Tighter farm bill schedule?

STOWE, Vt. -- The passage of the law to raise with the debt ceiling and cut the federal budget deficit will not include immediate cuts to farm programs, but may lead to a rewrite of the farm bill on a tight schedule later this year rather than in 2012, key legislators told sugar growers from around the country who were meeting in Stowe, Vt., recently.

President Obama signed the bill Aug. 2 after the Senate passed it by a vote of 74 to 26 and the House passed it 269 to 161.

The bill will have "no effect" on agriculture programs before 2013, Rep. Michael Conaway, R-Texas, the chairman of the House Agriculture General Farm Commodities and Risk Management Subcommittee told the American Sugar Alliance by videoconference Aug. 1.

But Conaway also said that, while House Agriculture Committee Chairman Frank Lucas, R-Okla., has been proceeding with "regular order," meaning that the farm bill rewrite would occur next year because the bill expires Sept. 30, 2012, the rewrite may occur this year as a result of the deficit discussions. The bill creates a 12-member joint congressional super committee that is supposed to write legislation by this fall to cut the deficit by $1.5 trillion. The agriculture committees in the House and Senate are supposed to make recommendations to the super committee.

December deadline?

In another videoconference to the group Aug. 2, Senate Budget Committee Chairman Kent Conrad, D-N.D., confirmed that the debt ceiling-deficit reduction bill will not cut farm subsidies in the short run, but said that if the congressional joint super committee does not come up with a deficit reduction proposal by December, automatic triggers will affect farm programs.

"Agriculture spending is not included in the first stage, but if there is a sequestration agriculture would be included because those cuts would be across the board," Conrad said.

Conrad also told the cane and beet growers that the sequestration would not have a direct effect on the sugar program because the sugar program is operated on a no net cost basis to the government, but that if other farm programs have to take cuts there will be pressure to change the sugar program as a matter of fairness.

People "argue that sugar should take a hit even though it is a no cost program," Conrad said.

In the past, during tough budget times Congress imposed a fee on sugar growers to run their program.

Conrad said he does not know whether the deficit reduction process under the joint committee will include writing the new farm bill this fall rather than waiting until 2012. Conrad said that it is more likely that the bill will be written in 2012, but added, "I personally do not believe we are advantaged by waiting."

He said there had been proposals to wait when the 2008 bill was written but that he recognized the budget situation was getting worse and forged ahead with the bill.

"It is in our interest to move quickly," Conrad said, adding that he thinks the process will start in the Senate. Conrad said the new farm bill should reduce program complexity but also contain a disaster program that is funded for the life of the farm bill. "None of us knows when the next slump in prices comes in the future," he said.

Conrad also said the new farm bill should address the 37 programs that do not have a baseline after the 2008 bill expires and make a provision for renewable fuels. But he acknowledged that maintaining support for ethanol is difficult.

"Ethanol is very challenged," Conrad said. "The support has really dropped away."

Referring to a proposal from Sen. Amy Klobuchar, D-Minn., and Sen. John Thune, R-S.D., and others to end the ethanol tax break but improve the ethanol infrastructure that did not make it into the debt ceiling bill, Conrad said, "It will be very difficult to resurrect a fair compromise." But he concluded, "We have to keep trying."

Reducing dependence on foreign oil is the most important goal for government after reducing the deficit, Conrad said.

Details of the bill

The debt ceiling bill requires $900 billion in immediate spending over 10 years cuts in exchange for raising the debt ceiling. It includes no new taxes. The bill also sets up a procedure for further cuts before the president could raise the debt ceiling again. It provides for votes on a balanced budget amendment, but that seems unlikely to pass the Senate.

It's much more likely that the joint committee will make recommendations. If the committee fails to act, there would be automatic cuts in both domestic and defense spending.

Congress and the new joint committee will be on a tight schedule for the rest of this calendar year:

n Aug. 16: Majority and minority leaders of the House and Senate each will appoint three members of the 12-member committee.

n Oct. 14: Each committee of jurisdiction in the House and Senate will report its recommendations for cuts from the programs under its jurisdiction.

n Nov. 23: The joint committee will vote on a bill.

n Dec. 2: the joint committee will release legislative language on the bill.

n Dec. 9: The committees of jurisdiction will recommend whether to pass the committee bill.

n Dec. 23: The House and Senate must vote on the bill.

Spotlight on nutrition

The biggest battles may not be over the farm programs, but over the nutrition programs that now make up more than 70 percent of the USDA budget.

The bill appears to protect the supplemental nutrition assistance program, or SNAP, which previously was known as food stamps, and probably protects the special nutrition program for women, infants and children known as WIC from immediate cuts, but neither program is protected from long-term cuts. There is a precedent in a 1985 budget control act to include WIC and food stamps in low-income programs that are exempted in the short term.

While SNAP is an entitlement program with mandatory spending on all who qualify, WIC is a discretionary program that makes up about half the appropriated agriculture budget. If WIC is protected, other agriculture programs such as food safety, research, energy, rural development and conservation would have to bear the brunt of the cuts.

If it is not protected, there is likely to be a big political battle over the question of cutting aid to low-income mothers and children.

Both the SNAP and the WIC programs would be eligible for cuts when the super committee considers changes to entitlements. President Obama has said that cuts to entitlement programs will not solve the entire deficit and that he will push for an end to tax loopholes and a simplification of the tax code as part of the process.