Farm bill scheduled for House tomorrow — Bush will veto, says Ag Secretary

Today Secretary of Agriculture Mike Johanns said that the President may veto the 2007 Farm Bill, scheduled for full House consideration tomorrow, because it doesn’t include significant reforms in subsidy programs.

The Administration had proposed its own Farm Bill with modest reforms, which didn’t get support in Congress, mainly because farmers exerted their clout with their powerful legislators not only to continue farm subsidy programs but also to expand those programs and provide them to growers that hadn’t received subsidies before.

The bipartisan bill, H.R. 2419, has a lot of pork to satisfy farmers’ demands. All but the very rich farmers — those with adjusted gross income of over $1 million per year– can continue to collect their subsidy checks. To placate big-city politicos, the bill also includes expanded nutritional and food stamp programs. But to finance those a controversial new tax on foreign businesses with U.S. subsidiaries has been proposed.

There may be some lively action against the bill on the House floor. A host of amendments will be offered — the most significant overall will be those of Reps. Ron Kind (D-Wis.) and Jeff Flake (R-Ariz.), who — with some like-minded colleagues — are trying to change the bill by cutting back on support programs and shifting more funds to nutrition, conservation, and rural development. Here’s a July 20th summary from their “Dear Colleague” letter:

· Reduces Direct Payments. These payments were meant to be temporary but instead have driven up rent and land value in farm country, pricing new and small farmers off the land.

· Adopts the Administration’s revenue-based Counter-Cyclical Program proposal. The Committee provided a similar, voluntary option. This amendment will make this mandatory, ensuring the program pays when farmers need it most.

· Adjusts the Marketing Loan Program. These reforms will make it harder to game the system. This mirrors an Administration proposal.

· Imposes tighter AGI limits and payment caps. This will ensure that government handouts do not go to the wealthiest few.

· Establishes voluntary, incentivized Risk Management Accounts (RMAs). Farmers will have the opportunity to use RMAs as an additional tool to manage their risk.

· Takes the fat out of the federal crop insurance program. This program was established to help farmers cope with loss, not allow a few insurance companies to reap huge profits at government expense. These changes will not affect farmers, but will make sure taxpayer dollars are spent wisely and efficiently.

Amendments to rein in the egregious sugar program are expected to be introduced by Reps. Danny Davis (D-Ill.) and Mark Kirk (R-IL).