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What will happen with Farm Bill in USA? Rural Americans do not have time for it

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The farm bill was the missing topic during a 45-minute session recently with farmers in southwestern Missouri, recalls Senator Roy Blunt. “The farm bill never came up.” Instead, growers talked about threats to farm exports, over-regulation, and the need for rural broadband. Agriculture Secretary Sonny Perdue says low commodity prices, the slump in farm income, attacks on corn ethanol, and, most of all, anxiety about a possible trade war are the top concerns in farm country.

Farm Bill 2018 USA
Farm Bill 2018 USA

“These things have overshadowed, in a farm bill year, discussion of the farm bill,” said Perdue during a dialogue with Blunt last week at a Senate hearing.

For the second time in a row, Congress is writing a farm bill with limited impetus from rural America. During the protracted drafting of the 2014 bill, the common explanation was that high farm income due to the commodity boom reduced the urgency of legislation. This time, the converse is one of the explanations: Farmers expect little help from a status quo farm bill during an economic slump, so there is little reason to get excited.

“Throw in all the other nonagriculture issues that command the attention of folks in D.C. and around the country, and the farm bill just doesn’t rise to the top of the concern lists of many people,” said Pat Westhoff, head of a University of Missouri think tank. As examples, Westhoff cited China’s threat of 25% tariffs on U.S. soybeans, corn, wheat, cotton, sorghum, beef, and orange juice; the regulatory tug-of-war over ethanol; and calls for regulatory relief.

There is plenty of competition for the attention of the farm sector. On the day that House Agriculture Chairman Michael Conaway unveiled his farm bill, President Trump announced support for year-round sales of a 15% blend of ethanol into gasoline and interest in joining the Trans-Pacific Partnership trade pact. Both are objectives of farm groups.

Former USDA chief economist Joe Glauber said there was little drama in the 2018 farm bill, partly because the White House is staying on the sidelines and there are no calls from farm country for an overhaul of the farm program. “So the action has all been in Congress,” he said. Lawmakers resolved cotton and dairy farmers’ complaints about inadequate support by providing additional subsidy money in the omnibus government funding bill in March. Those were welcome steps but took some air out of the farm bill balloon.

Farm Bill 2018 USA
Farm Bill 2018 USA

There is no additional money for major changes in grain and soybean subsidies in the farm bill. So the biggest change the farm bill can offer grain and soybean growers would be the chance to switch to the Price Loss Coverage program, which is constructed like traditional farm supports, from the insurance-like Agricultural Risk Coverage program. The PLC approach is more valuable during a period of low commodity prices.

Glauber said the traditional urban-rural alliance for passage of a farm bill is fraying, too. “Farm program proponents may need urban/suburban votes to get a farm bill passed but I don’t think the same is true for SNAP [supporters] since their programs don’t sunset after five years. Particularly, there is little in it for urban/suburban voters if the bill contains poison pills” on SNAP, he said.

Indirectly, the 1996 Freedom to Farm law, which removed most federal controls over what farmers plant, and the elevation of crop insurance in the 2014 farm law to first place among federal farm supports, may contribute to the waning of farm bill’s importance, say analysts. The free market, as intended, plays a bigger role in the farm economy than it did a quarter century ago. Crop insurance will remain in operation if the farm bill lapses.

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