Path Home Shows 2012 Show Archive April 2012 Show 1217 Farm Subsidies - Farm Subsidies Still Needed

Farm Subsidies - Farm Subsidies Still Needed

This year federal lawmakers are scheduled to rewrite the Farm Bill which is a comprehensive piece of legislation that covers everything from the food we eat, to the water we drink, even the air we breathe.

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House Committee on Agriculture

Show Dates

Show 1217: Farm Subsidies - Farm Subsidies Still Needed

Air date: April 22, 2012

 

Transcript

ROB MCCLENDON:  WELL 2012 IS THE YEAR FEDERAL LAWMAKERS ARE SCHEDULED TO REWRITE A PIECE OF LEGISLATION THAT FEW MAY UNDERSTAND, BUT AFFECTS ALL OF US.  THE FARM BILL IS A COMPREHENSIVE PIECE OF LEGISLATION THAT COVERS EVERYTHING FROM THE FOOD WE EAT, TO THE WATER WE DRINK, EVEN THE AIR WE BREATH.  AND WHILE FARM SUBSIDIES ARE JUST A FRACTION OF THE TOTAL COST OF THE FARM BILL, IT IS THOSE DIRECT PAYMENTS TO FARMERS THAT ARE UNDER SCRUTINY ON CAPITOL HILL, AND HAS FARMERS HERE IN OKLAHOMA EXPECTING SOME BIG CHANGES.

ROB:  WELL CREATED DURING THE DUST BOWL DAYS BY PRESIDENT ROOSEVELT, FARM SUBSIDIES WERE A WAY TO SAVE THOUSANDS OF SMALL FARMERS ON THE BRINK OF DISASTER.  SINCE THEN, TENS OF BILLIONS OF DOLLARS HAS FLOWED INTO FARM COUNTRY TO CONTROL COMMODITY PRICES WHILE ALSO HELPING FARMERS THROUGH THE LEAN TIMES.

MIKE SPRADLING:  IN TRUTH, IT’S THE AMERICAN CONSUMER THAT IS SUBSIDIZED BY THE FACT OF WHAT AMERICAN FARMERS DO.

ROB:  MIKE SPRADLING IS PRESIDENT OF THE OKLAHOMA FARM BUREAU AND SAYS HE FULLY EXPECTS DIRECT PAYMENTS TO FARMERS TO BE ELIMINATED BY A CONGRESS LOOKING FOR WAYS TO TRIM FEDERAL SPENDING

SPRADLING:  IF WE ARE GOING TO LOSE AT LEAST 30 PERCENT OF OUR PAYMENTS, WE WANT TO BE CERTAIN THAT SHIFTS BACK TOWARD CROP INSURANCE OR SOME TYPE OF RISK MANAGEMENT FOR OUR FARMERS IN THIS COUNTRY.

ROB:  THAT’S BECAUSE FARMING BY ITS VERY NATURE IS A RISKY BUSINESS.  WHILE THIS YEAR’S WHEAT CROP LOOKS OUTSTANDING, YOU DON’T NEED A LONG MEMORY TO REMEMBER LAST YEAR’S OKLAHOMA WHEAT CROP WAS DEVESTATED BY DROUGHT; A COUPLE OF YEARS BEFORE THAT IT WAS HAIL; AND BEFORE THAT, FLOODING.

SPRADLING:  WE’VE GOT TO HAVE SOME SUPPORT THERE, A SAFETY NET, THAT KEEPS THESE FARMERS IN BUSINESS, FOR THE CONSUMERS’ PROTECTION.

ROB:  BUT THE CHAIRMAN OF THE HOUSE BUDGET COMMITTEE, PAUL RYAN, IS CALLING FOR REDUCTIONS, IN NOT JUST DIRECT PAYMENT SUBSIDIES BUT ALSO IN FEDERALLY SUBSIDIZED CROP INSURANCE.  AND IF THE FULL HOUSE AGREES WITH RYAN, THE AGRICULTURE COMMITTEE WILL BE REQUIRED TO WRITE A FARM BILL THAT MEETS THE GOAL OF 30 BILLION DOLLARS IN CUTS, OR ABOUT A 19 PERCENT REDUCTION.

FRANK LUCAS:  WE HAVE A FOURTEEN TRILLION DOLLAR NATIONAL DEBT.  WE’VE BEEN RUNNING NOW IN THE LAST FEW YEARS, ONE TRILLION DOLLAR A YEAR PLUS DEFICITS.  WE HAVE TO GET A GRIP ON SPENDING; WE ABSOLUTELY DO.  AND EVERYTHING’S ON THE TABLE.  WHAT I HAVE SAID REPEATEDLY HERE IN THE NATION’S CAPITOL IS, TO LEADERSHIP, TO THE BUDGET COMMITTEE, TO THE SENATORS, TO THE WHITE HOUSE, ANYONE WHO’LL LISTEN, TELL US WHAT KIND OF RESOURCES WE HAVE TO WORK WITH, GIVE US A DOLLAR NUMBER, AND THEN LET THE COMMITTEES OF JURISDICTION, IN THE HOUSE THAT’S THE AGRICULTURE COMMITTEE, LET US MAKE THE HARD DECISIONS.  WE’LL WORK TO GET RID OF ANY DUPLICATION THAT MAY BE THERE.  WE’LL WORK TO GET RID OF PROGRAMS THAT DON’T MAXIMIZE THE RETURN TO RURAL AMERICA AND TO THE CONSUMER.  WE’LL DO WHAT NEEDS TO BE DONE.  BUT LET THE FOLKS WHO UNDERSTAND FARMING AND RANCHING, LET THE FOLKS WHO UNDERSTAND RURAL AMERICA, AND THAT IS THE HOUSE AGRICULTURE COMMITTEE ON THIS SIDE OF THE BUILDING, LET US MAKE THE TOUGH DECISIONS.

ROB:  OKLAHOMA CONGRESSMAN FRANK LUCAS CHAIRS THE HOUSE AG COMMITTEE AND IS IN THE TOUGH POSITION OF WRITING A FARM BILL DURING AN ELECTION YEAR THAT COULD MAKE NO ONE HAPPY.

FRANK LUCAS:  THE ECONOMY GETS TIGHT.  YOU MIGHT NOT DRIVE THAT EXTRA MILE IN YOUR AUTOMOBILE.  THE ECONOMY GETS TIGHT.  YOU MIGHT NOT BUY THAT EXTRA WIDGET.  YOU MIGHT NOT SPEND THAT EXTRA WHATEVER AT THE ENTERTAINMENT.  YOU MIGHT STAY HOME.  BUT YOU NEED SO MANY CALORIES A DAY.  YOU NEED ENOUGH HEALTHY AND NUTRITIOUS AND SAFE FOOD TO EXIST.  THIS IS THE COMMITTEE THAT DRIVES THE POLICIES THAT MAKE THAT POSSIBLE.

ROB:  AND WITH A  PROJECTED COST OF 4 HUNDRED AND 80  BILLION DOLLARS BEFORE CUTS,  SOME LAWMAKERS QUESTION WHETHER WE CAN AFFORD TO CONTINUE TO FUND A FARM  BILL THAT SUPPORTS AN INDUSTRY THAT’S REAPED RECORD PROFITS IN RECENT YEARS.  YET THOSE IN FARM COUNTRY SAY.

JODY CAMPICHE:  ARE WE SURE THAT WE CAN AFFORD NOT TO DOT IT?

ROB:  JODY CAMPICHE IS A PUBLIC POLICY SPECIALIST FOR OKLAHOMA STATE UNIVERSITY AND SAYS THE FARM BILL TYPICALLY COMES IN AT LESS THAN TWO PERCENT OF THE TOTAL FEDERAL BUDGET, WITH THE VAST MAJORITY OF THE MONEY GOING TO NON-FARM SPENDING.

JODY CAMPICHE:  IN THE FARM BILL, ABOUT 70 PERCENT OF FARM BILL SPENDING ACTUALLLY GOES TO FOOD AND NUTRITION PROGRAMS.  THESE PROGRAMS INCLUDE, LIKE THE FOOD STAMP PROGRAM WHICH IS NOW CALLED THE SNAP PROGRAM; THE WIC PROGRAM, WOMEN, INFANTS AND CHILDREN; SCHOOL LUNCH PROGRAMS; SCHOOL BREAKFAST PROGRAMS.  SO A VERY LARGE PORTION GOES, YOU KNOW, TO HELP FEED THOSE WHO NEED IT.  AND ABOUT 15 PERCENT OF FARM BILL SPENDING ACTUALLY GOES TO, DIRECTLY TOWARD COMMODITY PROGRAMS; SO THOSE WOULD BE THE COMMODITY PAYMENTS, PRICE AND INCOME SUPPORTS.  ABOUT EIGHT PERCENT GOES TO CROP INSURANCE PROGRAMS.  AND ABOUT ANOTHER EIGHT PERCENT GOES TO CONSERVATION PROGRAMS.

ROB:  AND WHILE ACTUAL FARM PAYMENTS MAKE UP A SMALL PART OF THE FARM BILL’S COSTS, OKLAHOMA COTTON GROWER, MATT MUELLER, SAYS THEIR BENEFITS GO WELL BEYOND HIS FARM.

MATT MUELLER:  I DON’T THINK THE GENERAL PUBLIC UNDERSTANDS THE AMOUNT OF MONEY THAT WE GO THROUGH.  I’M A 1200-ACRE FARMER; THAT IS SMALL FOR MY COUNTY.  AND AS FAR AS MONEY I’LL GO THROUGH, YOU KNOW, I’LL GO GET A LOAN FOR 300,000 AT THE BANK TO PUT A CROP IN.  WE GO THROUGH TENS OF THOUSANDS OF DOLLARS JUST TO PAY FOR OUR EQUIPMENT, AND OUR FUEL, AND OUR LABOR, AND OUR CHEMICAL AND SEED.  WE HANDLE A LOT OF MONEY AND MAKE A VERY SMALL MARGIN ON IT.  AND SO THAT’S WHY WHEN YOU TALK BIG NUMBERS, IT DOESN’T NECESSARILY TRANSLATE INTO A BIG PROFIT TOWARDS US.

ROB:  STILL OKLAHOMA PRODUCERS RECEIVED ABOUT 3-POINT-4 BILLION DOLLARS IN FEDERAL FARM SUPPORT OVER A TEN-YEAR PERIOD, WITH THE LARGEST 10 PERCENT OF THE PRODUCERS RECEIVING ABOUT 70 PERCENT OF ALL THE BENEFITS.  MONEY FARMERS, LIKE MUELLER, DEFEND AS AN INVESTMENT IN ENTIRE COMMUNITIES.

MATT:  THE SUBSIDIES WE RECEIVE ARE BASICALLY PASSED ON THROUGHOUT THE ECONOMY, SO WE CAN GO BUY JOHN DEERE TRACTORS, SO THE GUY WHO MADE THE JOHN DEERE TRACTOR MAKING UNION WAGES CAN KEEP HIS JOB,  SO THAT WE CAN BUY OUR CHEMICALS THAT KEEP MONSANTO, AND THE INVESTORS IN MONSANTO AND THOSE COMPANIES INVOLVED.  WE BASICALLY TAKE THAT MONEY AND PUT IN BACK OUT IN THE ECONOMY.  AND IF YOU TAKE THE LEGS OUT FROM UNDER AGRICULTURE, IF WE DON’T HAVE A SAFETY NET TO OPERATE WITH, AND THEREFORE WE’RE NOT, WE CAN’T STAY IN BUSINESS, THERE IS GOING TO BE A LOT OF THE AMERICAN INDUSTRY AND BUSINESS THAT IS GOING TO TAKE A HIT AS WELL, BECAUSE WE ADD TREMENDOUSLY TO MANUFACTURING JOBS AND SUPPORT JOBS.

ROB:  MAKING THE DEBATE THIS FALL OVER THE FARM BILL, NOT, JUST ABOUT THE FARM.  NOW THE GOVERNMENT NOW PAYS 60% OF THE PREMIUM FOR CROP INSURANCE, AS WELL AS UNDERWRITING INSURERS' OPERATING COSTS AND SHARING THE BURDEN OF PAYMENTS TO FARMERS IN HIGH-LOSS YEARS.  BUT UNDER THE RYAN BUDGET BILL, THE GOVERNMENT WOULD ONLY SUBSIDIZE 40% OF FARMERS’ CROP INSURANCE PREMIUMS, AT A SAVINGS OF ABOUT ONE BILLION DOLLARS A YEAR FOR TAXPAYERS.  ALSO, UNDER THE RYAN PLAN, FOOD STAMPS, WHICH HELP POOR PEOPLE BUY FOOD AND ACCOUNT FOR THREE-QUARTERS OF FARM-BILL SPENDING WOULD BECOME A BLOCK GRANT TO STATES.  ACCESS WOULD THEN BE LIMITED AND TIED TO WORK OR JOB TRAINING.  AND AS YOU MAY HAVE GUESSED, THERE IS STRONG OPPOSITION TO BOTH PROVISIONS BY DIFFERENT CONSTITUENCIES ON CAPITOL HILL; WHICH MANY BELIEVE MAKES AN AGREEMENT ON A NEW FARM BILL IN THE MIDST OF AN ELECTION YEAR, NEARLY IMPOSSIBLE.  WHEN WE RETURN A CONVERSATION WITH AN ECONOMIST WHO SAYS, IF IT SEEMS LIKE WE HAVE BEEN HERE BEFORE, IT’S BECAUSE WE HAVE.