Soybean Farmers: What Safety Net Does This Budget Strengthen? Certainly Not Crop Insurance.

Oct 28, 2015

In response a statement today from House Ways and Means Committee Chairman Paul Ryan on a prospective budget agreement that will potentially cut more than $3 billion from the nation's crop insurance program, the American Soybean Association (ASA) countered that the proposed budget would weaken the farm safety net at a time when it is most needed.

"Chairman Ryan made the claim this morning that this budget deal would strengthen our safety net programs when the exact opposite is true,” said ASA President and Brownfield, Texas, soybean farmer Wade Cowan. “When he discusses strengthening the safety net, apparently we’re not talking about farmers.”

Specifically, the budget would make cuts to the federal crop insurance program in the form of a reduction on the rate of return for crop insurance providers to 8.9 percent, a decrease of almost a third. Also, while the bill exempts many spending categories from the mandatory 6.8 percent reduction under sequestration, it does not do so for farm programs. The combination of these cuts comes at a time when crop values are down more than 50 percent over the past three years, and key agricultural production areas across the country are struggling with the type of volatile weather events that lead to an increased need for crop insurance claims.

“It is unconscionable that after the House and the Senate Agriculture Committees put more than three years of careful work into creating a farm bill that protects farmers and actually brings budget savings to the table, Congressional leadership would strike a backroom deal that hobbles our risk management framework,” said Cowan. “The farm economy is cyclical, and to assume that the farm economy won’t notice a $3 billion hit is extraordinarily short-sighted on the part of this Congress”

Added Cowan, “We will continue to oppose any budget deal with this cut of our safety net included.”