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Extension of Farm Subsidies Rebuffed by Senate Democrats

U.S. Farming
Cuts to food stamps, as well as changes to crop insurance programs and other farm aid, have been stumbling blocks as lawmakers seek to resolve differences in Senate and House versions of a five-year reauthorization of agricultural programs. Photographer: Daniel Acker/Bloomberg

An extension of U.S. agriculture subsidies to late January was rebuffed yesterday by Senate Democrats, who said they won’t pass any House plan for temporary funding before Congress breaks for the holidays.

The Democrats called on the Republican-led House to keep working with them to hammer out longer-term legislation.

“We’re not going to do an extension,” Senate Agriculture Committee Chairwoman Debbie Stabenow, a Michigan Democrat, told reporters. “If the House leadership would just stay through next week, like the Senate is staying, we would actually be able to get” a new five-year farm-policy bill, she said.

House Agriculture Committee Chairman Frank Lucas, an Oklahoma Republican, proposed a bill to extend to Jan. 31 the farm law that expired two months ago. He will seek a vote on it in his chamber if lawmakers negotiating a five-year plan aren’t close to a deal by Dec. 13, the last day the House is scheduled to meet this year.

If Congress doesn’t act before year’s end, U.S. dairy support programs will revert to a 1949 statute that when fully implemented would double the wholesale price of milk.

The Agriculture Department hasn’t said when it could implement the law, which could take months. Lawmakers are reluctant to head home for the holidays to headlines about milk prices of $7-per-gallon in the new year.

“Our goal is still to come to an agreement that leads to a bill even if perhaps we can’t get it done in the House this calendar week,” Lucas told reporters after a meeting of the top farm-bill negotiators.

Reid’s Position

Senate Majority Leader Harry Reid, a Nevada Democrat, said yesterday the Senate won’t extend current farm law if Congress can’t agree on a longer-term version before the holiday break, according to the Associated Press. Meanwhile, farm bill negotiations remain “unresolved,” Senator Saxby Chambliss, a Georgia Republican involved in the talks, said in an interview.

Cuts to food stamps, along with changes to crop insurance programs and other farm aid, have been stumbling blocks as lawmakers seek to resolve differences in Senate and House versions of a reauthorization of agricultural programs.

Lucas’s temporary measure is designed to give negotiators more time to reach a deal on a five-year bill that would replace direct payments to farmers with an insurance-based crop safety net while tightening eligibility for domestic nutrition programs such as food stamps.

Among the reasons for a delay in the talks was that a Congressional Budget Office analysis necessary to calculate the costs of any agreement was stuck in another state because of this week’s storms, lawmakers said.

‘Very Close’

“We’re very close,” said Representative Collin Peterson of Minnesota, the top Democrat on the House Agriculture Committee. “We just need to nail it down.”

Issues that need to be resolved include work requirements and drug testing that are part of a House food-stamp bill passed in September and the acreage formula used to calculate farm-aid payments, Peterson said.

The main effect of an extension to the end of January would be to allay fears of milk prices rising after Jan. 1, when dairy is the first crop program set to revert to the 1949 policies form the underlying language of all subsequent farm bills.

Under the law, the government would be required to stockpile milk until it reached $37.20 per hundred pounds, nearly double the current price of dairy futures traded in Chicago.

Corn, Wheat

Other commodities, including corn and wheat, would see their programs revert to archaic programs later in the year. The longer the law is pushed back, the more it complicates life for farmers seeking loans to cover production costs and choosing crop-insurance policies for the upcoming year, said Sam Willett, senior public policy director for the National Corn Growers Association in Washington.

Farm groups are generally wary that repeated short-term extensions may increase the chance that Congress will decide to punt on the debate and simply pass a one- or-two-year extension of current law rather than revise farm policy, said Chris Galen, spokesman for the Arlington, Virginia-based National Milk Producers Federation.

“Anything that further drags out the process would make us nervous,” Galen said in a telephone interview. “Talk of an extension into January is premature when there is still time on the clock to pass a farm bill this year.”

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