Will House Farm Bill Negotiators Give Too Much to Senate?

November 14, 2013 02:03 AM

via a special arrangement with Informa Economics, Inc.

Any move to 'all-in' has some worried about a watered-down farm bill that limits use of farmer-choice options

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

It looks like recent farm bill discussions among the four principals and some key staffers have been two steps back and perhaps one step forward, at best, based on usually reliable sources.

Should all-in be all-out? At this stage in the farm bill process, sources signal some House conferees may be contemplating giving too much relative to the Senate's big push for all-in because Senate conferees and staff apparently do not want farmers to have to choose between a revenue loss (Ag Risk Coverage/shallow loss) or price (target) loss approach for fear the vast majority of farmers would choose price, as some outside analysis seems to suggest.

What is cut, how much and where from?
But to go all-in relative to farmer safety-net programs, the key is how much existing proposals relative to revenue and price loss programs would have to be watered down in order to accommodate the all-in push. Veteran farm bill watchers say a question should be raised whether or not an all-in is the right way to go, especially if what is now a viable safety net program in the pending farm bills is watered down and lacks flexibility.

SCO changes ahead? Some sources report that if an all-in approach to Title I (safety net) policy is taken, a key change could be in store for Supplemental Coverage Option (SCO) eligibility. If so, sources again think that would be an inadequate compromise.

CBO scoring woes. Contacts also signal that the conferees and staff are surprised at some of the scoring they are getting from the Congressional Budget Office, which typically means higher costs for various farm bill proposals and thus the need to alter provisions.

All of this is familiar at this stage of the farm bill process.
But it certainly appears that a recent meeting among the four principals was a stop backward on getting agreement, and that now Title I issues are mounting.

Stabenow active on actively engaged. Besides this, sources say that Senate Ag Chairwoman Debbie Stabenow (D-Mich.) for some reason is digging in on actively engaged language. If so, that would open up all sorts of grower concerns.

One farm bill veteran said, "For those pushing an all-in approach, someone I hope is asking, "Why? What is wrong with giving farmers an option? Let them decide between a revenue or price loss approach, but not both because qualifying for both would be costly and mean some potential significant changes to safety-net proposals that have garnered some farmer support. Why water those down just to appease some Senators or staff who are worried about farmers choosing one program or another. This sounds like a return of the ACRE problem where less than 10 percent of base acres signed up for that program. So what. At least farmers had the choice."

A touchy area is the complexity in Title I proposals.
Says one long-time farm bill expert, "If you pull staff out of the negotiating room, I wonder how much the principals really know and understand about these complex issues?"

Key: What is the farm bill objective of Title I? Seasoned farm bill observers concur that apparently conferees need to be reminded to always ask what the objective is relative to Title I. The objective, they say, should not be to get a compromise. The objective, they conclude, should be to provide growers of different commodities in different regions of the country the best safety net from a risk management perspective. When the current farm bill debate first started, three key guidelines were noted, as follows:

-- Farm policy must work for all crops and all regions of the country.
-- Farm policy must be able to protect against multi-year deep price declines like we saw in the late 1990s.
-- Do no harm to crop insurance and make improvements where possible.

A good list of guidelines... if followed.


NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.



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