Agriculture estimates that 2013 farm profits will once again set a new record of $131 billion, despite Congress' failure to renew the farm bill on time. This sense of urgency that we need a farm bill is false, as evidenced by the status of the major programs that continue regardless of whether a new farm bill is passed or not.
Crop insurance, a program that provides a kind of profit protection at the expense of taxpayers that no other industry enjoys, makes unlimited payouts to farmers who earn profits, but just profits that are a little lower than expected. Crop insurance is now the largest corporate agriculture subsidy. This program is already permanent law, meaning subsidies for agribusinesses and crop insurance companies will continue in perpetuity unless Congress repeals them. The only urgency that should exist is to shrink the program and make it more accountable, transparent, cost-effective and responsive to modern farming practices, rather than expanding it and make it less accountable, as the bills passed by both the House and Senate did.
The Supplemental Nutrition Assistance Program (SNAP, aka food stamps) is a mandatory program, so as long as annual spending bills provide future funding, the benefits continue regardless of whether the farm bill is passed in a timely way. In fact, at Taxpayers for Common Sense, we think it would be better for everyone if the agriculture and nutrition safety nets were divided from each other, so reforms can be considered independently and debated on their own merits. For far too many years, the special interest wishes of farm subsidy proponents have dictated the outcome of agricultural and nutrition policies rather than the needs of average farmers and consumers.
Other programs in desperate need of reform also don't get the full treatment they deserve in the House- and Senate- passed bills. Both took steps towards eliminating direct payments, but instead of putting savings toward deficit reduction, they were instead plowed into new corporate subsidies for already profitable agribusinesses. This is despite the fact that these so-called shallow loss subsidies have already proven to be failures, as demonstrated by both lawmakers' and farmers' disapproval of the 2008 farm bill's Average Crop Revenue Election Program. Instead of revisiting the farm safety net over the past three years and making it more accountable and cost-effective, leaders of the agriculture committees devised even worse, open-ended programs that will provide a taxpayer payout when agricultural producers experience just a 5 or 10 percent drop in expected income.
In the coming days, we expect to hear some people worrying about the impending "dairy cliff," when USDA will be obliged by longstanding "permanent law" – which we revert to upon expiration of farm bill law – to artificially increase the price of milk. Don't be fooled by this red herring. Perhaps most obviously, Congress could simply address this absurdity of reverting to an obsolete dairy law that no one wants by passing a short-term farm bill extension. Taxpayers don't need a trillion dollars of new and unrelated spending just to solve this particular problem.
Then, over the coming year, lawmakers should get back to work to put together a fiscally responsible farm bill that saves real money rather than simply supporting the well-heeled industry interests so invested in our outdated system of subsidies.
Ryan Alexander is the president of Taxpayers for Common Sense.