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A state farm official says a possible new farm bill may cut all areas in the U.S. farm safety net.
Ohio Farm Bureau Federation President Adam Sharp, who spoke in great length at the Auglaize County Farmers breakfast on Tuesday, provided a history and the affects the farm bill would have on Ohio farmers. The current farm bill, written in 2007, is set to expire at the end of 2012. Sharp said the committee could potentially cut the entire farm bill.
â€śThere is a general belief that we are heavily subsidizing farmers and it simply isnâ€™t true,â€ť Sharp said.
He provided a chart showing the U.S. second only to Australia of all farming nations in amount subsidized at 9 percent.
Cuts to programs in the next farm bill would likely lead to the U.S. needing to depend on foreign food sources.
â€śWe have seen what happens when we depend on foreign oil,â€ť Sharp said. â€śWe do not want to depend on foreign food suppliers.â€ť
Sharp said the federal farm programs help keep the industry stable in a market where it has a tough time competing. The average of government subsidies for farming in foreign countries is 22 percent and many countries are well above 50 percent, as compared to the 9 percent in the United States.
Americans currently spend 10 to 12 percent of their income on food and would likely see that number increase immensely with drastic cuts.
â€śFarm safety net programs are essential to traditionally family-owned farms,â€ť Sharp said. â€śNinety-eight percent of our farms are family-owned farms. They are not so-called factory or corporate farms.â€ť
Sharp said Democrats and Republicans agreed to extend the federal governmentâ€™s debt ceiling in exchange for a deal to cut $1.2 trillion from the federal budget if no deficit and debt reduction plan could be reached by the first part of December. That budget agreement could put the squeeze on farmers nationally as cuts are made via the deal.
With the current farm bill set to expire at the end of 2012, Sharp said Congress could potentially cut the entire farm bill.
Republican U.S. Sen. Rob Portman is a member of the Supercommittee that discussed the cuts, which had to be agreed upon prior to the December recess. Anything not in place was to face automatic spending cuts across the board in 2013.
Priority programs facing cuts in Ohio include the Average Crop Revenue Eligibility Program (ACRE), crop insurance, several conservation programs, and Milk Income Loss Contract (MILC).
Sharp said while legislators are looking over farm bill cuts, cuts to the bill would have little impact to the overall budget since 2 percent of the federal budget is spent on farm programs.
He also addressed food safety regulations and their affect on the national and state economy. If U.S. policy results in more strict food safety guidelines, as many as 1,000 Ohio food processing companies and as many as 1 million Ohio workers, could be out of jobs.
He also noted approximately 75 percent of the current farm bill goes to food stamps, school lunches and other food and nutrition programs.
Despite taking up only 2 percent of the budget, farmers realized cuts in federal assistance when the farm bill suffered huge cuts in 2002 and 2008.
â€śIt is a part of the spending that goes a long way and is such a very small part of the budget,â€ť Sharp said. â€śIt is not the area they want to focus on.â€ť