Last week, the House Agriculture Committee held the first hearing on the 2012 Farm Bill, the legislation that lies at the heart of US food and agriculture policy. Change is in the works. "I think it will be very difficult to pass a status-quo farm bill in 2012," said Chairman Collin Peterson (D-MN). "I think it's inadequate."
Unlike previous versions, which have basically re-certified existing regulations, debate over the next Farm Bill may forever alter the way we grow, ship, produce, and eat food in this country. It is possible that the current subsidy system may be scrapped entirely. The rule changes could remove current incentives for farmers to raise only a few crops and focus instead on a system that acts more like insurance support system that would reimburse farmers for crop losses due to bad growing seasons as well as when prices fall below a certain floor, which is how the current system works.
According to a Huffington Post article by Paula Crossfield, Managing Editor of civileats.com.
Currently 70% of farm payments go to the wealthiest 10% of producers of corn, soybeans, wheat, cotton and rice. These kinds of oversights are the result of a Farm Bill that has been largely cobbled together over time.
As with most areas of commerce in this society, the market is shaped by the rules that regulate it. As we have seen with the SEC and the Goldman Sachs situation, the lack of oversight and regulation can have disastrous effects. I would argue that more citizens are affected on a daily basis by the agricultural sector than the financial sector. In fact I write these diaries because I feel that food and agriculture play an important role in all of the issues that affect us every day. Food affects health care, it affects education, it affects labor relations, and it affects the environment just to name a few.
If the 70%/10% statistic is true, then something has gone horribly wrong in our agricultural system. Large scale farming is absolutely necessary to feed the urban areas. And much has been made of the statistic that more people now live in cities than in rural areas. But large scale agriculture doesn't have to mean that only a few large companies control all of the agriculture that takes place in the country. Hopefully the new regulations can address that issue.
The bill, which is renewed every 5 years, affects farm payments, supplemental nutrition assistance programs (SNAP, formally called food stamps), international trade, conservation programs, agriculture research, food safety, and more. The Farm Bill affects more than just farms and farmers. It affects all of us who eat. It affects what, how, and where we eat. It affects how the food is grown and where it is shipped. It affects what is grown, where it is grown, and how it is grown.
Secretary Of Agriculture Tom Vilsack addressed the first committee session in Washington.
“Mr. Chairman, as we move forward toward development of the next Farm Bill, it is important that we approach this new legislation with an eye toward truly making a difference in the future of the lives of millions of rural Americans. If we set our goals appropriately, we can properly assist and strengthen production agriculture, while also building and reinforcing the future of rural communities. Every opportunity for bettering rural America should be considered. We need to adopt innovative approaches and listen to the needs of production agriculture and rural communities. Again, I believe it is important to be ambitious and set our goals as high as possible. Rural America deserves no less from the next Farm Bill.
“Over the past year, I embarked on a rural tour. During this process, I traveled more than 45,000 miles and met with countless local farmers, ranchers, town leaders, teachers, etc. While the process took time and involved very difficult travel, I came away with a greater appreciation for the will and determination of rural America to succeed. I also came away with a stronger appreciation for the needs and challenges that rural America faces.
“In the coming months as we engage in development of the next Farm Bill, I look forward to bringing the experiences of these rural Americans, and others I have worked with to the table. I also look forward to offering the insights and expertise of our professional USDA staff, who have had the experience and pleasure of partnering with and learning firsthand about the needs of producers in the field. It is my pledge to appropriately assist, provide technical assistance and help better frame and push the debate toward the topics and issue areas that are most important to our constituents. I look forward to working with you, Mr. Chairman, and every Member of the Committee on that endeavor.”
Rep Collin Peterson (D-MN)
Rep Peterson mentioned a program called ACRE as one that might offer a roadmap to future regulations. ACRE, Average Crop Revenue Election, an option created in 2008, is the first program to shield farmer revenue from poor yields as well as low prices. Price support payments now are triggered by low prices. Critics say they provide little support when growers lose a crop to bad weather. There also are complaints that support rates are too low, compared to rising production costs. Besides mentioning ACRE as a possible model, Peterson said attention also was being given to a "whole-farm revenue" concept. It could allow more cropping flexibility than ACRE, which is tied to growing a specific crop. In the long run, he said, the United States could move to an insurance-like support system.
from Reuters
As part of farm bill work, Peterson said he has compiled data on support given to major crops through subsidies and crop insurance. On average, subsidies equal 5.8 percent of the value of those crops, he said, but the value of federal supports varies widely by crop.
Peterson has asked farm groups to consider if a better system can be arranged than the hybrid now in use. Three types of support are available to grain, cotton and soybean growers -- a guaranteed annual payment based on past production, a "loan deficiency" payment made when prices are below a minimum set by law, and counter-cyclical payments made when returns from sales and subsidies are below a target set by law.
By comparison, ACRE has a higher price guarantee. Farmers get a payment when revenue from a crop falls at the state level and on their farms. ACRE went into operation last year, attracting 13 percent of eligible land. Participation is highest among corn, wheat and soybean growers. Traditional supports are more valuable to rice and cotton growers.
In discussing potential paths for farm policy, Peterson mentioned revenue-protection programs, which might be combined with disaster funds or crop insurance coverage, or a crafting of farm supports so benefits go to producers rather than landowners.
Price supports, estimated for $2.3 billion this year, and crop insurance are regarded as a benefit to producers while direct payments, worth $5 billion this year, are easily captured by landowners.
Nearly $12 billion is forecast in cash payments to farmers this fiscal year, the bulk of it in crop subsidy and land stewardship programs.
One of the ideas that the National Sustainable Agriculture Coalition (NASC) hopes will be a part of the discussion is an expanded "green payments" program, which would reward farmers for environmental stewardship instead of placing the incentives on overproduction. "In light of the increasing questions coming from within parts of the Agriculture Committee leadership about the commodity programs--especially direct payments," said Aimee Witteman, Executive Director of NSAC, "We think 2012 represents an important opportunity to make [the Conservation Stewardship Program] an even bolder program that shifts financial resources away from environmentally-destructive practices."
Michel Pollan, author of The Omnivore's Dilemma
again from the Huffington Post article
Daniel Imhoff, author of the book, Food Fight: The Citizen's Guide to a Food and Farm Bill, said long-term thinking on the Farm Bill should focus on "Getting Perennial by the Next Centennial." The idea would be to "[use] the 5-year farm bills to push land use from monocropping of annual feed grains to broad acreages of deep rooted perennial plants that sequester carbon, filter water, protect the soil, provide habitat, and can support fewer numbers of healthier grazing animals."
Imhoff also said that this Farm Bill should take a stance of "No Subsidization without Social Obligation." "We must put an end to commodity subsidy programs that simply encourage overproduction and insurance of cheap ingredients for industrial foods," he said. "What we subsidize should contribute to an all around healthier food system"
Michael Pollan, author of The Omnivore's Dilemma and frequent speaker on food issues, agrees. "[The] whole bill needs to be viewed through the lens of improving public health and, perhaps specifically, supporting the first lady's Let's Move initiative," he said. "In the same way bills in congress get "scored" by [the Congressional Budget Office] for their impact on the deficit, the [Farm Bill] should be scored on its various provisions likelihood of improving or damaging public health."
Roots of Change President Michael Dimock with translator Laura Roldán Salazar
Another major issue is funding the research needed to turn the tables on climate change and the other environmental byproducts of this food system. "The federal food and agriculture research budget and agenda need to be more robust and diversified," said Michael Dimock, President of the organization Roots of Change. He continued, saying that we need "agro-ecological and organic research that will allow us to scale up the work of Joel Salatin, Wes Jackson, and others that are showing farmers how to work with diversity [and] to break out of the industrial mindset that seeks to eliminate diversity."
It is still too early to tell how this dialog about the 2012 Farm Bill will turn out, but Aimee Witteman at NSAC has some advice. "Get to know your legislators and identify champions for your issues early on," she said. "Also, don't underestimate the freshmen. We had several first-year Congress members step up and champion issues like beginning farmers and organic agriculture, folks such as Rep Tim Walz (D-MN) and Kirsten Gillibrand (D-NY)," who was a Representative when the 2008 Farm Bill was written.
From the National Sustainable Agriculture Coalition
Contrary to the focus on subsidies, what is needed is a return to supply management and fair prices. The key role of supply management is to stabilize prices. Agriculture is inherently volatile, and a shortage of supply due to drought or other factors can cause prices to spike and hurt consumers as quickly as overproduction can cause prices to fall and hurt farmers. By managing the quantity of crops on the market, supply management helps eliminate the volatile price swings that can devastate farmers and consumers alike. Better yet, with a system of fair prices—in which farmers receive a price from the marketplace that at least covers their costs and agribusiness buyers pay the full cost of production for the commodities they buy—commodity-based subsidies would not even be needed.