10/21/05 Reconciling the Senate budget

There were some concerns expressed by several ag related groups and supporters after the Senate Agriculture Committee narrowly passed a budget reconciliation package. That package contains around three billion dollars in cuts to ag programs, part of an overall goal of cutting almost $35 billion dollars from the fiscal year 2006 federal budget. The most contentious debate centered on the Milk Income Loss Contract program. The program designed to help milk producers in times of low price markets was allowed to expire earlier this month. However, Senate Ag Chair Saxby Chambliss of Georgia managed to convince enough Committee members to extend the M.I.L.C. program for another two years at the tune of $1 billion dollars. That was opposed by Idaho Senator Mike Crapo, who introduced an amendment designed to kill the M.I.L.C. program. The reasons he cited for his amendment were his beliefs that the M.I.L.C. program was price distorting and encouraged over production, that the measure should be debated later  say when considering the proposed 2007 Farm Bill and most important to Crapo & CRAPO: The fact that the reauthorization comes at the expense of commodity, conservation, and research in the agriculture programs is I think a very strong reason we should support this amendment. Under the Chambliss measure, $1.1 billion dollars would be cut from commodity programs, and another $1.3 billion would be cut from conservation programs. Examples include a 2.5 per cent cut over the next five years in all farm payment programs, limits to the acreage cap for the Conservation Reserve Program, limits to expenditures for both the E.Q.I.P. and C.S.P. programs, and the institution of a forfeiture penalty for non-recourse sugar loans. The federal Food Stamp program was also under consideration for cuts, about $574 million dollars worth, until Chambliss pulled that proposal off the table under threats his overall reconciliation measure would not pass the Senate Ag Committee. So what has been the reaction? First, many farm groups say while the cuts may be needed, where has been a contentious point of debate, almost a not in my backyard mind set. Second, the proposed cuts are not helping producers who are currently stuck with high fuel and fertilizer costs, and no way to recover those increasing inputs. And a third point offered by National Farmers Union member Robert Carlson is with the critical World Trade Organization negotiations on ag trade reform going on, this is not the time to cut farm payment programs. CARLSON: We ought to be putting them as high as we can so we can have leverage in those talks to reduce some of the export subsidies that some other country's notably the Europeans are using.