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Vilsack Outlines Key Risks of Farm Bill Inaction

Vilsack Outlines Key Risks of Farm Bill Inaction
USDA Secretary expresses concern about trade retaliation and loss of market share

USDA Secretary Tom Vilsack Friday said negotiating a five-year farm bill should be a key priority for legislators as they return from August recess, citing loss of market share and trade issues that could come from continued inaction.

Vilsack expressed frustration at the process, which has taken more than two years to negotiate. The Senate, which has passed two new farm bills – one in 2012 and another this summer – now waits for the House to move forward with appointing a conference committee.

USDA Secretary expresses concern about trade retaliation and loss of market share

The House, however, chose to split the bill into nutrition provisions and farm provisions and has only passed the farm-only portion. Some pundits have speculated that the House will not move forward with appointing conferees until a nutrition portion is complete, though leadership has remained relatively quiet on the issue.

Trade issues

Vilsack says though the process has been long, one thing is for certain – without action, there's significant harm to be done on agricultural exports. He notes that the World Trade Organization cotton dispute settlement between the U.S. and Brazil could spell problems for recent historically high export numbers.

Brazil, which protested American agricultural policies on cotton, now receives payments to forestall its retaliation against American goods. Vilsack explained, however, that after Oct. 1, the U.S. will no longer make the payments. That could mean export losses to the tune of $850 million annually.

"That's going to put our agricultural producers at a very serious disadvantage in that market, and once we lose market share if those retaliation measures are taken, we will have a hard time taking it back," Vilsack said.

Vilsack estimates that elimination of promotion programs, also on the chopping block without a farm bill, will result in significant loss of market share. Specific programs that could lose funding include the Market Access Program and the Foreign Market Development Program.

"We will be hampered over the course of the next several months this fall in terms of being able to do the aggressive promotion of American agricultural products – and that will jeopardize our ability to reach out to markets all across the world," Vilsack said.

Extension isn't the answer

Vilsack stressed that even with the problems the lack of a farm bill creates, an extension isn't the way to go. He suggests that not only will an extension not cover changes in direct payments, it will also not include disaster assistance or solve the Brazilian trade issues.

"Producers are getting more and more frustrated that with this notion that Congress only has nine working days in September – farmers and ranchers are working 30 days in September. They are working around the clock to get the work done and they expect their elected officials to do the same," Vilsack said.

Now, adding stress to the situation is Congress' new worry – Syria. Vilsack said rural America has a big stake in whatever decision Congress makes, considering many service members are from rural communities. That could also be a reason to renew focus on the farm bill.

"Once (military members) serve this country admirably and bravely and faithfully – we owe them the opportunity to come back to their home towns, to their farms and ranches with a farm program that will continue to support their families and continue to support opportunity in rural America," Vilsack said.

"It's hard to say, 'Folks, please put yourself in harm's way and by the way when you come back we just haven't found the will or the way or the time to get a farm bill done.' It's an unfortunate message."

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