Just as a new budget pact was gaining ground, opposition to cuts that would impact agriculture are growing louder. In an effort to save the government money, the deal slashes spending on crop insurance by nearly a third, or roughly $3 billion, implemented over the next 10 years.
According to the Des Moines Register in an article here, top members of the House and Senate Agriculture committees announced their outrage at the deal, saying they weren’t notified of the cut before the deal with struck. Lawmakers from agricultural states united to voice their opposition.
- Senator Pat Roberts, R-Kan., Senate Ag Committee Chairman: “Farmers and ranchers have done more than their fair share to reduce government spending. To target the number one priority for producers with additional cuts will undermine the delivery of this important protection for agriculture. While Congressional leaders may sell this package as providing budget stability, it is anything but stable for farmers and ranchers. It took years to negotiate and pass a new Farm Bill. Producers have signed contracts and purchased policies. These proposals to make further cuts to the crop insurance program were not included in the House or Senate passed budgets, in any appropriations bills or in the President’s budget request. Once again, our leaders are attempting to govern by backroom deals where the devil is in the details. I will continue to oppose any attempts to cut crop insurance funding or to change crop insurance program policies.”
- Senator Joni Ernst, R-Iowa: "We just went through this several years ago with the Farm Bill. Cuts were made to crop insurance at that time. Now, we're facing another three $3 billion in cuts. The very concerning issue is that the agricultural committee--those of us that serve on this committee-were not even consulted about this particular cut. I don't think this is what Iowans want. I don't think this what Americans want. They want us to get rid of the reckless spending in Washington, D.C. Instead of addressing the core issues that we are facing with that overwhelming debt, we continue to spend more money. So, I'm very disappointed in this deal. I probably will not be supporting this deal."
- Senator John Hoeven, R-N.D.: “As a member of the agriculture committee and conferee on the bicameral panel that worked hard to negotiate the final version of the farm bill, I do not believe it is fair to the nation’s farmers and ranchers to go back and require an additional $3 billion reduction in crop insurance after we’ve already reduced spending by $23 billion in the farm bill. Based on what I have seen of the debt ceiling and budget agreement announced today, I believe we should do more to reduce the deficit and debt with both long-term savings and economic growth. Ironically, this budget deal takes more out of crop insurance, which has already been reduced by $12 billion since 2008. That’s not the right approach.”
- Rep. Mike Conaway, R-Texas, House Agriculture Committee Chairman: "As chairman of the Ag Committee, I got to protect the integrity of the farm bill. The overall impact is to flush insurance companies out of business, which I think is the President's intent."
Rep. Pete Sessions of Texas, chairman of the powerful Rules Committee, told CNN he was “seriously” weighing opposing the deal.
"Agriculture, agriculture, agriculture are my problems," Sessions said.
Earlier this week, agricultural groups began to release statements in reaction to the deal. Groups like the National Corn Growers Association opposed the cuts, calling the move “bad policy.”
“The 2014 farm bill provides farmers with a critical safety net, the cornerstone of which is the federal crop insurance program,” NCGA President Chip Bowling said. “Cuts to the crop insurance program will lead to fewer insurance providers and agents, and that means fewer choices for farmers to manage their risk.”
Traci Bruckner, Senior Policy Associate at the Center for Rural Affairs, offered a different perspective. She praised the deal a “small but positive step forward.”
“This bill takes a small step in reforming federally subsidized crop insurance programs by reducing the cap on the profits that crop insurance companies extract from administering the program from 14.5 percent to 8.9 percent,” said Bruckner in a press release here. “In addition, it also indicates that the Standard Reinsurance Agreement must be renegotiated by December 31, 2016 and once every five years thereafter.”
She added, “Insurance companies have been one of the largest beneficiaries of the subsidized crop insurance program. They witnessed double digit returns over the last decade or more, with one year being as high as 34%. During belt-tightening times, it is most appropriate to ask crop insurance companies to accept a reduction in the profits from federal subsidies that they receive.”