The Administration’s Unfortunate Plan

October 3, 2011

The Administration is pushing a new plan that would injure one of the few sectors in our economy that is actually creating jobs and helping offset an otherwise gloomy fiscal situation.

As has happened in three of the last six years, rural America is being called upon to give more than its fair share in cuts to reduce the deficit and accommodate government spending elsewhere.  Specifically, the administration’s proposal would slash by $33 billion the farm policies now in place to help farmers and ranchers cope with weather disasters and global markets distorted by high foreign subsidies.

Attacks like this add to the incredible uncertainty that threatens to stall growth in the rural economy. Not only must producers contend with uncertainty brought about by taxes, trade, regulations, and other DC-driven issues, now they must wonder if they will have something as basic and critical as insurance for their crops.

Farmers and ranchers—and their lenders—have good reason to be worried.  This isn’t the first time agriculture has been used as a piggybank.

Farm policy has been cut $15 billion in recent years, making rural America and agriculture the only parts of our economy to sacrifice in the name of deficit reduction.  Considering farm policy represents a paltry one-quarter of 1 percent of the Federal budget, that’s shameful.

It is no wonder then that rural lawmakers of all political stripes quickly dismissed the Administration’s plan as an attack on rural America and the men and women who put food on our tables, clothes on our backs, and fuel in our cars.

U.S. Representative Frank Lucas (R-OK), Chairman of the House Agriculture Committee, and U.S. Senator Pat Roberts (R-KS), Ranking Member of the Senate Agriculture Committee, were first to respond, saying that although agriculture has and will continue to do our part to help balance the budget, “The President’s policy priorities reveal a lack of knowledge of production agriculture and fail to recognize how wholesale changes to farm policy would impact the people who feed us.”

“For example,” they said, “cutting $8 billion from the crop insurance program puts the entire program at risk.  We have heard again and again from producers that crop insurance is the best risk management tool available.  In jeopardizing this program, the President turns a deaf ear to America’s farmers.”

Senator John Thune (R-SD) agreed and stressed the importance that agricultural budget-cutting decisions should be left to those who understand how each program works, urging that the cuts “can’t be tilted and weighted too heavily against our farmers.”

But it’s not just Republicans who are concerned about the future of agriculture.  Top Democrats are complaining, too.

Senate Agriculture Committee Chairwoman Debbie Stabenow (D-MI) reiterated the view of Roberts and Lucas in a recent statement.

“Agriculture will do its fair share in helping to reduce the deficit, but as I’ve always said, decisions on where those cuts come from should be made by the Agriculture Committee, where we constantly receive input from farmers and others in the agriculture community,” she said.  “Farmers across the country have made it very clear that maintaining crop insurance and responsible risk management tools are critical, especially as droughts, floods, and devastating storms have battered farms across the country.”

Senator Mark Pryor (D-AR) was even more blunt during his weekly conference call with reporters.

“Rural America is going to take it on the chin, and that is what you see with the Obama plan,” Pryor said.

Saying that rural America was under attack from all sides, Pryor blasted the proposed cuts, noting that the agricultural community has already made sacrifices in earlier efforts to reduce federal spending.

Rep. Collin Peterson (MN), the top Democrat on the House Agriculture Committee, was likewise critical, especially when it comes to one component of farm policy, which he considers essential to rural America’s success.

“I’m very opposed to cutting more from crop insurance,” Rep. Collin Peterson (D-MN) said, explaining that a program this important cannot withstand cuts of that magnitude again, the way it did in 2008.

This seems to echo a conclusion reached by another well-known Democratic leader. “Crop insurance is a foundation of our farm safety net,” that leader said.

Ironically, this was a quote lifted directly from the White House plan to slash crop insurance and leave producers with little farm policy left the next time Mother Nature strikes or the bottom falls out of the market.