WASHINGTON Crop insurance saves farmers from losses because of floods and other natural disasters. But as Congress weighs deep cuts to farm programs, does crop insurance itself need protection?
That is one debate likely to grow out of the budget proposed Tuesday by House Republicans and their Budget Committee chairman, Rep. Paul Ryan, R-Wis. In addition to broad reductions across domestic programs, Mr. Ryan aims to cut crop insurance even as many farm groups in New York and elsewhere say the government should boost it as an alternative to direct payments that appear likely to be eliminated.
The GOP plan would require farmers to pay a greater share of the premiums in government-sponsored crop insurance, an idea the Obama administration already proposed in its spending plan for fiscal 2013. Farmers pay 40 percent of premiums, while the government pays 60 percent; discussions focus on whether farmers should pay a greater share than the government, for instance.
Between the crop insurance cuts and the reductions in direct-payment subsidies, Mr. Ryans proposal slashes $33.2 billion from agriculture over 10 years. That figure is greater than either the Democratic-led Senate Agriculture Committee or the Republican-led House Agriculture Committee has endorsed, and the leaders of neither gushed with enthusiasm Tuesday.
In presenting his plan, the budget chairman said he would change the open-ended government support for crop insurance, which costs taxpayers about $9 billion a year, and make insurance for farmers more like insurance for other businesses. Critics of the program, including the Environmental Working Group, say it largely benefits the biggest farms and protects farmers income even when they do not suffer losses from adverse weather.
In New York, crop insurance is more important to growers of specialty vegetables and fruit, such as cabbage, grapes and apples, than to farmers who grow corn or other feed for dairy cows. The New York Farm Bureau has called for greater insurance protection for specialty crops, noting the program wasnt adequate in the aftermath of last summers heavy rains in the Hudson Valley and Southern Tier.
The bureau has urged lawmakers to take savings from direct payment programs and use them for crop insurance a top priority for the five-year farm bill Congress is drafting this summer, the group has said. And Sen. Kirsten E. Gillibrand, D-N.Y., a member of the Senate Agriculture Committee, has called for greater crop insurance protection for specialty growers.
In what may telegraph a general push by farm groups, the American Soybean Association immediately expressed reservations about the GOP plan, even as it praised the effort to reduce the federal budget deficit.
Crop insurance serves as the main safety net for Americas farmers, and its integrity must be protected, said Danny Murphy, first vice president of the Soybean Association, in a statement.
On the other hand, Mr. Murphy said, the GOP plan could speed consideration of the farm bill by subjecting it to the budget reconciliation process the same process Senate Democrats used to push though the Obama administrations health care law.
The National Farmers Union, while not addressing crop insurance specifically, warned the proposal would weaken the safety net for farmers and balance the budget on the backs of rural America.
The chairman of the House Agriculture Committee, Rep. Frank Lucas, R-Okla., said in a statement, I dont support every detail and proposed cut, but writing and passing a budget is the most basic function of governing and requires leadership and political courage from the president and Congress.
Mr. Lucas called both Mr. Ryans plan and President Barack Obamas budget only suggestions.
The ranking Democrat on the House Agriculture Committee, Rep. Collin C. Peterson, D-Minn., said the proposal all but guarantees Congress will not complete a farm bill this year. He said deep cuts to farm programs and to the supplemental nutrition assistance program, formerly called food stamps, are an appalling way to avert cuts in defense spending, which Mr. Ryan also aims to do.