The Farm Bill, a piece of federal spending legislation focused on America’s agriculture industry, expired in late 2023. While previous Farm Bills have been quickly renewed, it’s almost half a year later, and Republicans and Democrats in Congress still haven’t come to an agreement on the final product, leaving many concerned about the various programs that depend on the bill passing. This matters to Kansas because it affects the state’s largest economic sector. However the bill turns out is going to affect thousands of families and the rural communities that they live in.
A rundown on the Farm Bill
The Farm Bill includes programs like crop insurance, SNAP benefits, and other support for agriculture across the country. The bill’s lapse is because Republicans and Democrats couldn’t right-size spending in the final product. Because of the importance of the bill to America’s farming industry, it’s likely that Congress will inevitably pass a new version, but the slow progress has top Congressional leaders pushing for more action.
Politically, the Farm Bill has been kicked down the road since Speaker McCarthy was ousted from his position, creating a backlog of several other spending bills such as aid to Ukraine and Israel.
Many Democrats dropped support of 2023’s Farm Bill out of disagreement with Republicans pushing for more work requirements for SNAP recipients. Republicans wanted to reduce SNAP, which currently consists of 76% of the roughly $428 billion spent through the 2018 legislation. With SNAP’s portion of the 2023 Farm Bill estimated to grow to 84%, this part of the bill is the most highly contentious. Long-term, agriculture support programs (i.e., crop insurance) have been paired with SNAP, the real name for what is commonly referred to as food stamps, as a political deal to get rural legislators/communities to support benefits for urban legislators/dwellers, and vice versa. However, these subsidies are wildly ineffective, “displace private methods of managing risk, and give subsidies to farm businesses that do not need them.”
Other legislators are still proposing new pieces of the bill. Senator John Hoeven of North Dakota wants the FARMER Act built into the farm bill so that there’s additional support for crop insurance at high coverage levels. That would cost $4.2 billion over ten years. Republicans want more subsidies on certain commodities such as peanuts, cotton, and rice – in part by cutting from $20 billion in climate funding for conservation programs. Democrats are unwilling to discuss reductions to SNAP benefits.
Until Congress passes some new Farm Bill, Kansan farmers still have access to the largest insurance programs, and SNAP benefits will still be available to those who qualify – because both are present elsewhere in the federal budget. But, many other, niche programs in the country’s agriculture or conservation portfolio are currently on hold.
So what’s next?
For Kansas, it’s an unpredictable wait for when the next Farm Bill is coming. The current stalemate is a reminder of what happens when both parties are unable to come to agreements about reducing spending and making bills more manageable.
Much of the Farm Bill’s subsidies are highly inefficient and simply give money to the largest and wealthiest of farmers. According to a report from the American Enterprise Institute, 20% of the largest farms in the country receive 80% of federal subsidies to purchase crop insurance. There are no caps and eligibility restrictions on these subsidies, with some millionaires and billionaires racking in federal cash. An absurd provision in the Farm Bill extends subsidies to family members engaged in farming: $125,000 in subsidies can be given out if a family member has one simple call with another about what to plant. This has resulted in almost 20,000 farmers receiving $18.5 billion in subsidies over the last 37 years.
The USDA’s $8 billion in insurance premiums cover an average of 62% of premiums, which results in farmers receiving money instead of just being covered for their expenses. Between 2000 and 2016, the CBO found that farmers received $65 billion more than they paid in premiums. No income limits and little transparency are riddled throughout the Farm Bill, yet Republicans still want to push more money into it without consideration of the waste.
On the flipside, SNAP has room to increase its efficiency and reduce wasteful spending without affecting the 42 million people it services.
Since 2019, the USDA has advocated for ending the categorical eligibility provision that creates SNAP eligibility if a person also qualifies for other welfare programs such as Temporary Assistance for Needy Families (TANF) or State Maintenance-of-Effort (MOE) funds. This drastically increases the number of people who can receive SNAP, often beyond the truly needy. A case in point is one Minnesota millionaire who enrolled into SNAP to demonstrate the loopholes. Other measures like reducing fraud, overhead program administrative costs, and other factors all add up to save billions of dollars. SNAP historically has struggled with sending money to efficient work training programs. After the 2014 Farm Bill, only two of ten pilot programs reported increased employment.
The point is that when both major political parties become advocates of big spending, the result is that taxpayers are the losers. We’re left footing the bill or never even seeing our tax dollars come back to us in some form.
Several other issues may also appear in the Farm Bill and are messages about how Kansas should (or shouldn’t) do its own policy. Pork producers want some way to address California’s Proposition 12, which requires strict conditions for pork sold in California. The proposition has ironically caused fresh pork supplies to decline by 8 to 10% while prices have gone up 20% because producers are unable to keep up with the demands. Regulations can sometimes have adverse effects on the populations they seek to help. The Farm Bill could potentially be expanded to limit this sort of intrastate problem.
Until something gets to President Biden’s desk and earns a signature Kansas farmers, SNAP recipients, and pork aficionados will be living with sort of uncertainty.
