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Q&A: Questions and answers about the farm bill

Monday - 6/3/2013, 3:32pm  ET

FILE - This Dec. 4, 2012, file photo shows gallons of milk arranged at a Milwaukee grocery store. This week the Senate resumes debate on the almost $100 billion-a-year, massive, five-year farm bill that would set policy for farm subsidies and food stamps. The bill covers everything from protecting environmentally sensitive land to international food aid to rural communications services. The House is expected to consider their version in June or July. (AP Photo/Dinesh Ramde, File)

MARY CLARE JALONICK
Associated Press

WASHINGTON (AP) -- The Senate is considering a massive, five-year farm bill this week that would set policy for farm subsidies and food stamps. Here are answers to frequently asked questions about the nearly $100 billion-a-year bill:

Q: What is the farm bill?

A: It's a wide-ranging bill, usually written every five years, that outlines government farm subsidies and pays for the country's nutrition programs, including food stamps. It also sets dollar levels for the Agriculture Department and subsidizes farmers and rural communities for a multitude of things -- from protecting environmentally sensitive land to international food aid to rural communications services.

Q: How much does it cost?

A: The Congressional Budget Office estimates that farm and nutrition programs will cost almost a trillion dollars over the next 10 years. Broken down by year, the farm bill passed by the Senate Agriculture Committee in May would cost almost $96 billion annually and a similar version passed out of the House Agriculture Committee would cost $94 billion annually.

Q: Why so much money? Where does most of that money go?

A: Almost 80 percent of the money will go to food stamps for the needy -- now called the Supplemental Nutrition Assistance Program, or SNAP. Around 15 percent of the money is designated for farm subsidies and crop insurance subsidies. The rest would go to conservation, rural development, renewable energy and other farm programs.

Q: Why do food stamps cost so much?

A: SNAP has more than doubled in cost since 2008 due to the economic downturn, fluctuating food prices and eligibility requirements loosened in the 2009 economic stimulus bill. In 2012, 46.6 million people used the program at a cost of $78.4 billion.

Q: Why are food stamps in the farm bill?

A: The Agriculture Department oversees the food stamp program, and several decades ago lawmakers combined nutrition programs with agricultural supports in the farm bill to gain urban votes. While food stamps have generally helped the farm bill move through Congress, this year conservatives are giving it greater scrutiny.

Q: Is money for food stamps cut in the bill?

A: The Senate bill would cut about $400 million a year from the SNAP program, or about 0.5 percent. The House bill would cut a little more than 3 percent, or about $2 billion a year, and also change the way people qualify for the program. The House legislation would achieve some of the cuts by partially eliminating what is called categorical eligibility, or giving people automatic food stamp benefits when they sign up for certain other programs. Both bills also would save dollars by ending a practice in some states of giving low-income people as little as $1 dollar a year in home heating assistance, even when they don't have heating bills, in order to make them eligible for increased food stamp benefits.

Q: What about farm subsidy cuts?

A: The bill would eliminate subsidies called direct payments, which cost about $5 billion a year and are paid to farmers whether they farm or not. But it uses some of those savings to create new farm subsidies and expand crop insurance.

Q: Are there overall savings in the bill?

A: The bills do cut some overall spending. Including the nutrition cuts, the Senate bill would contribute about $2.4 billion annually to deficit reduction and the House bill would reduce spending by almost $4 billion annually. Most of those savings come from the food stamp cuts, eliminating the direct payments and money already saved through across-the-board cuts earlier this year.

Q: Why does the government subsidize farmers?

A: Farm-state lawmakers have traditionally argued that farmers need a government safety net because agriculture is a tough, unpredictable industry and the nation's food supply is dependent on family farms staying in business. However, prices have skyrocketed for many crops, and conservatives, urban lawmakers and environmentalists, among other critics, say too much of the money goes to wealthy farmers and large, corporate agribusinesses. This bill would transition some farm supports to crop insurance, which is paid out when farmers lose revenue or lose crops to bad weather.

Q: How's farm country doing these days?

A: Very well. Agriculture is one of the strongest sectors of the U.S. economy, with net farm income expected to increase more than 13 percent to almost $130 billion in 2013.

Q: So why is there so much support in Congress for farm subsidies?

A: Farm-state members have for decades created a successful bipartisan coalition in Congress to protect their interests. Despite regional differences, members from rural states across the country have banded together to defend the core of the nation's farm programs. Because the Senate gives equal representation to all states, members from rural farm states are especially powerful there.

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