Farm groups will be hard-pressed to avoid cuts in the federally subsidized crop insurance program during work on the 2018 farm bill, said lobbyists from the two largest U.S. farm groups. One of the lobbyists, Mary Kay Thatcher, of the American Farm Bureau Federation, said her analysis of lawmakers’ leanings suggested it will be easier to persuade Congress to pass the farm bill than to stop amendments that cut crop insurance.
Thatcher told the North American Agricultural Journalists that she expects a reprise of Sen. Richard Durbin’s amendment to require the wealthiest operators to pay a larger share of crop insurance premiums. The Senate approved the idea, 66-33, for the 2014 farm bill, but it was deleted during House-Senate negotiations for the final bill.
“It will be difficult to defeat,” said Thatcher, who said the Senate still contained 40 supporters of the Durbin amendment and 22 opponents. The government pays an average 62 cents of every $1 in premium for crop insurance. Durbin wanted to reduce the subsidy to 47 cents per $1 for farmers with more than $750,000 in adjusted gross income.
While crop insurance is a target, a large number of lawmakers, based on past votes, would support a farm bill that has a strong safety net for farmers and treats public nutrition programs fairly. “If you want a farm bill, you have to keep the two married,” said Thatcher. She cautioned, “You can’t do much about food stamps without losing votes.” In 2013, the House defeated a farm bill for the first time ever because Tea Party Republicans wanted the largest cuts in food stamps in a generation.
Thatcher and Zach Clark, of the National Farmers Union, said they anticipate new attacks on the so-called harvest price option on revenue insurance policies. Critics say the option generates windfall payments because indemnities are paid at the harvest price, which is higher during crop disasters than the price guaranteed at planting time, when policies are purchased.
Clark said he expects language to curtail the harvest price option will be part of the Trump administration proposal for cuts in mandatory spending for fiscal 2018. The White House already proposed a 21-percent reduction in USDA discretionary spending. “I think there will be a lot more cuts [proposed] in crop insurance,” said Clark.
Reformers have pressed ideas such as limiting the amount of premium subsidy that the government will provide to a farmer, or requiring growers to pay a larger share of the premium for policies with the harvest price option.
Cotton and dairy groups hope to include language in a government funding bill this week that will raise the budgetary baseline for their programs by $3.5 billion over 10 years. “I think that is a little bit up in the air yet,” said Thatcher. The additional funding is essential for strengthening the support programs. Subsidies for both commodities were converted to insurance-like programs in the 2014 farm bill, but have proven inadequate.