Farmers win on Election Year

Less than two years ago, Congress seemingly ended a decades-old practice of rushing to the rescue of farmers any time they suffered weather damage to their crops. The costly old system of “emergency aid” was a regular drain on the budget, and there were so many loopholes that some farmers with no appreciable losses were able to cash in.

But some habits are hard to break.  The Senate this week is on the verge of bypassing new procedures set up by the 2008 U.S. Farm Bill in order to bestow $1.1 billion of  emergency aid on farmers as part of a huge package of renewed tax provisions and a one-year extension of unemployment insurance. Also tucked into the legislation is nearly $350 million to help ranchers, fruit and vegetable producers, catfish farmers hit with high feed costs, and poultry raisers left high and dry by the closing of southern chicken processing plants.

For the legislation’s main champion, Senate Agriculture Committee Chairman Blanche Lincoln, D-Ark., obtaining the farm aid for Mississippi Delta cotton and soybean growers hurt by last fall’s heavy rains is a crucial step in an uphill battle to retain her seat in November.

Lincoln has been sharply criticized by conservatives for allowing health care legislation to proceed in the Senate, and has been hurt by a groundswell of anti-government feelings throughout her state.  Polls show her trailing several Republicans, and she is now also being challenged in the May 18 Democratic primary by Lt. Gov. Bill Halter, who is being backed by liberal groups who are displeased with her close ties to corporate agriculture and her stands on health care, union rules and global warming.

Lincoln ascended to chairmanship of the Agriculture Committee late last September, and since then has been pressing Senate Majority Leader Harry Reid, D-Nev., and other Democratic leaders to help her pass emergency assistance for farmers in her region.  An aide to Reid confirmed Monday that emergency agriculture assistance was included in the $138 billion package of tax extenders and unemployment insurance provisions awaiting action in the Senate.

But how Congress handles the farm aid issue will be a test of both parties’ commitment to control spending.

That’s because the 2008 farm bill was supposed to end such ad hoc payouts and replace them with a permanent — and less politically driven — system.

The farm bill set up a $3.8 billion trust fund, financed out of customs duties rather than appropriated funds. Last December, the Department of Agriculture followed up by announcing stringent eligibility standards that required farms to demonstrate substantial losses not just on one crop but across their entire farming operation. The new Supplemental Revenue Assistance Payment Program (SURE) closed significant  loopholes that had been part of emergency farm aid spending measures enacted by Congress. And it requires farmers to have purchased their own private crop insurance — providing incentives to growers not to rely on government alone to manage risks

Senate Budget Committee Chairman Kent Conrad, D-N.D., a principal architect of the program, hailed SURE as a better solution to the more expensive disaster bills common in Congress.

But the current push for special one-time aid — coming before a single dollar has been paid out by SURE — is being driven by strong political pressures and, less obviously, by striking differences in the ways farmers in different regions of the country cope with risk.     

“Arkansas’ farmers are the backbone of our state’s economy,” Lincoln said last week of the emergency assistance. “This will provide the helping hand they need to get back on their feet and save jobs.”

Theo Eldridge, director of the Farm Service Agency in Phillips County, Ark., in the Mississippi Delta, estimates 30 percent of the local soybean and cotton crop was lost due to record rainfall at harvest time. But that tells only part of the story because rice — a major local crop and the second largest after soybeans in the state — did not have significant losses, Eldridge said.       

Although Republicans and Tea Party activists are targeting Democrats for their free spending ways, Lincoln has political cover on farm aid because her legislation is co-sponsored by Sen. Thad Cochran , R-Miss., the top Republican on the Appropriations Committee.

Even so, after a year of record outlays, Democratic leaders are under enormous pressure to show fiscal restraint. That could involve standing up to the powerful farm bloc, something few in either party have been willing to do.

http://www.thefiscaltimes.com/Issues/Budget-Impact/2010/03/08/Farmer-Could-Reap-Big-Subsidies.aspx

Side note (with political map):

Few Democratic Governors Are Safe

"There are states where we didn't think we could play, say, two months ago, that now we think we can play in," says Tim Murtaugh, spokesman for the Republican Governors Association. "I don't think it has anything to do with Obama's personality as much as it has to do with his policies."

With 37 governorships up for grabs this year — including 23 left open by term limits or retirement — that likely translates into bad news for the Democrats.

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