Progressive Farmer
Small and Large in Farm Bill Hearing
Farm Size Is No Small Argument in Farm Bill Debate
By Chris Clayton, DTN Ag Policy Editor
OMAHA (DTN) -- Arguments over helping small, mid-size and large farmers were a constant theme Thursday as U.S. Agriculture Secretary Tom Vilsack pressed his case to senators that the farm bill should better help the 90% of farmers he says were struggling even as farm income hit record levels over the past two years.
In Washington, Vilsack testified before the Senate Agriculture Committee on the farm bill and USDA programs. The hearing had its moments of contention, as Vilsack sparred with senators from both parties about USDA programs, their rollouts and who is receiving support from agencies.
Early on, Sen. John Boozman, R-Ark., ranking member of the committee, complained that Vilsack has been slow to respond to committee requests for information, including some bipartisan letters. Boozman said getting timely responses is critical for understanding policies and drafting a farm bill. "The lack of responsiveness lately has been disappointing," Boozman said.
After acknowledging that writing a farm bill "is no easy task," Vilsack said his staff will provide timely responses for lawmakers, but he added that senators should "just simply target what you really want and not provide a laundry list of things that could be considered somewhat of a fishing expedition."
In his opening comments, Boozman pointed to the need for a farm bill that will ensure the country has a vibrant agricultural economy but pointed to the agricultural trade deficit last year and the rising input costs facing farmers.
"This is why when I meet with my farmers, they all tell me the safety net is frayed and needs to be reinforced." He added, "The safety net does not reflect the current levels of risk taken on each year by those who provide the food, fiber and fuel we depend on."
SMALL AND LARGE
Still, Boozman added, "As we address these risks, it's critical that we not be consumed by the small-farm-versus-big-farm conflict."
Boozman noted 89% of farms nationally are classified as small, and they generate nearly 18% of farm production. The top 3.2% of farms classified as large contribute 46.5% of farm production.
"All farms are valuable. This farm bill will not neglect the small nor punish the large," Boozman said.
Vilsack repeated comments that have become the basis for his speeches lately. While net farm cash income has hit record levels over the past two years, nearly 50% of farmers lost money while another 40% make the majority of their income off the farm.
"This is not a small-versus-large situation," Vilsack said. "This is a situation where 90% of our farmers need help."
To avoid the "hollowing out" of rural America, Vilsack added, "We have got to figure out how we can create more revenue streams for farmers, especially those small- and mid-sized producers."
Sen. Cindy Hyde-Smith, R-Miss., defended larger farm operations, citing that their size allows them to "capitalize on the benefits of economies of size and the efficiencies as they work to feed and clothe this world." She added, "They are the primary reason America is home to the most efficient and sustainable agricultural production system the world has ever known."
Vilsack responded, "We need both. We clearly need production, there's no question about that, and we're going to continue to have incredibly large, efficient, effective operations." He added, "We spend a lot of time and focus on those large-scale producers because of the nature of productivity."
But the secretary also noted, "So, the problem is farms continue to be larger, and larger and larger, OK, which squeezes out the small- and mid-sized farming operations, which populate the rural communities, which support the Main Street businesses. So, the challenge for us is how do we do both? How do you create a circumstance in the farm bill that basically says, 'Yeah, you gotta help the big guys. No problem,' but don't forget about the rest of them."
Sen. Chuck Grassley, R-Iowa, picked up on the issue of larger farmers and payment limits. He said the farm safety net is supposed to help farmers "weather the storm," but current law ensures "10% of farmers are getting 70% of the benefits of the farm programs." While some lawmakers want to tighten work requirements for food aid, he would like to see the same to ensure people receiving farm payments are actively engaged in production as well.
"I hope we would also look at work requirements in Title 1 of the farm bill to ensure people actively engaged in the process of farming benefit," Grassley said.
CARBON MARKETS
Sen. Debbie Stabenow, D-Mich., chairwoman of the committee, asked Vilsack about carbon markets, noting the chairman of the Commodity Futures Trading Commission (CFTC) raised concerns about potential fraud. Stabenow also wanted to know what USDA has done to implement the Growing Climate Solutions Act and how that would ensure integrity in those markets. Vilsack said USDA would be putting together a report by August for Congress and conduct a review of carbon and other ecosystem service markets for farmers.
"There are roughly 24 markets we can take advantage of today with climate-smart practices," Vilsack said. He added, "We have to make sure that they are farmer friendly -- that they are useable by farmers. Many of these private markets today are not really structured for farmers. They are structured for investment banks and so forth. And that doesn't really work very well."
BIRD FLU
Sen. Tommy Tuberville, R-Ala., raised concerns that USDA would like to use vaccines as a solution to highly pathogenic avian influenza (HPAI). Poultry makes up 65% of agricultural productivity in Alabama, and a vaccine could effectively cut off exports to countries that will not accept poultry products vaccinated for bird flu. Vilsack said that right now, there is no vaccine for the current outbreak.
"We're a long way away from having a vaccine that's effective," Vilsack said, "and a long way from having a vaccine that the rest of the world would accept."
THRIFTY FOOD PLAN
Vilsack also drew heat from Republican senators over USDA's update of the Thrifty Food Plan for people on the Supplemental Nutrition Assistance Program (SNAP). The Thrifty Food Plan assessed how much it costs for people to eat a healthy diet and is the basis for deciding maximum SNAP benefits. As required by the 2018 farm bill, USDA updated those guidelines in 2021. The result was that the SNAP budget ballooned to somewhere between $250 billion and $300 billion over 10 years.
Sen. Debbie Stabenow, D-Mich., chairwoman of the committee, noted the Thrifty Food Plan has been talked about in committee "and other places as well" but asked Vilsack if the update should be budget neutral.
Vilsack said his staff was following the 2008 and 2018 farm bills. "There's no mention in the law that directed us to do the work that we need to do on a cost-neutral basis."
Boozman pointed out the Congressional Budget Office (CBO) determined under the Trump administration's plans that the plan update would be revenue neutral. Boozman and Sen. John Thune, R-S.D., each said USDA should not have unilateral authority to decide on a plan that would spend $300 billion without congressional approval.
"My point is, when you are going to spend $300 billion, you come to Congress and say this is a problem. We need to address it," Boozman said. "Let's work together and sort this out ... But the idea that an agency can spend $300 billion without congressional direction -- the entire last bill that was the Inflation Reduction Act was only $750 billion. So, this was a massive amount of money, and it wasn't done right."
WHO'S GETTING PACKER MONEY?
Sen Joni Ernst, R-Iowa, questioned "Green New Deal" spending by the Biden administration, but homed in on $157 million that has been provided to meatpackers under the Meat and Poultry Processing Expansion Program. Ernst cited that just three privately owned plants split $69 million in funding, all of which have gone to facilities owned by wealthy people, including one owned by a person on the Forbes billionaire list.
"The discouraging part is when we see such incredibly large producers, those on the billionaire's list, receiving free dollars from our taxpayers," Ernst said.
Vilsack said 31 projects have been awarded money, including some farmer cooperatives, and a lot of funds have gone to smaller facilities instead of larger ones. The grants were based on the level of investment for each project, and none have gone to the "Big Four" packers. Vilsack also assured Ernst that more grant money was coming after she cited at least two projects in her state that so far "are deemed unworthy for these grants."
Also see, "Lawmakers Hear Texas-Size Challenges for Next Farm Bill," https://www.dtnpf.com/agriculture/web/ag/blogs/ag-policy-blog/blog-post/2023/03/16/lawmakers-hear-texas-size-challenges