Politico: Farm Belt Braces for Budget Cuts
October 13, 2011

Politico reports:

Under pressure to cut farm subsidies, Agriculture Committee leaders in Congress are closing in on a 10-year savings target near $23 billion, about a third less than what House Republicans and President Barack Obama had proposed but still a significant change.

No final announcement has been made, but the bipartisan leadership met Tuesday evening, and three lawmakers told POLITICO that they expected the final savings to be in $23 billion range.

Upon returning to the Senate floor on Wednesday, Sen. Debbie Stabenow (D-Mich.), who chairs the Senate panel, huddled at length with Senate Budget Committee Chairman Kent Conrad (D-N.D.), a major force as well on farm policy.

Kansas Senator Pat Roberts is the ranking Republican on the Senate Ag panel. He and Stabenow have held hearings on the Farm Bill in various parts of the country, including Kansas.

Stabenow’s goal — together with House Agriculture Committee Chairman Frank Lucas (R-Okla.) — has been to come up with a single recommendation this week for the new joint debt committee, charged with putting together a $1.2 trillion deficit reduction package next month.

“Chairwoman Stabenow has been working closely with farmers, House committee leaders and members of her own committee to develop a bipartisan set of recommendations that both strengthen American agriculture and contribute to deficit reduction,” her spokesman said. “They are continuing to discuss options and determine a final agreement, and aim to send a letter to the Joint Committee by Friday outlining their recommendations.”

Indeed, the precise assumptions behind the $23 billion target could still be changed and are complex in their own right. But to achieve that level of savings almost certainly means the end of the current system of direct cash payments costing almost $5 billion annually.

With high crop prices and net farm income predicted to jump 31 percent this year, those payments have become hard to defend politically, since much of the money goes to households earning more than $100,000. But the agriculture committees have been anxious to retain some of the savings to help finance new forms of crop insurance to protect growers against a rapid drop in revenues.