On February 3, 2014, the Senate followed the House’s lead and voted 72-22 in favor of the conference report to accompany H.R. 2642, the Federal Agriculture Reform and Risk Management Act of 2013, more commonly known as the Farm Bill.  In passing the legislation, Congress is sending to the President a bill that is both a disaster for taxpayers and likely to be even more expensive and wasteful than the abysmal 2008 Farm Bill that it is replacing.

The Congressional Budget Office (CBO) estimates that the conference agreement will save a measly $16.6 billion over 10 years compared to a $956 billion cost of the legislation over the same timeframe.  The cost of the 2014 Farm Bill is 49 percent greater than the projected 10-year $640 billion cost of the 2008 Farm Bill.

CBO has a long history of underestimating how expensive farm bills will be, which makes it unlikely that even the miniscule $16.6 billion savings will be achieved.  According to an analysis by Taxpayers for Common Sense, CBO underestimated the cost of the last two farm bills (2002 and 2008) by a cumulative total of $450 billion.  Since CBO has not adjusted its scoring methods, there is little reason to believe that any of the projected savings for the 2014 Farm Bill will materialize.

The Farm Bill agreement makes a few welcome changes to the current law, such as an $8 billion reduction in the Supplemental Nutrition Assistance Program (SNAP), consolidation of several conservation programs within the Department of Agriculture (USDA), and the elimination of direct payments.  Changes to SNAP include increasing the amount paid by states for a heating assistance requirement and the closing of loopholes that allowed illegal immigrants, lottery winners, college students, and the dead to receive food stamps.

Unfortunately, these changes are not even a drop in the bucket compared to the myriad problems that permeate the bill.  Even though direct payments were repealed, the conference agreement expanded crop insurance for farmers.  According to a January 28, 2014 article in The Washington Post, “For decades, farmers have been able to buy federally-subsidized crop insurance in case their crops fail or prices decline.  But under the new farm bill, the government would also spend an additional $7 billion over 10 years covering the deductibles that farmers have to pay before the insurance kicks in.  This is supposed to help cushion the blow from the loss of direct payments.”

Although the idea of helping to “cushion the blow” from the loss of direct payments sounds altruistic, when the payments were in effect, large agribusinesses and rich individual farmers received a disproportionately large percentage of the subsidies.  According to a July 19, 2013 article in The New York Times, payments were delivered to “…wealthy absentee ‘farmers’ in places like Manhattan-- including over $340,000 to a Rockefeller scion, Mark F. Rockefeller, The New York Post reported earlier this year — who owned land that grew nothing.”

 In blatant disregard of bipartisan support in the House and Senate to means test crop insurance subsidies, the conferees did not include that provision.  Furthermore, provisions to repeal the duplicative catfish inspection program disappeared and caps on payments under the shallow loss program and marketing loan program were substantially increased.  In addition, the conference report retains the market-distorting sugar program without any changes and fails to reduce the size and scope of the Market Access Program, a corporate welfare stalwart.

While taxpayers dodged a bullet by avoiding the inclusion of the Dairy Market Stabilization Program, the conference agreement created a new dairy product donation program, which was never considered in the House or Senate.  The program would require the Department of Agriculture to buy dairy goods when market prices drop below a certain threshold and continue these purchases until market prices resurfaced above the established threshold.  

In a reversal of the logical separation of commodity and nutrition programs agreed to in the House last year, the conference report retains both titles combined on the same authorization schedule.  In doing so, this Farm Bill will perpetuate the expensive alliance between urban and rural special interests that have pushed through past Farm Bills and continue to permit the process to be a free-for-all farce.

The conference report is a disingenuous blow to serious-minded reformers of anti-competitive agricultural policies and tramples the interests of taxpayers and consumers by retaining the status quo or creating more egregious alternatives.  Unfortunately for everyone but the narrow agriculture interests that crafted this bill, the policies will be in place for at least the next five years.

  -- P.J. Austin