Today, the House passed the massive new Farm Bill with the Senate expected to pass this monstrosity in the next several days. After almost two years of hearings, negotiations and horse trading the current bill is almost the same as past bills. It’s good to be a farmer.
Let’s take a look at the current bill. The Farm Bill consists of two unequal components: food stamps and farm programs. Nearly 80% of the cost is devoted to food stamps. Early on the House split to two parts into separate bills but they didn’t stay divided for long.
Ranking member of the Senate Agriculture Committee Thad Cochran (R–MS) explained farm bill politics well when he argued that the farm bill includes food stamps “purely from a political perspective” since “it helps get the farm bill passed.”
The House wanted to cut food stamp spending by $39 billion over 10 years. The Senate bill would have reduced spending by $4 billion. It appears that the Senate’s big spenders won with a cut of a mere $8 billion in the current bill.
Within the food stamp portion of the bill any attempt at means-testing was removed. You could have a million dollars in the bank and still receive food stamps. To its credit, the House did close the loophole in its bill. Then, their negotiators folded when it came to the conference bill. If this loophole had been closed, taxpayers would have saved about $12 billion.
The Farm Bill has no work requirement for recipients. The work provision in the bill is nothing more than a mere work “suggestion.” A strong work requirement is the most crucial reform for food stamps, but Congress has failed to include such a policy.
Here’s where it gets really great to be a farmer. The current bill attempts to remove all of the risk from farming. The crop insurance portion of the bill was untouched with the American taxpayers paying 62% of the cost.
Even a minor reform in the Senate version that lowered the subsidy for farmers with adjusted gross income of $750,000 or more was removed. The new bill actually increases costs by about $6 billion.
Once again Big Sugar came through unscathed. Sugarcane and sugar beet processors can receive loans through the U.S. Department of Agriculture. They can pay back the loan, or they can just forfeit their sugar to the government instead. This gives them the ability to avoid paying off the loans if market prices fail to cover their costs. Nice work if you can get it.
Another part of the crop insurance program subjects the American taxpayers to near limitless liability. At one time there was a price ceiling on liabilities, limiting the exposure that taxpayers would have to pay out for these unknown and costly programs.
The new bill doesn’t appear to have such a cost cap—basically, taxpayers are faced with a blank check while farmers are being covered for virtually any risk.
The Department of Agriculture will also be establishing new federal standards for “the identity of honey.” Apparently even bees are helpless without the federal government.
Finally, two egregious programs were either left out of the Farm Bill. One was the repeal of the controversial and duplicative catfish inspection program that costs the taxpayers $14 million a year.
The other program that was included was the mandatory assessment (i.e. “tax”) on Christmas trees. It creates a National Christmas Tree Board, funded through a 15-cent tax on every Christmas tree sold.What’s next, taxing Santa Claus’ visits?