Fresh Produce Discussion Blog

Created by The Packer's National Editor Tom Karst

Thursday, June 7, 2007

Markup session of hort subcommittee

Just listened to the farm bill markup session by the House Agriculture subcommittee on horticulture and organic agriculture. There were some amendments offered, but nothing that would dip into mandatory funding. In fact, subcommittee chair Dennis Cardoza, D-Calif., was even asked about the expense to the agency of an amendment he offered that simply wanted an internal research report on Section 32 food purchases.

From a House Ag Committee press release, here are amendments adopted:
. Chairman Cardoza's amendment to provide an independent evaluation of the USDA commodity purchasing process, particularly considering Section 32 and the importance of increasing purchases of specialty crops.
. Congresswoman Virginia Foxx's amendment to redirect funds for USDA to collect organic production and market data.
Congressman Kevin McCarthy's amendment to establish a Fresh Produce Education Initiative to inform industry and the public aboutfood safety handling and practices.
Congressman Randy Kuhl's amendment to establish the National Clean Plant network to fund the distribution of healthy plant stocksin the specialty crops industry.
Congressman Randy Kuhl's amendment to increase the payment limitation cap for payments under the Tree Assistance Program from$75,000 per year to $150,000 per year

As you might expect, Cardoza and other members of the subcommittee lamented the scoring problem and the resulting paltry funding scenario for specialty crop priorities for the farm bill. But Cardoza said, as a Blue Dog Democrat, he believes in the pay-go principle.

"Sometimes those principles we believe in come into conflict with what we would like to do (with legislation)," he said.

TK: Building expectations only to crash them is done quite a bit in Congress, Cardoza observed today. But he said he would raise expectations if in the process the level of debate also is raised. Now the question is, can the debate continue in Congress when expectations have been lowered so far?

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2 Comments:

At June 7, 2007 at 4:30:00 PM CDT , Anonymous Anonymous said...

As I work on the farm bill, I'm glad to be able to read this blog to get the specialty crops perspective. I really thought that specialty crops would get more in subcommittee, as they will be one of the key groups on the ag committee.
Dan Morgan did a great job analyzing the scoring issue over at farm policy:
http://www.farmpolicy.com/?p=317

His points are spot-on. The smaller baseline is a result of high grain prices, but if grain prices drop through the floor USDA will have to pay out according to the formula set by law. So if commodity prices go down, USDA will pay out the same big checks it did in the last five years, and the ag committee will almost certainly have to find at least some of that money from other USDA programs.

Which means cutting conservation, rural development and the like as has happened in the last five years, often to pay for ad hoc disaster assistance. And it could mean cutting whatever new specialty crop funding is found as well.

There are many people that have faith in farmers' ability to turn $4 corn into $2 corn.

The real difficulty for the ag committee is the baseline is forcing them to choose between programs. Because of that baseline, they are not free to rejigger commodity programs to create some illusory savings that could then be put into new programs. So they will be forced to decide which programs are the wisest use of their dollars (a shock, I know), and they can only do that in the full committee process that starts the week of June 25th. During subcommittee, they are not allowed to move money in between titles. So they couldn't move money to specialty crops from commodities at this stage. I would bet Cardoza is going to try and find money somewhere.

And that somewhere is a pretty small number of places if you're looking for big dollars. Dorgan-Grassley is now scored at 200 million/year (which is the real scoring shame, because it would be scored higher if commodity prices were low- and could end up saving much more than the score if grain prices go down).

Also, there is a great deal of talk about restructuring direct payments, which total about several billion dollars a year. Depending on how you do it, you could be talking as much as 1-2 billion/year. But the wheat and rice growers will fight that tooth and nail.

The other big source of dollars now being talked about is crop insurance. It costs $5 billion or so per year, has been criticized by the USDA inspector general and GAO, and somewhere around 40% of the money spent goes to the crop insurance companies, not farmers. I think this is why a crop insurance hearing was hastily schedule for today. But crop insurance is ridiculously complex, and the crop insurance companies are enormously politically powerful.

Anyway, a long comment on a good post.

 
At June 8, 2007 at 12:10:00 AM CDT , Blogger Tom Karst said...

Dan, Thanks for your insight andk links about budget realities. No doubt farmers will turn $4 corn into $2 corn, immediately if not sooner. For readers, Dan's blog, and a good post about the floor strategy for the farm bill is

http://www.cfra.org/blog/2007/05/11/floor-fight

Tom K

 

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