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Red vs. blue which farm bill is for you?

House and Senate farm bill versions compared

By , Farms.com

The U.S. Senate and House agriculture committees recently approved their own versions of the five-year farm bill. Let’s take a glance at some of the key similarities and differences of the two proposed pieces of legislation.

COST: The overall cost of the two bills is roughly the same. Both would cost almost $100 billion annually, with the biggest chunk of the annual total going to domestic food aid - $80 billion. The difference is that the Senate bill would save roughly $2.4 billion yearly from current spending, while the House bill would save close to $4 billion, which would also include $600 million saved in each bill tied to the spending cuts that began last year.

FOOD STAMPS: The Supplemental Nutrition Assistance Program (SNAP), also known as “food stamps” has been attached to the farm bill for decades. The Senate bill would cut roughly $400 million from the $80 billion annual total, by targeting certain states that have small amounts of heating assistance so that they may qualify for higher food stamp benefits. The House bill would cut $2 billion yearly by eliminating certain categories like the broad-base eligibility, especially when people are signed up for other programs. 

DIRECT PAYMENTS: Direct payments, which cost close to $5 billion annually, will be phased out in both pieces of legislation. The savings will be divided up between other subsidy-type programs and deficit reduction. The subsidy portion has been a point of contention because of the model. Certain subsidies would be paid out yearly regardless of crop prices or yield. The Senate bill would eliminate the subsidy program entirely, while the House bill would phase it out over a two-year period, especially for cotton farmers who heavily rely on the program.

CROP INDUSRANCE: Both bills would increase subsidies for government subsidized crop insurance and create another crop insurance program that would cover smaller revenue losses. This new program would largely benefit Midwestern corn and soybean growers – the only difference is that it would be more generous in the Senate version of the bill.

PRICE PROTECTION: Both bills would raise target prices for certain crops. The subsidies operate in different ways. For example, certain subsidies would kick-in if prices drop below certain targets and those farmers would only receive subsidies if prices are low. These subsidies serve as a safety net. The House and the Senate versions would raise target prices for rice and peanut crops, largely because those types of crops depend on direct payments that would otherwise be eliminated. The difference between the two bills is this – the House bill would raise target prices higher than the Senate bill, which would make it easier for farmers to qualify for the subsidy kick in.

FOOD AID: While the Obama administration more recently announced a shift in aid to more flexible accounts, allowing cash purchases abroad or from U.S. farmers – neither bill includes the proposal to shift away from food aid sent abroad. Both agriculture committees have sided with the farm groups against the Obama administration proposal.
 


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