Currently browsing posts about: Farm-policy

Whoever at the National Sustainable Agriculture Coalition (NSAC) is doing the analysis and summaries of the farm bill deserves much praise for performing a major public service.

The Senate version of the bill under discussion right now is 1009 pages long and estimated to cost taxpayers $969 billion over the next ten years, of which nearly 80% goes for the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps).

The NSAC account deals with the big issues: the lack of conservation requirements attached to taxpayer subsidies for crop insurance, the enormous complexity of the bill, and the lack of an overriding vision of what the farm bill should do. 

In one sense, the Senate bill reflects not so much a new farm policy as a new, confusing, and costly set of options targeted at different segments of commodity agriculture…the emerging bill is a bundle of contradictions with respect to subsidy caps and conservation requirements…. This results from, among other things, the complete lack of clearly identified policy goals.…All of this would be complicated enough by itself, but as the headlines and hearings of the past several weeks amply demonstrate, before this farm bill is finished, it will very likely get more complicated still.

As I have said repeatedly, the farm bill is a vast collection of specific programs aimed at specific constituencies, each with its own lobbyists and congressional supporters.  It is so big and covers so many issues that nobody in Congress can possibly be expected to understand more than a tiny fraction of what is involved.  Hence: lobbyists.

I will leave consideration of the big issues to the NSAC analysts, and just focus on a few very small ones that caught my eye as an example of the absurdity of conducting farm policy through this mechanism.  The current Senate proposal:

Adds popcorn to covered commodities: Only some crops are eligible for federal support.  These include wheat, corn, grain sorghum,barley, oats, long grain rice, medium grain rice,pulse crops, soybeans, other oilseeds, and peanuts.  Now: “The Secretary shall study the feasibility of including popcorn as a covered commodity by 2014.”

Specifies use of fortified foods in international food aid: “adjust products and formulations,including potential introduction of new fortificants and products, as necessary to cost ffectively meet nutrient needs of target populations, to test prototypes;to adopt new specifications or improve existing specifications for micronutrient fortified food aid products.”

Calls for a report on honey: “Not later than 180 days after the date of enactment of this Act, the Secretary, in consultation with affected stakeholders, shall submit to the Commissioner of Food and Drugs a report describing how an appropriate Federal standard for the identity of honey would promotes honesty and fair dealing and would be in the interest of consumers, the honey industry, and United States agriculture.

Removes Canada geese from within five miles of airports, especially JFK: “by the first subsequent molting period for Canada geese that occurs after the date of enactment of this Act, publish a management plan that provides for the removal, by not later than 1 year after the date of publication, of all Canada geese residing on the applicable land.”

On the brighter side, it also:

Expands farmers’ market promotion to include local food: “domestic farmers’ markets, roadside stands, community-supported agriculture programs, agritourism activities, and other direct producer-to-consumer market opportunities; and local and regional food enterprises that are not direct producer-to-consumer markets but process, distribute, aggregate, store,and market locally or regionally produced food products.”

NASC’s assessment:

that may be, as the saying goes, the best that can be accomplished under current circumstances.  If so, one would hope that if nothing else, it would spur a major re-evaluation and thorough overhaul between now and the next farm bill to create something that might begin to approximate a goal-driven, fairer, less costly, more rationale, less environmentally damaging, more economic opportunity-creating, and less market distorting approach then where it appears the current process will end up. 

Hey—we all can dream.

This appeared in my e-mail.  I tried to find out where it came from, but no luck.  Can anyone tell me its source?

I haven’t said anything recently about the current status of the farm bill, mainly because it is too early in the political process to know what is going to happen.

On April 26, the Senate Ag Committee voted to pass the Agriculture Reform, Food and Jobs Act of 2012.

The bill still has a long way to go.  It must be passed by the Senate.  The House has to pass an equivalent bill.  The two bills must be reconciled.  The final bill must be signed by the President.

Otherwise, the current farm bill expires on September 30.

As is always the case with anything having to do with the farm bill, the devil is in the details.  The number of programs covered by the bill is vast, and the details even more so.

In efforts to align agricultural policy with health policy, the current proposal makes a little headway. The proposed bill funds:

• $150 million annually for the Fresh Fruit and Vegetable program
• $50 million per year for the Defense Department Fresh program, which provides fresh fruits and vegetables to schools and service institutions
• $70 million annually for the Specialty Crop Block Grant program
• $25 million annually for the Specialty Crop Research Initiative, to go to $50 million by 2017
• $60 million in 2013 up to $65 million 2017 for pest and disease management programs
• $200 million annually for The Market Access Program and $9 million for the Technical Assistance for Specialty Crops program
• $100 million over 5 years for the Hunger-Free Communities Grant Program for fruit and vegetable SNAP incentives
• $100 million over 5 years for the Farmers Market and Local Food Promotion Program
• $406 million annually for Section 32 specialty crop purchases

This looks like a lot—and from the standpoint of incremental change it is a lot—but these numbers are millions, not billions, and in farm bill terms can be considered “mere rounding errors.”

The farm bill currently costs taxpayers $85 billion a year, with $72 billion of that going for SNAP (food stamp) benefits.

The rest of the big money goes to the Big Agriculture growers of commodity crops, mainly in the form of crop insurance.

Here too, the proposed bill includes one small but significant measure.  For the first time, it provides for crop insurance for diversified farms—those that grow a variety of  “specialty” crops (translation: fruits and vegetables).

Even the most critical commentators think the current proposal, despite its evident flaws, represents the best that can be expected given current political realities.

Let’s hope the good parts of the proposal survive the rest of the legislative process.

Addition, May 24: A reader points out that another bright spot is that the Senate bill also included $125 million for the Healthy Food Financing Initiative.

According to an account in last week’s New York Times, the federal government could save about $1 billion a year by reducing the subsidies it pays to large farmers to cover much of the cost of their crop insurance.  Crop insurance subsidies are expected to cost $39 billion from 2012 to 2016, or about $7.8 billion a year.

The Times based this statement on a new report from the Government Accountability Office.  This report explains that the billion-a-year savings would occur if the government applied the same limits to subsidies for crop insurance as it applies to other farm support programs.

The report raised the prospect of the government’s capping the amount that farmers receive at $40,000 a year, much as the government caps payments in other farm programs. Any move to limit the subsidy, however, is likely to be opposed by rural lawmakers, who say the program provides a safety net for agriculture.

Get this:

Under the federal crop insurance program, farmers can buy insurance policies that cover poor yields, declines in prices or both. The insurance is obtained through private companies, but the federal government pays about 62 percent of the premiums, plus administrative expenses.

And that’s not all.  The Environmental Working Group says many of the crop insurers are foreign companies.

Twenty insurance companies in Bermuda, Japan, Switzerland, Australia, Canada and the U.S. were paid $7.1 billion in U.S. taxpayer funds from 2007 to 2011 to sell American farmers crop insurance policies, an Environmental Working Group analysis shows. The U.S. Department of Agriculture’s Risk Management Agency paid these companies for administrative and operating expenses for the federally subsidized crop insurance program.

We talked about crop insurance subsidies in the class on the farm bill that I taught at NYU last fall.   My class thought all of us should immediately go into the crop insurance business.  The government pays most of the premiums and administrative expenses and also covers most of the risk.  This is a really good deal for Big Ag and the lucky few insurance companies.

You find this difficult to believe?  Take a look at two of the readings for the course:

Shields DA.  Federal crop insurance: background and issues.  Congressional Research Service, December 13, 2010.

Insurance policies are sold and completely serviced through 16 approved private insurance companies. Independent insurance agents are paid sales commissions by the companies. The insurance companies’ losses are reinsured by USDA, and their administrative and operating costs are reimbursed by the federal government.

Smith VH.  Premium payments: why crop insurance costs too much.  American Enterprise Institute, 2011.

Since 2007, government subsidies for crop insurance have averaged about $5.6 billion per year, representing over one-third of total expenditures on income transfers and other government payments for programs targeted directly to farmers.

However, about 58 percent of those expenditures have ended up in the hands of agricultural insurance companies and agricultural insurance agents.

In fact, since 2005, on average, the agricultural insurance industry has received $1.44 for every dollar farmers have received in crop insurance subsidies.

No wonder Big Ag wants crop insurance subsidies continued.

Will the 2012 farm bill fix this?  I’m not optimistic but will stay tuned.

Sales of organic foods continue to increase at a faster pace than sales of conventional foods.  This alone makes people suspicious of the organic enterprise.

Another reason is confusion about what organic production methods are, exactly.  If you are part of the food movement, you probably want your foods to be organic, local, seasonal, and sustainable.  You might also want them produced by farm workers who have decent wages and living conditions.

Unfortunately, these things do not necessarily go together.

• Organic means crops grown without artificial pesticides, fertilizers, GMOs, irradiation, or sewage sludge, and animals raised without hormones or antibiotics.  Certified Organic methods follow specific rules established by USDA.
• Local means foods grown or raised within a given radius that can range from a few to hundreds of miles (you have to ask).
• Seasonal refers to food plants eaten when they are ripe (and not preserved or transported from where they were grown).
• Sustainable means—at least by some definitions—that the nutrients removed from the soil by growing plants are replenished without artificial inputs.

That these are different is illustrated by a recent article in the New York Times about industrial organic production in Mexico.  The story makes it clear that organics do not have to be local, seasonal, sustainable, or produced by well paid workers.

While the original organic ideal was to eat only local, seasonal produce, shoppers who buy their organics at supermarkets, from Whole Foods to Walmart, expect to find tomatoes in December and are very sensitive to price. Both factors stoke the demand for imports.

Few areas in the United States can farm organic produce in the winter without resorting to energy-guzzling hothouses. In addition, American labor costs are high. Day laborers who come to pick tomatoes in this part of Baja make about $10 a day, nearly twice the local minimum wage. Tomato pickers in Florida may earn $80 a day in high season.

The cost issues are critical.  Dairy farms in general, and organic dairy farms in particular, are entirely dependent on the cost of feed for their animals, and the cost of organic feed has become almost prohibitively expensive.  This has caused organic dairy producers to cut back on production or go out of business.  As another New York Times article explains,

The main reason for the shortage is that the cost of organic grain and hay to feed cows has gone up sharply while the price that farmers receive for their milk has not.

While the shortage may be frustrating for consumers, it reveals a bitter truth for organic dairy farmers, who say they simply need to be paid more for their milk.

Why is the price of feed rising?  Simple answer: because 40% of feed corn grown in the United States is being used to produce biofuels.

Why do farmers grow corn for biofuels?  Because the government gives them tax credits and other subsidies to do so.

But in a small step in the right direction, the ethanol tax credit program was allowed to expire last week,”ending an era in which the federal government provided more than $20 billion in subsidies for use of the product.”

One person quoted in the article connected the dots:

Production of ethanol, with its use of pesticides and fertilizer and heavy industrial machinery, causes soil erosion and air and water pollution. And it means that less land is available for growing food, so food prices go up.

Organics do not exist in isolation.  Their production is connected to every other aspect of the food system.

Wouldn’t it be nice to have a food system that promoted organic, local, seasonal, sustainable agriculture and paid farm workers a living wage?

Wouldn’t it be nice if the 2012 Farm Bill supported that kind of a food system if not instead of than at least along side of the one we have now?

I will be watching to see what Congress does with the Farm Bill.  Stay tuned.

Grist and Food and Tech Connect have excellent reports on last week’s Farm Bill Hackathon.  This event brought together farm bill experts and designers to try to produce materials that make farm bill issues accessible.

The terrific winning entry: A Clean Farm Bill of Health slideshow illustrating the contradiction between USDA dietary advice policy and that for farm supports.

I could not participate in the Hackathon but having just taught a class on the farm bill I know what I’d like to have: a complete text of the farm bill annotated to include all of the relevant information.

The 663-page 2008 farm bill is readily accessible online, but it is unreadable (by me at least).   This is because it refers to previous bills and other Acts of Congress, which in turn refer to previous bills and Acts, in some cases going back to 1933.

You don’t believe me?  Try this entirely typical section, chosen at random:

SEC. 12001. DEFINITION OF ORGANIC CROP.
Section 502(b) of the Federal Crop Insurance Act (7 U.S.C.
1502(b)) is amended—
(1) by redesignating paragraphs (7) and (8) as paragraphs
(8) and (9), respectively; and
(2) by inserting after paragraph (6) the following:
‘‘(7) ORGANIC CROP.—The term ‘organic crop’ means an
agricultural commodity that is organically produced consistent
with section 2103 of the Organic Foods Production Act of 1990
(7 U.S.C. 6502).’’.

It would be so nice to have a text that gives the relevant information in one place: what the Federal Crop Insurance Act says, what paragraphs 7 and 8 are all about, and what’s in section 2103 of the 1990 Act.

Hackers: anyone want to take this on?

My monthly (first Sunday) Food Matters column in the San Francisco Chronicle:

Q: What’s going on with the farm bill? Any chance for improving it?

A: I wish your question had an easier answer. The farm bill has to be American special-interest politics at its worst.

As Stacy Finz has been reporting in the main news and Business sections of The Chronicle, the failure of the recent super-deficit reduction plan also brought an end to a secret committee process for writing a new farm bill. Now Congress must follow its usual legislative procedures. The farm bill is again open for debate.

Advocacy is much in order. The farm bill is so enormous, covers so many programs, costs so much money and is so deeply irrational that no one brain – certainly not mine – can make sense of the whole thing.

It is all trees, no forest. The current bill, passed in 2008, is 663 pages of mind-numbing details about programs – hundreds of them – each with its own constituency and lobbyists.

The farm bill was designed originally to protect farmers against weather and other risks. But it grew piecemeal to include programs dealing with matters such as conservation, forestry, biofuels, organic production and international food aid.

The most controversial programs cover food commodities – corn, soybeans, wheat, rice, cotton, sugar and dairy – but lesser-known provisions support smaller industries such as honey or Hass avocados.

The elephant in the farm bill is SNAP, the Supplemental Nutrition Assistance Program (formerly food stamps). Fully 80 percent or more of farm bill expenditures go for SNAP.

This year, SNAP costs ran about $6 billion a month, and they are rising in today’s depressed economy. In contrast, commodity subsidies cost “only” about $8 billion a year. Crop insurance adds $4.5 billion, and conservation about $5 billion. Everything else runs in the millions, not billions, mere nothings in comparison to SNAP’s $70 billion 2011 expenditures.

SNAP judgements

What, you might ask, is SNAP doing in the farm bill? Think: logrolling.

Members of Congress who represent farm states need urban votes to pass subsidies. Urban members need farm votes to protect SNAP. This deal works, and both sides like the unsavory system just as it is.

As for irrationality: At a time when preventing obesity heads the public health agenda and reducing greenhouse gases is an international priority, the farm bill firmly protects the status quo.

It promotes production of commodities, but does little to link agricultural policy to policies that promote health or environmental protection. Although the Dietary Guidelines and MyPlate strongly promote consumption of fruits and vegetables, the farm bill inconsistently considers these foods as horticulture or specialty crops that do not merit subsidies or government-supported insurance. Indeed, many farm bill provisions discourage production of fruits and vegetables.

Overall, the farm bill must be seen as an inequitable means to protect the income of the largest and richest industrial producers of food commodities. It has little to do with serious efforts to protect conservation of natural resources, support rural communities or promote sustainable farming practices that maintain soil quality and mitigate climate change. Nor does it address the real needs of low-income communities.

The current bill favors large farms over small ones, intensive rather than sustainable production methods, and some states and regions over others. It actively promotes risk-taking; the government covers the costs.

It ignores food safety. It promotes production of inefficient biofuels. It does nothing to promote sustainable farming practices in this or any other country. And because it rewards farmers for overproducing commodities, it gets the United States in trouble with international trading partners.

Worst of all, the bill is inherently undemocratic. It is so opaque that nobody in Congress or anywhere else can possibly grasp its entirety. Its size and complexity make it especially vulnerable to influence by lobbyists for special interests and by the corporations most generous with campaign contributions.

Pro and con arguments

Its defenders argue that the present system works pretty well in ensuring productivity, global competitiveness and food security. Tinkering with it, they claim, will not make much difference and could do harm.

I disagree. It needs more than tinkering. Americans need farm policy to be brought into line with health and climate-change policy, and now is our chance.

Those of us who believe that food systems should be healthier for people and the planet have been handed an opportunity to rethink farm bill programs and to make the processes for its development more democratic.

Groups such as the Environmental Working Group ( www.ewg.org) and National Sustainable Agriculture Coalition (sustainableagriculture.net) have been hard at work on these issues. Join them, speak up, and get busy.

This article appeared on page G – 4 of the San Francisco Chronicle

Stephen Clapp, reporting Friday in Food Chemical News (subscription required, alas), had this to say about Congress’s failure to create and pass a farm bill in secret and without debate (see previous post):

The agriculture committees will now try to achieve an unprecedented feat — passing a Farm Bill in an election year. Even in the best of times, passing a Farm Bill is like “passing a kidney stone,” quipped Sen. Tom Harkin (D-Iowa) in 2008.