Peterson hopes Senate will follow House farm bill's lead
House Agriculture Committee Chairman Collin Peterson (D-MN) met with his Senate counterpart, Senator Tom Harkin (D-IA) Thursday "to bring him up to speed on what we've done," Peterson said just before the meeting.
Peterson said he would encourage Harkin and his committee to adopt provisions of the House farm bill passed last week, including payment limits based on an income test and rebalancing of loan rates and target prices for some commodities.
"I'm hoping they're going to have a process that will get them fairly close to where we are so that the conference won't be so difficult," Peterson said. He was referring to a conference committee that will have to make one farm bill out of two separate bills passed by the House and Senate.
Earlier this week Harkin said that he has no plans to change loan rates in the commodity title of the new farm bill. Peterson said he planned to bring that up at the meeting. "I think he (Harkin) is going to have to deal with Senator [Kent] Conrad (D-ND) and others who have an interest in that," Peterson said of other members of Harkin's committee.
He also said that he thinks it will be difficult for the Senate Agriculture Committee to go further than the House on limiting payments to farmers. The House farm bill has a $1 million income test for commodity program payments and eliminates of the three-entity rule that allows farms to collect multiple payments that have hit the limit.
Peterson has said several times that ending the three-entity rule is a significant change in the farm program that wasn't popular with southern members of his committee. And in the future it will give more ammunition to reformers who have pushed for tighter limits in this year's farm bill.
"It'll make it easier for them to trace payments, it will make it more transparent," Peterson said.
He said that urban newspaper editorial writers and other critics outside of agriculture don't understand commodity programs, which provide a needed financial safety net for commercial farms that have big investments. "This is not a social welfare program," he said.
Instead, commodity programs and crop insurance provide a safety net that enables independent farmers to survive, he said. Without that safety net, "We're going to end up vertically integrating crop agriculture the way we've integrated meat agriculture," he said.
Peterson said that he believes the crop insurance industry can deal with the 2.9% cut in its administrative and operating (A&O) expense reimbursements from USDA that was passed in the House farm bill. Part of the money will pay to continue the global school lunch program. Because crop insurance premiums have risen sharply, the USDA has to pay higher reimbursements to the industry. Peterson said he doesn't believe the industry costs have risen as much.
"The GAO (Government Accountability Office) said to me yesterday they think we could take more out of A & O," Peterson told reporters. "The industry disputes that."