By Erik Wasson - 10/19/11 08:51 PM EDT
Three major farm associations on Wednesday weighed in with specific recommendations on how to replace the current system of direct farm payments should Congress move to cut farm subsidies this year.
The American Soybean Association, National Corn Growers Association and National Farmers Union support a “revenue-based risk management program” that would cover losses due to low yields. The associations are urging Congress to adopt the new system while keeping traditional crop insurance.
The deficit supercommittee is actively weighing scaling back farm subsidies and direct payments, which are granted even when a farm no longer produces crops, have been given extra scrutiny. It may include cuts in its November report, leading to action on farm programs well ahead of deliberations on the five-year Farm Bill slated for next year.
The chairmen and ranking members of the agriculture committees last week urged the supercommitee to cut no more than $23 billion over ten years from all farm programs, including nutrition programs that do not involve farm subsidies.
“We had anticipated working with your Committees to develop new farm legislation prior to the expiration of the 2008 Farm Bill next year. However, the realities of the current federal budget and debt crises, underscored by the decision by your Committee leadership to recommend a $23 billion reduction in farm bill spending as agriculture’s contribution to deficit reduction under the Budget Control Act, make it imperative to find a viable risk management approach that can replace several existing programs, including Direct Payments, Countercyclical Payments, SURE, and the ACRE program,” the letter states.
It goes on to state that the groups “will support modifications that reduce spending while maintaining as much revenue support as possible to protect against yield and multi-year price declines.”
Sen. Debbie Stabenow (D-Mich.), Sen. Pat Roberts (R-Kan.), Rep Frank Lucas (R-Okla.) and Rep. Collin Peterson (D-Minn.) plan to make their own more detailed recommendations to the supercommittee by Nov. 1.