Farmgateblog.com - Where farm decision-makers start their day

« Back to main

Monday, July 08, 2013

Splitting the Nutrition Title from the Farm Bill



 

It is not on the House of Representatives calendar for this week, but within the next 12 legislative days before the August recess, GOP Majority Leader Eric Cantor said, "Members should be prepared to act on a revised Farm Bill.” If you remember, the Senate has approved a new five year program for agriculture, and the June 20th House effort to do the same failed to get a majority supporting its own Ag Committee’s proposal.

 The key word is “revised,” and everyone following the progress of the Farm Bill proposals and debate for the past two years knows the word refers to separation of food and nutrition programs out of the Farm Bill.

Why is that a problem, since farm policy addresses rural America and food and nutrition policy is a metropolitan priority? Why is that a problem, since producing food and consuming food have a complex and lengthy economic path separating each other?  Why is that a problem, since food and nutrition programs make up 80% of USDA spending and the Agriculture Department could just focus on the $20 billion for conservation, rural development, commodity programs, and crop insurance?

It is expected that the “revised” Farm Bill proposal will only reflect agriculture programs since the Democrats voted against the first proposal because it did not spend enough on food and nutrition programs and the Republicans who voted against it said it spent too much.  Without any middle ground in that debate, the GOP leadership is proposing a solution that allows the House to vote on a separate farm policy and a separate nutrition policy.

Driving the proposal is the conservative Heritage Foundation which wants the separation as well as conversion of the food and nutrition programs into a “work activation” program for recipients of food stamps.  Democrats withdrew their support of the House Farm Bill proposal when an amendment was approved that required food stamp recipients to work.

President Hoover had opposed a government-funded food program saying “the hungry and unemployed will be cared for by our sense of voluntary organization and community service.”  Although he was defeated in 1932, it was not until 1938 when President Roosevelt initiated the program, but ironically opposed giving out free money and food without requiring work.

In that period of the Great Depression, USDA programs were initiated and eventually absorbed food stamps, which allowed consumers to have surplus food that farmers could not sell. The combination kept the nation from starving and kept farmers producing food and away from city unemployment lines.  Yes, today is different, but nutrition is still an issue, while the price of corn is above the 10-cent level of the 1930’s.

The problems with hunger in America will not dissolve in the next two years.  And in that same time span, larger crops could easily push commodity prices down to levels of unprofitability, based on current production costs.  The Great Depression will not return, but there will be some parallels.

That is one of the reasons why 532 farm organizations last Wednesday sent a letter to House Speaker John Boehner saying, “We believe that splitting the nutrition title from the rest of the bill could result in neither farm nor nutrition programs passing, and urge you to move a unified farm bill forward.”  They promised support of the food programs, which were not addressed by farm groups in their initial lobbying for the Farm Bill.

For decades, the Farm Bill has enjoyed bi-partisan support, and urban members Congress vote for it because of the food and nutrition programs, just as rural Congressmen support the farm safety net.  If farm and food policy were split, there is no reason for an urban Congressman to vote for soil conservation and crop insurance.

Then what?  

Carl Zulauf, agricultural economist at Ohio State University, says, “Given the current state of the relationship between farm and nonfarm household income and the current size of farms, it will be hard for the U.S. farm safety net to avoid continuing cuts.”  That comes from his perspectives on the relationship of income differences between farm and non farm families. He says, “Average household incomes can be compared back to 1960. In 1960, average farm household income was 65% of average U.S. household income. Thus, over the last half century, farm household income has increased substantially relative to income of U.S. households.”  But now he says every year since 1996 the average income of farm households has exceeded the average income of all US households.  That has also been the case in two out of three years going back to 1972.  (The farm financial crisis in the early 1980’s makes up the balance.)

With the financial separation between farm and non-farm households, Zulauf says it becomes harder for the public to support a higher farm safety net, and that is reflected by the reluctance of urban Congressmen to vote for high dollar farm programs.

If farmers are making so much money, where does it come from?  You may not be one of those families, but they are out there, and Zulauf points to two dynamics at work.  “One is the increasing size of the farm production unit, which in turn is partially driven by technology. The second is the increasing role of nonfarm income (also referred to as off-farm income).”  That non-farm income for some large farms is more than the average US household income.  And while it may not be needed for survival of the farm, it may be a risk management strategy, says Zulauf.

So what is at issue? Zulauf says is the vote that will soon be coming on a Farm Bill that will likely not have any nutrition title, and will be 20% of the cost of the last Farm Bill due to elimination of food and nutrition programs.  If an urban member of Congress sees a threat to his constituents, he or she may be unwilling to support a farm policy that is disconnected to food stamps and other nutrition programs.  Zulauf says, “Lower spending on the farm safety net will make it difficult to reach agreement because each farm actor wants to protect their part of the farm safety net. It would be easier to craft a new farm bill if projected baseline spending in the future was higher, but that means farm income would have to decline. Higher government spending on the farm safety net as a result of lower farm income may not be a desirable situation for the U.S. farm sector.”

Summary:

The pending re-introduction of the Farm Bill will likely be similar to the legislation that failed on June 20th, but without the nutrition title and $80 billion per year in spending on food and nutrition programs.  Splitting the farm and food policy will put farm policy at risk of not being approved, since urban members of Congress would see no reason to support it, and see that farm incomes are currently above that of median household income.

Posted by Stu Ellis on 07/08 at 08:47 PM | Permalink

Comments

Sadly, Washington has degenerated into a game of making political points and playing to one's base. Governing and finding solutions to the nations problems no longer is the goal of legislating. While splitting the farm bill plays well to the far right, I fear that all it will accomplish is no farm bill at all and no changes to SNAP. Your reference to Roosevelt and the "no work, no food" is clearly pandering to the right. You may wish to do some homework before you make such comments. You might be surprised to find out that not everyone receiving SNAP is healthy and young (or old) enough to work for their supper. Believe it or not, few people want to be on SNAP. When you take this attitude the real risk you run is for the urban dwellers to tell agriculture to take a hike. The smart people in agriculture are finding out it's important to have Democratic friends as well as Republican ones. There is very little likelihood of one party controlling all branches of government any time soon. We in agriculture need to be focused on our issues and find friends and support wherever it may be irrespective of party. Bob: I agree with your analysis, and there is so much at stake that it should be troubling to everyone in agriculture. Regarding your assessment that I am pandering to the right, I am typically accused of pandering to the left. I was surprised to learn that FDR had advocated a "workfare" type program. After managing an urban Extension office that had hundreds of SNAP clients to educate about nutrition, I am well aware that many cannot work. I am close to an 18 month old who benefitted from food stamps and certainly she could not work. At a hospital I volunteer at weekly, I see many patients who cannot work, and depend on food stamps. While that is only an unscientific sampling, it tells me there is a need for compassion. One of my concerns was the fact that agriculture seemed to be absent in the initial debate on cutting the SNAP program, but now jumped on board with the letter from the 532 farm groups to the House Speaker. Interestingly, there were few large agribusinesses on the group, but it may have been a reflection of the process of collecting signatures. ~Stu

Posted by: Bob Viering at July 8, 2013 10:10PM

This is sheer absurdity to think that urban lawmakers can't see the need for Farm assistance. Maybe someone can take the time to explain to them that they will NOT HAVE FOOD if not for farmers?? I have made my living off the Ag sector for 12 years now and I love the America farmer. With that said, this nation HAS NO MONEY, this is a pretty crucial factor when weighing almost a trillion more in spending on mostly welfare. This country is going to make hard choices in the coming years. This will happen one of two ways, either we will grow up and look at the cliff we are going over fiscally, or more likely, we will see the ground speeding towards us after we go over that cliff. We need a farm bill, this NOT a farm bill, this is a welfare bill we can not afford. The entire foodstamp system is a corrupted waste of money and I as a US taxpayer am FED UP with the dead weight. Have you ever been to an elementary school and witnessed kids that already ate breakfast at home dumping full trays of food in the garbage because the FEDS demand that every child be served a meal?? How well do you think that works in solving hunger issues?? Have you ever seen or known of the underground market where food stamps are fraudulently traded as currency to buy beer, smokes, and street drugs?? You may be fine with that, I am not. It is really hard to imagine the American Farmer being so greedy that they aren't willing to make a stand on principle, is that where we are?? Are farmers and AG related industries perfectly happy with having a deck chair on the US Titanic as long as it's comfortable as it sinks?? Common sense has never been more uncommon than it is today and that is very sad. It now appears that the politics of "me, me, me" is the ONLY factor used in personal political choices?? Todd: Amen. ~Stu

Posted by: Todd M. at July 11, 2013 3:03PM

Post a comment

*Name:

*Email:

Location:

URL:

SPAM? Leave this blank unless you are a spam-bot.

*Comment:

Remember my personal information

Notify me of follow-up comments?

*Required