WASHINGTON, May 24, 2013 – Ahead of the Memorial Day recess, the Senate resumed consideration Thursday of its five-year farm bill (S.954) and worked through several amendments, including passage of one that would lower premium subsidies of crop insurance for larger farm operations.
The Senate is scheduled to continue debate on the bill June 3. Senate Agriculture, Nutrition and Forestry Committee ranking member Thad Cochran, R-Miss., said more than 200 amendments remained that have been filed to the bill. However, most of the amendments will not be considered.
“We’ve made true progress in developing what I think can be a very important contribution toward a legislative framework to help enable American farmers to compete in the international marketplace and to sustain the jobs that flow from their work throughout the country,” Cochran said.
The Senate approved, with a 59-33 vote, an amendment offered by Senate Assistant Majority Leader Richard Durbin, D-Ill., and Sen. Tom Coburn, R-Okla., that seeks to reduce the level of premium subsidies for crop insurance policies by 15 percent for farmers with an adjusted gross income of more than $750,000.
Durbin argued that farmers’ contribution to crop insurance is 38 percent of the actual premium cost and taxpayers are left to pay the rest.
“What did it cost us last year?” Durbin said. “Over $7 billion, and then an additional billion dollars to administer the program.”
Durbin said the amendment would cut the average federal subsidy from 62 percent to 47 percent for that “tiny one percent of farmers making over $750,000.”
“Let me tell you, they can afford it,” Durbin said. “And we will save over the span of ten years a billion dollars.”
Coburn said four percent of U.S. farmers receive 33 percent of the benefits from crop insurance.
“The point being is what we ought to do is make sure there’s a safety net, the crop insurance is the way to do that, but we ought, like every other program, we’re going to eventually ask those who have more [money] to participate more [in cuts],” Coburn said.
Committee Chairwoman Debbie Stabenow, D-Mich., argued against the amendment, saying that “the farmer gets a bill, not a check.”
“We’ve ended subsidies through direct payments, we want them to move to a voluntary system of crop insurance,” Stabenow said. “They get a bill, it’s got to be a bill that they can afford to be able to provide the coverage, and then there is no payout unless you have a loss.”
Stabenow said that limiting crop insurance support would cause producers with large pieces of land to leave the insurance system, losing the conservation benefits, and possibly increasing the cost of crop insurance to smaller producers.
“If everybody is not in, the costs go up for who is in,” she said.
Approval of the amendment pleased Ferd Hoefner, policy director of the National Sustainable Agriculture Coalition.
“We are delighted the Senate held firm for common sense reforms that strengthen the farm safety net,” Hoefner said. “By once again passing the Durbin-Coburn amendment, the Senate is on record in support of reform that aids family farmers, reduces incentives to environmentally harmful overproduction, and saves the taxpayer money.”
The Senate approved, with a 94-0 vote, an amendment, offered by Sen. Kay Hagan, D-N.C., that seeks to reduce fraud and abuse in the crop insurance program.
Hagan said the amendment would provide additional tools to USDA’s Risk Management Agency to analyze and combat fraud, waste and abuse. Under the language, RMA could expand the sampling requirements to test for and address concerns with improper program payments.
“The issue of fraud in this program hit home for me in March of this year when the Justice Department announced a $100 million crop insurance fraud case in eastern North Carolina, the largest ever of its kind,” Hagan said. “Forty-one defendants were found guilty and many are serving prison time for profiting from false claims for losses of soybeans, wheat, tobacco, and corn.”
The Senate rejected, with a 44-52 vote, an amendment, offered by Sen. Dianne Feinstein, D-Calif., and Sen. John McCain, R-Ariz., that sought to eliminate taxpayer subsidized crop insurance for tobacco production.
The amendment would prohibit the payment by the Federal Crop Insurance Corporation of any portion of the premium for a policy or plan of insurance for tobacco.
Feinstein said tobacco growers are set to receive nearly $10 billion over the next 10 years in buyout payments for ending the tobacco program. Also, she said tobacco farmers received more than $276 billion in crop insurance subsidies since 2001.
In opposition, Sen. Richard Burr, R-N.C., said not “one dime of American taxpayer money” went to the tobacco buyout, and that all of the cost was absorbed by the tobacco companies.
“So yes, if the purchase of a pack of cigarettes and the profit that goes to a tobacco company and the dollar and one cent in federal taxes that they pay per pack of cigarettes is the American taxpayer paying the price of the buyout, [Feinstein] is right,” Burr said. “I’m not sure you can make that connection.”
Hagan joined Burr in beating down the amendment.
“This amendment unfairly targeted the nearly 2,000 small tobacco farmers in North Carolina that are doing nothing more than growing a legal crop, and I fought hard to protect our state's farmers and defeat the measure,” Hagan said after the vote. “The amendment would have done nothing to lower smoking rates or address public health issues associated with smoking, and will only result in the increased importation of tobacco.”
The Senate rejected, with a 27-71 vote, an amendment, offered by Sen. Bernard Sanders, I-Vt., which would allow states to have the right to require labels on any food or beverage containing ingredients that have been genetically modified.
“The concept we’re talking about today is a fairly common sense and non-radical idea,” Sanders said. “All over the world, in the European Union, in many other countries around the world, dozens and dozens of countries, people are able to look at the food that they are buying and determine through labeling whether or not that product contains genetically modified organisms.”
Sanders said large biotech companies, such as Monsanto, argue that states do not have the constitutional right to go forward with labeling.
“This [amendment] makes it very clear, states can go forward,” Sanders said.
Stabenow and Sen. Pat Roberts, R-Kan., spoke in opposition to the amendment.
“I do believe that this particular amendment would interfere with the FDA’s science-based process to determine what food labeling is necessary for consumers,” Stabenow said. “It’s also important to note that around the world now we are seeing genetically modified crops that have the ability to resist crop diseases and improve nutritional content and survive drought conditions in many developing countries.”
Roberts said the FDA has said it has no basis for concluding that bio-engineered foods are any different from other foods in “any meaningful or uniform way.”
Other amendments were discussed as well, with Sen. Jeff Merkley, D-Ore., attempting to offer one that he said would strike the so-called “Monsanto Protection Act.”
Merkley said the language in the bill would allow the “unrestricted sale and planting of new variants of genetically modified seeds that a court has ruled have not been properly examined for their effect on other farms, the environment, and human health.”
Sen. Roy Blunt, R-Mo., objected to calling up the amendment, saying the provision should be called the “Farmer Assurance Act.”
“Many have incorrectly claimed that this language gives priority to the needs of a small number of businesses, over the rights or needs of the American consumers,” Blunt said. “This provision doesn’t protect any seed company, Monsanto or Pioneer Seed or even the USDA.”
In addition, Sen. John Thune, R-S.D., talked about two of the amendments he has filed.
His first amendment seeks to reduce spending on the Supplemental Nutrition Assistance Program (SNAP) by $2 billion over 10 years by ensuring states get equal access to the funding through block grants.
“This program funnels 52 percent of the funding to only four states,” Thune said. “This is an inequitable use of funds that should be spent more equitably among program participants.”
Thune’s other amendment seeks to strike the Adverse Market Program, which he said would save more than $3 billion.
Meanwhile, the Congressional Budget Office issued a new scoring report that found the House Agriculture Committee’s farm bill would cost $940 billion over 10 years. CBO said the bill would reduce direct spending by $33.3 billion.
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