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Farm Bill Passes House with No Real Reform

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July 27, 2007 | Kate Matus ((202) 226-7326) | comments

WASHINGTON – First District Congressman Paul Ryan today voted against H.R. 2419, the Farm Bill Extension Act, expressing disappointment in the deeply flawed legislation which delivers no real reform to address the problems that plague the current agriculture subsidy system. The House passed the Farm Bill reauthorization by a vote of 231-191. 

Together with Rep. Ron Kind (D-WI) and a bipartisan coalition of members of Congress favoring farm policy reform, Ryan had proposed amendments to ensure that there is a fair and effective safety net for family farmers during difficult times, while at the same time tackling abuses within the present system and exercising greater care with taxpayer dollars. Unfortunately, these improvements were not adopted.

The Farm Bill that the House passed is largely a continuation of the status quo with its inequities and distortions. According to Citizens Against Government Waste, under existing agricultural policies, “subsidies overwhelmingly go to the largest farmers and agribusinesses. In 2003, the top 10 percent of farm subsidy recipients collected 72 percent of total subsidies.” In some cases – such as by providing a higher government support price for sugar and eliminating the current law limit on marketing loan benefits – today’s farm bill actually makes matters worse. Moreover, this fiscally irresponsible legislation contains budget gimmicks and increases taxes on certain American businesses owned by foreign companies – discouraging foreign investment and job growth here in the U.S. and violating existing tax treaties.

“Federal farm programs should provide a safety net for family farmers in times of need – not big subsidies for profitable corporate farms. Taxpayers and family farmers deserve better than the current system,” Ryan said. “The Farm Bill the House adopted not only fails to deliver real farm policy reform, but it also breaks the budget and risks American jobs by raising taxes on some foreign-owned businesses that operate in the U.S. Southern Wisconsin businesses such as Nestle and Case New Holland could be affected by this tax hike. I’m disappointed by this setback for our reform coalition but look forward to opportunities to build on the progress we made working together across party lines throughout this debate.”

A bipartisan group of representatives, backed by a diverse gathering of organizations including fiscal watchdogs, environmentalists, and anti-hunger activists, fought the status quo and put forward real reform solutions during the Farm Bill debate. 

Specifically, a comprehensive reform amendment to the Farm Bill – the “Fairness in Farm and Food Policy Amendment” – offered by Reps. Kind, Ryan, Flake (R-AZ.), Blumenauer (D-OR) and others on both sides of the aisle would have reined in the wasteful spending of the current subsidy system, directing the savings to deficit reduction, conservation programs, and hunger assistance. This amendment would have made sure struggling family farmers get assistance during difficult times, while curtailing subsidy payments to wealthy commercial farmers. Unfortunately, the amendment failed to win a majority of votes.

This amendment would have:

  • Replaced Depression-era price guarantees with a modern revenue-based safety net that better protects family farmers from declines in crop prices and crop yields compared to the current price-based payments.

  • Denied subsidies to large commercial farmers with average annual adjusted gross income greater than $250,000 and limited annual subsidies to $250,000 per person.

  • Gradually reduced direct payments for commodities, which were intended as “transitional” temporary payments under the 1996 Farm Bill, but have since been extended and increased. Limited-resource farmers would have been exempted from cuts.

  • Created optional Risk Management Accounts that would be available to every farmer and rancher and would work together with crop and revenue insurance already held by about 80 percent of producers. These “rainy day” accounts would have helped farmers set aside savings during profitable years to supplement their income during downturns.

  • Reformed crop insurance and reduced excessive payments to crop insurance companies that administer the program. 

  • Reduced the deficit by $1.9 billion over five years and by roughly $14 billion over 10 years – without resorting to budget gimmicks or tax hikes. 

  • Dedicated part of the savings generated by reforms to conservation and nutrition programs.

Additionally, Reps. Paul Ryan and Earl Blumenauer (D-OR) tried to offer a separate bipartisan amendment that would have capped farm subsidy payments at $250,000 per year; however, the House Rules Committee did not allow the House to consider or vote on the amendment – apparently because Democratic House leaders feared it could pass. This reform amendment would have prevented taxpayer dollars from being squandered on huge subsidies for large corporate farms. The savings from this amendment would have been directed toward deficit reduction and conservation and forestry programs.  

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