There is no argument that the farm bill passed out of the Senate Agriculture Committee on Thursday was bipartisan. It was not, however, regionally inclusive as all four senators on the committee from the South – Arkansas’ John Boozman, Georgia’s Saxby Chambliss, Kentucky’s Mitch McConnell and Mississippi’s Thad Cochran -- voted nay.
And those nay votes didn’t occur prior to the senators taking time during the markup to explain the negative impacts the legislation would have on southern agriculture – especially for rice and peanut producers.
Also of interest to growers will be a change in the Adjusted Gross Income (AGI) test from $900,000 to $750,000 to qualify for farm programs. The amendment offered by Iowa Sen. Charles Grassley would also change qualification wording from “active personal management” to “actively engaged.”
An unhappy Sen. Chambliss – who was especially vocal during the markup -- said the change in wording had come at a late hour. “I didn’t realize, because we didn’t get to see the amendment until very early this morning … about the change in the definition of ‘actively engaged in farming.’
“This is a huge change that will impact every single farm in America. It will change who does qualify and who doesn’t. I think that’s a huge mistake.”
Guest workers, the Harvest Act
The agricultural labor force and a workable H2A guest worker program were also atop Chambliss’ agenda. “It’s of critical importance that we discuss this issue … because everybody involved in agriculture is having the same problem across America with respect to an agricultural workforce that we know to be legal.
"The only guest worker program out there today is the H2A program, which is very cumbersome and very expensive. Most of our farmers simply don’t want to go through the hassle. Whether you’re farming specialty crops or running an agricultural business, you need to be able to depend on a quality supply of legal workers.”
Times have changed in a dramatic way, continued Chambliss, who played up “the Harvest Act,” which he said would be discussed further on the Senate floor. “Basically what this does to H2A is make it more workable, more farmer-friendly and says a farmer may bring in a supply of labor from outside the country for a period of 10 months. (The worker) will then have to go back for two months before coming back into (the United States).
“They don’t have to be here for 10 months. Most farmers, under H2A, bring in workers for 90 days, 120 days, whatever their particular need is. Then, the workers have to go back…
“We’re about 60 days away from harvesting Vidalia onions in the central part of Georgia. That commodity depends on workers who do the type of work that, frankly, most American workers don’t want to do. You have to bend over, cut the onions, dig them up. That’s just an example of one form of specialty crop farming in Georgia that relies very heavily on imported workers.”
Michigan Sen. Debbie Stabenow, committee chairwoman, said “everywhere in Michigan … I hear the same thing.”
Heavy regulations, trade issues
Sounding a common complaint, Sen. Boozman offered, and then withdrew, several amendments targeting “heavy-handed regulations that have a negative impact on variety, quality, availability and affordability of food for the American family. Excessive regulation, duplicative permit requirements – all of these things are so burdensome.”
He proposed the Secretary of Agriculture be provided the ability “determine whether any proposed major regulation would have a negative effect on access to affordable food. If the secretary makes such a determination an expedited congressional review would take place.”
Pointing to a law already on the books, trade with Cuba was addressed by Montana Sen. Max Baucus. Baucus pulled few punches in calling out trade opponents, who have thwarted “Congressional intent” through onerous regulations regarding how shipments to the island nation are paid for. “Let’s not forget that the United States is one of the few countries that don’t trade with Cuba. And we’re losing out. … Frankly, this has to do with presidential politics in Florida and I think it’s wrong.”
For more on Cuba trade, see here.
A study to consider a reorganization of the USDA’s trade function was advocated by Nebraska Sen. Mike Johanns, a former Secretary of Agriculture. “Trade is absolutely critical to American agriculture. The U.S. exported $136 billion last year. … One of every three acres of production goes into the foreign marketplace. Increasing (overseas) populations, affluence and urbanization will require our farmers to grow more efficiently and put tremendous pressure on our trade functions…
“Thus it’s increasingly important that USDA ensure that our trade is open and based on science.” As former head of the USDA “I know well the importance of the department responding quickly and aggressively to … non-tariff trade barriers. If there was a surprise at the USDA in my time as secretary it was how much time I devoted to trade issues.”
As part of the trade study, Johanns said “the secretary may include a recommendation for the establishment of an under-secretary for trade in foreign agricultural affairs.”
Baucus agreed with the study proposal. “The United States does not spend enough time thinking about trade. … We’re missing the boat when we don’t more aggressively market our products, spend more time working on trade issues.”
Rice and peanuts
The treatment of rice and peanuts in the proposed legislation has been a huge peg for southern lawmakers to hang their opposition upon.
“Fairness is important,” Boozman said in the markup. “The result of the bill we have now is we’ve picked winners and losers. … The reality of that is it will make it more difficult as we go to the floor. I think it will make it much more difficult as we deal with the House.”
Stabenow, who had been softly chided during the markup, conceded the point to a degree. “We know there’s more work to do. … By proceeding with the STAX program (Stacked Income Protection Plan for cotton) and some other areas, we’ve made steps. Not as far as we need to.”
For more on STAX, see here.
The committee, said Stabenow, has worked “very, very hard. And there’s more to do. But we do have the STAX program for cotton. Within the new Agriculture Risk Coverage (ARC) program, we have specific reference points, prices, for rice and peanuts (set for rice at $13 per hundredweight with a minimum reference price for peanuts at $530 per ton). And we’ve put in place new crop insurance options – we know they aren’t fully developed.”
Near the end of the markup, in lieu of offering several amendments, Chambliss preferred to detail his opposition to several things in the proposed legislation. First up: payment limits and peanuts.
For more on a House hearing involving peanuts, see here.
“As I understand it, under the mark, the limit now is at $50,000. Economists at the University of Georgia have looked at this. With the change that’s being made, the way the mark is written in respect to peanuts, I doubt there will ever be a peanut farmer that will qualify up to the level of $50,000. Peanuts are a high-cost commodity and … (have) capital requirements in terms of machinery. You have to have a special digger to dig them and a harvester to harvest them. That’s unlike what you can do with changing heads (on harvesters) for soybeans and corn.
“We’ve experienced wide swings in crop prices because we’re not a traded commodity. … That can lead to large payments during low commodity price years under the current program. Given the concentration of buyers of peanuts and the semi-perishability of peanuts … all of these issues come into play.”
Rice, Chambliss said, has some similar issues. “It’s hard to drown out rice because it grows in water. Therefore, crop insurance with rice works in an entirely different way from … corn or even cotton and peanuts.”
Chambliss predicted that if the House takes up the bill “at all” it will be “more in the direction of what (senators from the South) have proposed … with respect to both peanuts and rice.”
Prior to casting his “no” vote, Sen. Cochran said “on the floor of the Senate, I think we’ll have to take advantage of opportunities to offer amendments that may have a chance of strengthening the bill, particularly as it relates to southern interests. Specifically, cotton, rice and peanuts deserve more of a break than they’re getting in this bill in this committee. I regret that. … In the meantime, I can’t support the bill.”