D.C. Debt Battle Could Affect Farmer Incomes
The debt ceiling discussions in Washington, D.C., are starting to hit closer and closer to home.
Lawmakers are looking at slashing $30 billion in agriculture spending. Those federal dollars are only a small portion of their annual revenue.
Local economists said how hard farmers are hit will depend on what they grow and where.
Looking out on his Idaho Falls wheat and barley fields, Scott Steele said he’s willing to forgo federal farm dollars if it means settling the debt crisis in D.C.
?It would be substantial, but like I said if it meant solving some of the problems in Washington, I think most people would be willing to do it,? Steele said.
The possible $30 billion cut from agriculture spending would come in three different areas: direct payments, which are tied to specific crops like corn, soybeans, barley and wheat; crop insurance, for disaster relief; and conservation money to protect environmentally sensitive land.
?Farmers are risk takers,? Steele said. ?If they weren’t they wouldn’t be farming, that’s just it.?
Agricultural economist Paul Patterson said in 2010, the direct payments contribution to net farm income was 15 percent in the United States, but only 9 percent in Idaho.
?So we’re less dependent on some of these program payments than other states, but it’s still not insignificant, especially for some producers,? Patterson said.
?It isn’t really an important part of our operation as far as my income goes,? Steele said.
Patterson said there’s been a downward trend in agriculture funding since around 2000. As long as change is gradual, farmers should be able to adjust business plans accordingly.
But, he says, it will hit the smaller, more rural communities the most.
?Is Idaho Falls going to be impacted as some smaller areas? No, but look at more agriculture-dependent communities, talk about Blackfoot or Shelley and you see ag because that?s where the jobs are,? Steele said.
Potatoes are not a program crop, so farmers don’t get direct payment for growing them.
Patterson said, at least in the short term, consumers should not see any increase in food prices.
The next farm bill is due in 2012, which is an election year. Experts said as available money shrinks, it will become more and more problematic to write the bill.
