The Register's Editorial: Farm bill should benefit everyone

5-26-2013 Washington DC:

The farm bill that died in the last Congress has come back to life. It might actually pass this time.

Two versions of the bill being debated in the Senate and House cover a broad range of issues, from crop, milk and tobacco support programs to the cost of food stamps for the poor. Farm organizations, environmental groups and members of Congress with distinctly different agricultural constituencies are scrambling to get their pet issues dealt with in the legislation.

The differences between the House and Senate bills will be worked out in a joint conference committee, probably in August. That is when the real farm bill will be written, and congressional leaders should insist that the committee produce a bill in the best interest of the public, not just powerful agricultural commodity organizations.

For starters, Congress should end direct taxpayer subsidies that are paid to farmers regardless of whether they grow anything. The danger, however, is that any resulting savings to the treasury could be wiped out by federal crop insurance, which is the farmers’ preferred alternative because the government pays 60 percent of the premiums.

Federal crop insurance has become the fastest-growing federal farm program, because of the taxpayer premium subsidies and because farmers’ losses can be covered not just for weather-related disasters but for market-related price declines, too.

In fact, the cost of protecting against economic losses is driving up the cost of this program, according to a study by Iowa State University economist Bruce Babcock for the Environmental Working Group. Indeed, even in the record 2012 drought year, crop insurance payouts were related less to the drought than to a decline in market prices for commodities. ..continued.. by The Register’s Editorial Board