By Stewart Doan
© Copyright Agri-Pulse Communications, Inc.
WASHINGTON, Jan. 25 – One of America’s most influential agricultural policy experts joins us this week on Open Mic. Dr. Barry Flinchbaugh of Kansas State University addresses his involvement in shaping the 1996 Farm Bill, dubbed “Freedom to Farm” by supporters and “Freedom to Fail” by critics. The outspoken Flinchbaugh maintains that the “Freedom to Farm” concepts are as valid today as they were 15 years ago, but he says the current political, budget and commodity price environment bears little resemblance to the mid-90s. He comments on the major players in the 2012 Farm Bill debate – both on Capitol Hill and in the Obama administration, the ability of traditional farm interests to affect the outcome, the future of Direct Payments and the Average Crop Revenue Election or ACRE program, and the real-world impacts of regulation on farmers and ranchers. If you have a stake in U.S. ag policy, you will want to hear what Flinchbaugh has to say.
Open Mic with Barry Flinchbaugh transcript:
SD: Dr. Flinchbaugh, welcome to Agri-Pulse Open Mic.
BF: Thank you sir. I appreciate the opportunity.
SD: Something I have always been curious about with the 1996 Farm Bill, dubbed Freedom to Farm, it has been said that then House Agriculture Committee chairman Pat Roberts got the idea for Freedom to Farm from you. Is that true?
BF: Well, it’s always the chairman’s bill. I’ve had a long, long relationship with Pat, way back to the early ‘70s. I talked about a decoupled program probably ten years before the ’96 Farm Bill, maybe even longer than that, but I came at this from the standpoint of “let’s let the marketplace work as much as is possible”. It’s still more efficient than any other system.
SD: Within two years of its enactment, Congress did have to come back in and basically double the AMTA payment. Was that an admission that Freedom to Farm, at least the safety net component of it, was insufficient?
BF: Well, the short answer to that question is yes. There’s severe pressure coming from farm country when the bottom drops out of the market, which it did, the pressure is there to get back in and I remember the debate over Freedom to Farm, in fact I had a debate at the time privately with Senator Dole, who said, “What are we going to do when the world market goes down or there’s a severe recession around the world?” And I said, “Well if you believe this, you do nothing,” and he laughed at me, rightfully so, and said the pressure will be there. I said, “Well you’re the Majority Leader. You can handle it.” Then I told him that this is the first Farm Bill in history where we could solve the problem. Without going back in and redoing it, we could simply double the decoupled fixed payments or whatever you can get through the converse. I think in my conversations with him over the years that did help convince him to support Freedom to Farm. So the concept is still very valid.
SD: The ’96 bill was written during challenging budget times just like we have today. As Congress prepares to draft the 2012 Farm Bill, are there other similarities between then and now?
BF: There aren’t many. A lot of things have changed since ’96. It’s always easier to debate a Farm Bill when the farm economy is not doing very well than it is when the farm economy is doing as well as it is now. It’s actually doing better now than it was back in the ‘90s, and another thing that is happening is that, with the exception of dairy (and it’s coming back I would argue), but it’s rare to have the feed grain industry and the livestock industry doing well at the same time. That’s only happened maybe three or four times in my forty-year career. And, kind of a side note, all this euphoria and hype that’s out there now and the prices are going to continue to go up and they’re never coming down, I’ve heard that crap which is just what it is. This is the third time in my career I’ve heard this. So I will clearly argue during this Farm Bill debate two things. One, we cannot pull the plug and not have a safety net as long as our competitors have a safety net and, two, this euphoria will end. Now there’s one distinct difference between this situation and what we had in the late ‘70s and the early ‘80s and that is that most of these land purchases et cetera are being paid for by cash instead of borrowed money and that’s a huge difference. The budget situation is much more severe than it was then. We have completely different factors in charge. When we had Dan Glickman as Secretary and Bill Clinton as President, I worked as close with Glickman as I have Roberts and Dan got it. He understood it. And they worked together very well. We had more Southern influence in the ‘90s than we have on the Committee now, even though you could call Frank Lucas Southern but we don’t have the Deep South influence. We have a completely different Secretary.
SD: How so?
BF: Well, first of all, I don’t think he’s an expert on farm programs. He has gotten himself in lots of trouble. We haven’t seen him in Kansas for example. He talks more about organic farming. He just came off of this coexistence meeting, which we will have to coexist, but we’ve got to start from a level playing field. Glickman had been Chairman of the Wheat, Feed Grains, and Oilseed separate Committee of the House Ag Committee for quite a few years. He was a creature of Congress, and he and Roberts had a long history of putting Kansas farmers first and partisan politics second. That atmosphere has completely changed. The Secretary is not a man of the Congress. The President comes from Chicago; he doesn’t have traditional agricultural surroundings. Secretary Vilsack and Chairman Lucas will not get along like Secretary Glickman and Chairman Roberts did. So there is a huge political difference and the House Ag Committee especially has always prided itself in putting farmers first and partisan politics second. I know Frank Lucas quite well. I joke I helped bring him up from a pup and I talk to him fairly regularly and Frank gets it. He and Colin Peterson respect each other and have a history of working together and they will try but it’s going to be very hard for the House Ag Committee to maintain a bipartisan approach. Colin’s party is run by ex-Speaker Pelosi, who’s as controversial politician as I’ve ever followed and now Speaker Boehner understands agriculture some and has farmers in his district but once this bill gets out of the House Ag Committee, I don’t think you can possibly avoid a partisan battle.
SD: With Lucas and Peterson seemingly in agreement that this next Farm Bill will be a baseline bill, then what kind of safety net will a six million dollar budget buy you?
BF: Well, it’ll buy basically two things. It’ll buy a continuation of the decoupled fix payment and CRP, in rough numbers. You know, I’m convinced when we really do this next year, the baseline will be somewhat higher, but obviously the budget situation is a lot tougher. Speaker Boehner will have to deal with these freshmen who frankly have no idea where little babies come from in the political world or they wouldn’t be talking about allowing the U.S. government to default. It’s going to be tough, but don’t ever underestimate the House and Senate Ag Committees. Never underestimate the ability of the farm organizations.
SD: Are you worried that direct payments are doomed? The opponents of direct payments, they want some sort of a revenue assurance program like ACRE to be the successor safety net. How do you see that all working out?
BF: Well, right now they don’t have the money to do that. Secondly, we only got thirteen percent sign-up in ACRE and that has soured a lot of people on a revenue target. I disagree with that; a revenue target will work. But ACRE was extremely complex. It was tied to the state level and then you had to give up twenty percent of your fixed payment. Washington needs to learn that farmers aren’t stupid. When you get done with all the rhetoric, what’s left there that will really put a safety net in there is a fixed payment, and it will be WTO compliant. Mark Twain read his obituary in the newspaper and said it was considerably exaggerated and premature, and I would liken that to the death of the decoupled fixed payment.
SD: You chaired the Congressionally-authorized 21st Century Commission on Production Agriculture and one of the issues it looked at was the impact of regulation on farmers. Dusting off one of his Freedom to Farm talking points, Senator Roberts made the comment in a hearing before Christmas that regulatory reform would probably be more important to farmers than billions more in the farm program. Do you share his view?
BF: Yes absolutely, and he will have to work with Senator Stabenow from Michigan and she just kind of made her maiden speech as the Chairlady and I couldn’t quarrel with it. One of the things in there was regulation and absolutely with the EPA that we now have and with the fact that they were given the authority through a Supreme Court ruling to regulate greenhouse gases, they’re going to do it. That could add fifty bucks an acre to producing a bushel of wheat in Kansas, rather an acre of wheat in Kansas. So, regulations are extremely important and you know, we’re saying to small business people, which is what farmers are, you need to expand, you need to invest. Well, how can you make an investment plan, when you have no idea what your taxes are going to be, you have no idea what your energy costs are going to be, you don’t know what your health care costs are going to be and you don’t have any idea what kind of rules and regs Washington is going to dream up?
SD: Dr. Barry Flinchbaugh, Extension Agricultural Economist and Professor of Ag Policy at Kansas State University. Dr. Flinchbaugh, thank you so much for joining us on Agri-Pulse Open Mic.
BF: Well I appreciate the opportunity and good questions. We pretty well covered it.
To listen to the audio of Stewart Doan's interview with Dr. Barry Flinchbaugh, click HERE.
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