MFU Public Radio Commentary

By Sandy Courtnage

May 6, 2008

Maybe We Have a Farm Bill . . . Maybe We Don’t

Maybe we have a farm bill . . . maybe we don’t.  That has been the situation for quite some time now. 

Just last Friday, the House and Senate passed its sixth extension to give themselves a couple more weeks to work out all the details of what has been called “the most difficult Farm Bill in the past 20 years.”

The challenges are many, and have been helped and hindered by strong leadership and opinions on both sides of the aisle, in both houses, and in the White House.  The conference committee has been working to find ways to build a good bill – one with broad support that either will be agreeable to the president or veto-proof.

There are still a few details to be worked out, but the reports out of Washington say they are close in their struggle to finish a bill that can survive a presidential veto. 

It’s not any time too soon because the real life ramifications of this bill are many.  Most farmers are either done or almost done with spring seeding – yet their bankers do not know what to expect from Washington.  With the cost of production skyrocketing, delays like this create significant cash-flow problems and extreme anxiety.

The rising cost of fuel and fertilizer, for example, add to that anxiety.  In fact, over the past seven years, diesel fuel prices have increased almost 250 percent per gallon and crude oil has increased 453 percent.  That really impacts a farmer’s ability to plant a crop and expect to see a profit at the end of the growing year. 

In addition, rising energy costs play a significant role in the increased cost of food.  With food traveling more than 1,500 miles before reaching the final consumer, gasoline prices that have increased 198 percent, greatly contribute to a rising grocery bill. 

We all know that the Farm Bill is not just about farmers.  In fact, the Farm Bill could more accurately be called a Food Bill – or a Food and Farm Bill. 

News of food shortages and food riots in a number of countries, emphasize that the situation is truly serious.  The Farm Bill is trying to address some of these problems.  The bill provides $400 billion for domestic and international food nutrition programs, which is about two-thirds of the total cost of the bill.  As it stands right now, the bill includes an increase in the standard income deduction for food stamp recipients, and the minimum food stamp benefit also will increase.  In addition, donations to food pantries will more than double.  These three nutrition elements also will be indexed for inflation, which is an important improvement.

Just last week the U.S. Congressional Joint Economic Committee held a hearing on how high food prices are impacting American families.  National Farmers Union President Tom Buis said the most significant reasons for retail food price increases include $120 per barrel for oil, the declining value of the American dollar, increased demand from developing countries, world-wide weather related production shortages, and speculation in the commodity markets.

His solutions to address the problem were four fold:

-         Halt deposits to the Strategic Petroleum Reserve;

-         Establish an International Humanitarian Food Reserve;

-         Impose an excessive profits tax on oil companies’ record profits; and

-         Support the Farm Bill’s passage.

So, do we have a Farm Bill?  Let’s hope so.  It’s not perfect, but we need to keep farmers and ranchers in business and do all that we can to ensure that no one goes to bed hungry.

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