What is in this article?:
- Budget will be dominant factor in crafting 2012 farm legislation
- Impact of debt limit on spending
“The 2012 farm bill is going to be one where the budget will dictate policy,” says National Cotton Council vice president for economics and policy analysis Gary Adams. In negotiations for crafting the legislation, "there will be one overriding theme — budget, budget, budget."
Impact of debt limit on spending
The U.S. debt limit will be reached sometime in early August, Adams notes, and “we anticipate that the Congress will broker some kind of agreement with the group headed by Vice President Joe Biden. But any agreement to raise the debt limit likely will be coupled with spending cuts and cuts to agricultural programs.
“This could add more short term pressure if they need to move quickly to enact some kind of measure to increase the debt limit.”
Current spending on agriculture programs is fairly small, Adams points out.
“With commodity prices as high as they are, the government isn’t spending any money on countercyclical programs or the marketing loan. The biggest thing from the standpoint of spending on commodity programs is direct payments. I think we need to be prepared for direct payments to be the focus of a lot of attention as we go forward with the farm bill debate.”
There is going to be a lot of discussion, Adams says, as to whether farm programs and supports are equitable — not just across commodities, but across programs as well.
“Debate about reform of payment limits and eligibility, which we saw in the appropriations process, is likely to continue. Congress will give some scrutiny to whether there is duplication and overlap between programs such as SURE, ACRE, and others, and attempt to minimize those overlaps. And there will be a careful examination of alternatives that may be available for some of these programs.”
The plan for the new farm bill, he says, is for 2011 to be mostly for hearings and 2012 to be for writing the legislation.
“Hearings are under way now by both the House and Senate. The House is reviewing various parts of the 2008 legislation. The Senate has announced some field hearings. Mostly, they’re just trying to lay the groundwork for 2012, which is when the heavy lifting will take place in crafting the new legislation.”
The debt limit agreement and potential changes or cuts to the 2008 farm bill could alter that timetable.
“We expect that the next year and a half will be very busy, particularly through the next election cycle,” Adams says, “and we will continue to need the support of everyone in agriculture.”
Recently, he says, in the appropriations debate in the House, “NCC members stepped up and made calls to their representatives to let them know how important it was that they fight amendments that would’ve done a lot of damage to the cotton program.
“This kind of action may be required several times as we move forward with this process of trying to preserve a strong safety net for agriculture.”