Budget plan includes fix for farm bill extension fiasco

Fiscal package proposes to correct the disastrous farm bill extension measure agreed to by the White House and Senate Minority Leader behind closed doors.

The fiscal package announced by Senate Majority Leader Harry Reid (D-Nev.) proposes to correct the disastrous farm bill extension measure agreed to by the White House and Senate Minority Leader behind closed doors at the end of last year as part of the New Year fiscal cliff deal.

The farm bill component of the new “American Family Economic Protection Act” proposal is part of a larger package of spending cuts and revenue increases proposed as an alternative to the meat ax approach to deficit reduction known as sequestration.

The Reid proposal would end direct payments and restore the farm bill programs that were left out of the farm bill extension portion of the fiscal cliff deal.  Those programs – for renewable energy, rural small businesses, value-added agriculture, new and beginning farmers, conservation, specialty crops, organic farming, minority farmers, and local food producers – were all thrown under the bus in the fiscal cliff deal in order to preserve every last dollar of unneeded, untargeted, and antiquated direct subsidies.  The Reid proposal would right that wrong.  It would also provide immediate funding for livestock disaster assistance, another item left out of the fiscal cliff deal.

“We applaud Senator Reid for proposing to fix the fiscally irresponsible and unfair farm bill extension that was slapped together behind closed doors at the end of 2012,” said Ferd Hoefner, NSAC Policy Director.  “The package outlined today is a first step toward restoring both a sane fiscal policy and a fair farm bill extension.  With that in mind, the sustainable agriculture community calls on House, Senate, and White House leaders to work immediately toward a deal that averts or substantially modifies the sequester and corrects the farm bill extension so that it actually extends the full farm bill while beginning the long overdue job of reforming subsidies.”

The Reid bill would cut defense spending and net farm bill spending each by $27.5 billion over the coming decade.  The total elimination of direct commodity production subsidies yields $31 billion, but the bill also reinvests $3.5 billion to pay for a full farm bill extension, including the programs left stranded by the earlier partial farm bill extension plus disaster assistance.  It would also raise an additional $55 billion by closing two tax dodges and placing a minimum tax on millionaires to counteract the effect of tax loopholes, to raise an additional $55 billion.  The automatic budget cuts known as sequestration would be delayed until January 2014, in hopes that in the meantime a larger long-term deficit reduction deal could be reached by Congress and the White House.

Without new action by Congress, sequestration goes into effect on March 1, cutting farm commodity and conservation programs by some $7 billion and reducing every USDA discretionary program by five percent.

For background and the anti-reform farm bill extension included in the fiscal cliff deal, see this previous NSAC press release.

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