Late yesterday, the U.S. House of Representatives passed the much-debated last-ditch, bipartisan deal struck Sunday to raise the federal debt ceiling and cut the budget deficit by a vote of 268-161. The Senate is slated to take up the bill today, with passage expected there, too.
The legislation includes about $10 billion in cuts to ag programs, but a spokesman for the National Milk Producers Federation told Dairy Herd Management the details are still sketchy and it’s too early to tell exactly how dairy and other commodities will be effected.
The dairy reform discussion draft released recently by U.S. House Agriculture Committee Ranking Member Collin Peterson, D-Minn., was not included in the budget deal.
“The mandatory ag programs like commodity programs and crop insurance dodged a bullet,” Mary Kay Thatcher, senior director of Congressional relations for the American Farm Bureau Federation, said Monday morning on AgriTalk radio. Instead, the $10 billion in cuts will come from discretionary funding, meaning areas like research and rural development will feel the pinch first.
But cuts to ag budgets (and all other facets of the federal budget) are far from over. The budget deal effectively just kicked the can down the road. A bipartisan group from the House and the Senate will continue working to slash the federal budget, with a plan to eliminate $1.5 trillion in spending due by the end of November. It’s unknown how much influence the House and Senate ag committees will have in this process.
For instance, “Direct payments are not cut now, but they are the low-hanging fruit and it’s unlikely that they will escape this process unscathed,” says Thatcher. “There are so many unknowns right now.”
One of those unknowns is the impact on the farm bill. Depending on the cuts, Congress will probably still write the farm bill in 2012. On the other hand, if these cuts are bigger than anticipated, the bipartisan panel will effectively write the farm bill this fall.
Only one thing’s for sure, says Thatcher. “More cuts are coming.”