Harkin yes, Grassley no as Senate approves Farm Bill

The U.S. Senate approved a compromise five-year farm bill this afternoon by 68 votes to 32 (roll call). As occurred in the House of Representatives last week, the farm bill drew substantial support from both caucuses. At the same time, a sizable number of conservative Republicans opposed the bill because of the costs, while some liberal Democrats voted no because of cuts to the Supplemental Nutrition Assistance Program, commonly known as food stamps. Iowa’s Democratic Senator Tom Harkin voted for ending debate on the farm bill yesterday and for the conference report today. Republican Senator Chuck Grassley voted no on cloture and on final passage.

After the jump I’ve posted statements from Harkin and Grassley explaining their stance on the farm bill. Click here for details on the contentious provisions of the farm bill. For once I am inclined to agree more with Grassley than with Harkin. In many respects the conference report was a missed opportunity and won’t serve the interests of Iowans or Americans generally.

I also sympathize with Grassley’s outrage at “a select few members dismantling a provision that was passed by wide, bipartisan majorities in both the House and the Senate.” Congressional rules should be changed so that the conference committee can alter only provisions that differed in the House and Senate bills, not consensus language from both versions.  

On the other hand, I suspect Grassley cast this protest vote because he knew his support wasn’t required to get the farm bill to President Barack Obama’s desk. As disappointing as this legislation is, Iowa’s economy truly needs stability and predictability in federal agricultural programs.

UPDATE: Added Iowa Secretary of Agriculture Bill Northey’s comments below.  

Statement from Senator Tom Harkin, January 27:

Harkin Commends and Supports Farm Bill Conference Agreement

WASHINGTON, D.C. – Senator Tom Harkin (D-IA), a farm bill conferee, today issued the following statement after the Senate-House conference committee reached an agreement on a new bill.  The bipartisan, bicameral agreement will help to reduce the federal budget deficit while strengthening the economy in rural areas and nationally, providing future certainty and income protection to the agricultural sector, conserving natural resources, promoting healthier nutrition, and boosting renewable energy.  The Agricultural Act of 2014 contains major reforms including eliminating the direct commodity payments program, streamlining and consolidating numerous programs to improve their effectiveness and reduce duplication, and cutting down on program misuse.  The proposal continues numerous reforms and progressive policies that were created, expanded, or strengthened in previous farm bills when Harkin was chairman of the Senate Committee on Agriculture, Nutrition, and Forestry.  He is now a senior member of the Committee.

“This proposal is a sound, balanced, bipartisan bill.  It contains significant reforms, and extends and funds progressive elements that I was proud to include in previous farm bills.  Such elements include the promotion of local foods and better nutrition, the conservation of our natural resources, and investments in renewable energy and farm income protection.

“This agreement is not perfect and each side had to give a little.  For example, I had hoped the bill could do more for conservation, but recognize the limitations of this budget environment.  So too did conferees have to negotiate on support for modest food assistance.  I take solace in knowing that no one who needs this assistance will be kicked off the program.

“With this bipartisan agreement now ready, the U.S. House should take up and pass this measure as soon as possible and send it to the U.S. Senate for consideration.”  

For more information on the agreement, please visit the Senate Agriculture Committee’s website.

Senator Chuck Grassley’s floor statement of January 30 (as prepared):

Mr. President, I rise to speak about the Agricultural Act of 2014, also known as the Farm Bill.

This farm bill process has been long, hard and no doubt frustrating for all who have been involved.  Some of us on the Senate Agriculture Committee have participated in two committee markups and two floor debates for this bill.  I voted for and supported the bill at every one of those junctures.

I believe our country needs good farm policy, which means an adequate, yet limited safety net for farmers.  Our farmers face real, uncontrollable risks every year.  The farm bill provides farmers with a number of programs that help mitigate those risks.

Agriculture remains a changing industry.  Unbelievable technological advancements are taking place right before our eyes.  Farmers can now control irrigation equipment and monitor grain bins on their phones from the other side of the world.

Agriculture technology is progressing so quickly, the next time we debate the farm bill, autonomous tractors may well be doing a considerable amount of the field work in America.

Farm policy has also changed over time.  Unfortunately, the majority of farm program benefits have started going to a concentrated number of farmers.  In fact, 10 percent of farmers get 70 percent of the benefits in the farm bill.  One reason for this, is that current farm policy offer farmers essentially unlimited subsidies if they hire the right lawyer.

As a farmer, a citizen and a legislator, I believe it is wrong to expect, or allow the government to give unlimited support to my farm, or any farm.  Especially since our country has a record $17 trillion debt.

During the first full Senate farm bill debate in the summer of 2012, my payment limit reforms were adopted by a vote of 75-24 here on the floor of this body.  During the first round of floor debate in the House, Mr. Fortenberry from Nebraska offered the same reforms and the House adopted them by a vote of 230-194.

Congress has spoken and overwhelmingly agrees with my common sense approach.

One would think policy, which is widely supported in both bodies of Congress, and which saves taxpayers nearly $400 million, would be untouchable in a conference committee.  The rules of this institution outline that.  It’s Senate Rule 28 if anyone would like to look it up.

However, once again, behind closed doors, Washington decided to intentionally screw up common sense.

This conference bill increases the payments available through the counter-cyclical program, now called Price Loss Coverage or PLC, by 150 percent compared to what Congress had already agreed upon.  And I have yet to hear a single legitimate reason for this change.

Additionally, the powers that be in this town have proven they learned nothing from the World Trade Organization Brazil cotton case.  That dispute has resulted in the U.S. paying a $143 million fine per year to Brazilian cotton farmers.  This farm bill doubles down on the same market distorting policies that brought us that trade dispute.

The original payment limit reforms this Congress approved also eliminated abuses through what is known as the ‘actively engaged loophole.’  To sum up this loophole, it makes it easy for non-farmers to get farm subsidies.  This results in the largest 10 percent of farms getting 70 percent of the farm program benefits as I’ve already mentioned.

Yet the conference committee, in another brazen act of manipulation, eliminates my simple, enforceable reform.  I think one non-farming manager per entity is more than generous.

The language in the bill now says USDA will have the opportunity to review and fix the actively engaged loophole, should they choose to.  USDA could have fixed this problem at any point since it is the result of their rulemaking.  So giving USDA power they already have, and claiming reform, is a true example of a Washington hat trick.  The conferees didn’t stop at just kicking the decision to USDA, they also tied USDA’s hands with unnecessary requirements that must be met before action can even be taken.

I hope Secretary Vilsack and the Obama Administration finally use this authority to produce a strong enforceable rule regarding the number of people who can be eligible for farm subsidies from taxpayers.   I’m certainly going to offer them my thoughts on the issue.  

The Government Accountability Office released a report in October of 2013 that clearly outlined the problems with the actively engaged loophole.  One farming partnership they highlighted was composed of twenty-two LLCs, with twenty different owners and sixteen ‘managers’ who got their eligibility through the actively engaged loophole.

At least four of the managers for that operation live out of the state while several others live in cities around the state, well outside of commuting distance.

Additionally, just yesterday, it was reported that a large farming operation in Illinois is being fined $5.3 million because they were exploiting taxpayers for farm subsidies. In this case, the government determined their business structure was intentionally designed to evade payment limits with the exact fake entity structures my provisions would have nearly eliminated.

U.S. Attorney Jim Lewis said the following regarding the case-

“We are pleased with this favorable resolution of the government’s claims of misuse of farm subsidy programs.  These programs are designed to help farmers withstand market price volatility and the intrinsic risks associated with farming from year to year. Any attempt to exploit the system to take more than one’s fair share is an improper use of government funds that erodes the public confidence in such programs and threatens their continued viability.”

I wish that U.S. Attorney could have been part of the farm bill conference committee; his logic and expertise would have really helped.

If a farm’s business model depends on lawyers setting up complicated Mickey Mouse legal structures, just to get more government subsidies, perhaps the owners of that entity are in the wrong business.

My provisions would have limited subsidies going to a few thousand people who are very well off and quite frankly don’t need unlimited farm payments from the government.  Especially, since by definition, they would be people who don’t actually work on farms!

If we can’t cut subsidies that go to non-farming millionaires, how will we ever find the courage to fix the other entitlement programs this country has?

With all that said, there are a few things this bill does that are good.

The dairy provisions have ended up more market oriented than where we started which I believe is a very good thing.  I’m glad the crop insurance program will remain strong for farmers across the country.  And the nutrition program reforms are welcomed.  

In the end, I have to make a judgment of the bill as a whole.  I believe this bill, sadly, is a missed opportunity.   The Congressional Budget Office says the final savings in this bill is only $16.6 billion.  That is a pretty small amount, compared to the fact it will spend nearly a trillion dollars.

I played by the rules with my reforms, they were adopted on the floor of both bodies of Congress.  Yet in the end, a few people with the single minded intent to keep unlimited farm subsidies flowing out the door proved Congress deserves its 12 percent approval rating.

I want to be clear- I strongly support the business Agriculture.  I’ve been involved in farming my whole life.  I understand the industry.  Growing wholesome food to feed the world has always been one of the noblest occupations in my opinion.

But if I were to vote yes on this bill, it would be an endorsement of the egregious manipulation of my payment limit reforms behind closed doors.  I cannot in good conscience do that.  Therefore, I will oppose to Agricultural Act of 2014.

Mr. President, I yield the floor.

Grassley press release, February 4:

For Immediate Release

Tuesday, February 4, 2014

Senator Chuck Grassley released the following statement after the Senate passed the Agricultural Act of 2014 by a vote of 68-32.  Grassley voted against the measure.

“I’m extremely disappointed that my provisions to place a hard cap on farm payments and better define who can receive those payments were stripped down to such a great extent that they likely won’t have much effect.  Unfortunately, a few members of the House and Senate placed parochial interests above the broader good for the agricultural community.  

“Currently 10 percent of the wealthiest farmers receive 70 percent of the benefit from the farm program.  This puts small- and medium-sized farms and young and beginning farmers at a disadvantage.  These are the very people the farm program is supposed to help.  The committee leaders negotiating the final bill struck my simple, common-sense and enforceable provisions from the final bill.

“As a farmer myself, I understand how a five-year farm bill helps with long-term planning, and there are some good things in the bill.  But, I can’t turn a blind eye to a select few members dismantling a provision that was passed by wide, bipartisan majorities in both the House and the Senate.”

UPDATE: Speaking to Radio Iowa, Iowa Secretary of Agriculture Bill Northey said he’s relieved the farm bill passed. He mostly praised the bill’s provisions, but added,

“There are some concerns about the County of Origin Labeling provisions that could’ve been addressed in the Farm Bill…they were not, at least not in a way that’s likely to satisfy the disagreements between the U.S. and Canada on that,” Northey said.

When asked about Grassley’s vote against the conference report, Northey was tactful:

“Senator Grassley had some provisions dealing with payment limitations,” Northey said. “Although it had a lot of support, it was taken out at the end, so I think a lot of folks would’ve liked to see that in the Farm Bill as well.”

  • Heller

    Dean Heller votes No.  We always hear reports about how he’s trying to get this and that through in order to help the gaming industry or Nevada more broadly.  Doesn’t he realize that if you don’t help other people out they aren’t going to return the favor?  

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