Ag Groups, Others Defend Crop Insurance as Conservative Groups Seek More Cuts
OMAHA (DTN) — Farm groups are trying to stave off demands to include more cuts in the farm bill for crop insurance and commodity programs.
Crop insurance and commodity programs made it through the House Agriculture Committee unscathed, but conservative groups are backing bills and pushing for more reforms once the farm bill hits the House floor for debate, likely in mid-May.
A group of 65 organizations — including farm, conservation and wildlife groups — sent a letter Thursday to every member of the House of Representatives, urging them not to propose amendments to the farm bill “that would do significant harm to crop insurance and to rural America.”
The groups stated they were opposed to any amendments that would reduce or limit participation in crop insurance, make crop insurance more expensive or “harm private-sector delivery” of crop insurance. The groups detailed the justification for crop insurance for farmers and the value to taxpayers by avoiding ad-hoc disaster aid to producers. And the letter urged congressmen to oppose any amendments to the farm bill that would harm crop insurance.
Not knowing exactly when the farm bill was going to come to the House floor, supporters of crop insurance felt the need to remind congressmen about the value of crop insurance and also to reach out to more 110 congressmen who were not in office the last time a farm bill came to the House floor.
“There was a collective opinion that let’s not take anything for granted,” said Sam Willett, senior director of public policy for the National Corn Growers Association. “We know there are groups out there, maybe working together in a more coordinated and collaborative way to push for some big changes in the crop-insurance program.”
Willett said he expects some challenges to come against pieces of crop insurance such as the Harvest Price Option, which has been attacked in the past. The Congressional Budget Office projects $19 billion in taxpayer savings would be generated if the add-on to revenue insurance was eliminated from premium subsidies.
“For corn growers, it may be as high as 98% have the Harvest Price Option embedded in their insurance policies,” Willett said. “Consequently, it would have a very harmful change on the program … I don’t think there’s any disagreement it would have a very severe impact on growers’ ability to buy crop insurance with meaningful coverage.”
The letter was sent as Rep. Paul Gosar, R-Ariz., and freshman Rep. Ralph Norman, R-S.C., co-sponsored H.R. 5629, dubbed “President Trump’s Farm Bill Reforms Act of 2018.” The bill would follow through on some crop-insurance and commodity proposals in the president’s budget, which would trim about $2.86 billion a year off taxpayer spending for those programs. The bill has the backing of several conservative lobby groups, including FreedomWorks, Taxpayers for Common Sense and the National Taxpayers Union.
“If we are serious about tackling our nation’s spending problem, then we cannot be afraid to enact the common sense reforms to our farm safety net that were outlined in President Trump’s budget for fiscal year 2019,” said Norman, who joined Congress last June after winning a special election for White House Budget Director Mick Mulvaney’s seat. Neither Norman nor Gosar serves on the House Ag Committee.
FreedomWorks posted a blog supporting Norman’s bill, noting, “The biggest, most important change in this bill is to reduce crop insurance subsidies. The federal government spends far too much to eliminate risk to farmers as well as approved crop insurance agents.”
Heritage Foundation came out and acknowledged support for the changes in the nutrition program in the farm bill, but also called for more changes in commodity programs and crop insurance. The American Enterprise Institute also has an event scheduled next week on Capitol Hill to make its case for more cuts.
It’s likely there will be a push for more cuts to farm programs as GOP House members seek to demonstrate Republicans still believe in fiscal responsibility after a tax-cut package that added more than $1.5 trillion to the budget deficit over 10 years and a recent spending bill that topped $1.3 trillion in annual costs.
“We always knew this was not going to be the easiest process,” Willett said. “We’re going to draw the line and say ‘No more cuts to crop insurance.'”
Agriculture Committee Chairman Mike Conaway, R-Texas, spoke with farm broadcaster Mike Adams on “Adams on Agriculture” on Thursday. Conaway said he wants to curb congressmen from bringing amendments to the bill if those congressmen will end up opposing the farm bill anyway.
“I’m expecting that the Republicans will actively work to make the bill better,” Conaway said. “There may be some outliers who want to strip out some things out of the safety net portion it, but we’ll have a rule that allows those folks who will be a ‘yes’ on final (passage) to suggest changes.”
Conaway also said in that interview that he has been talking to members of the conservative Freedom Caucus individually to gain their support for the farm bill. Conaway added that the farm bill might not come to the floor the week of May 7, but the following week in May.
The Republican Study Committee, which includes a large number of GOP House members, also introduced a budget proposal on Wednesday called “A Framework for United Conservatism” that proposes cuts throughout the federal budget. In agriculture, the plan details several changes to the farm bill and cites that most of those recommendations were outlined last November in a letter to Conaway.
The RSC would seek to again advance the effort to decouple the nutrition portion of the farm bill from the farm safety net sections of the bill, then block-grant the Supplemental Nutrition Assistance Program to the states. Such an effort in 2013 led to the first defeat of a farm bill on the House floor.
But the RSC document goes much further by seeking to eliminate commodity programs from the farm bill. The paper cites that the Agricultural Risk Coverage and Price Loss Coverage programs cost nearly $20 billion more than initially projected. “This is just another example of how it is impossible for government to accurately predict and control market conditions.” The report then notes that eliminating commodity programs would save taxpayers $50 billion over 10 years.
The Republican Study Committee would also eliminate the sugar and milk safety nets, commodity checkoff programs and change crop insurance. With crop insurance, the report falls in line with proposals from the Trump administration to reduce subsidy premiums and operating reimbursements to crop insurance companies.
Nineteen members of the House Agriculture Committee are also listed as members of the RSC, including Conaway.