December 30th, 2012
09:14 AM ET
1 year ago

Vilsack: Economy will suffer without farm bill

Update 4:30 p.m. ET: Following increased pressure to pass farm legislation by the end of the year, Democratic Sen. Debbie Stabenow said Sunday that the House and Senate have developed a short-term farm bill extension to prevent dairy prices from soaring in the new year.

The bill "also prevents eventual damage to our entire agriculture economy," Stabenow, who chairs the Senate Agriculture Committee, said in a statement.

Rep. Frank Lucas, Stabenow's Republican counterpart in the House, said the extension would last one year, but GOP leadership aides tell CNN there has been no decision on whether to bring the stopgap measure for a vote by January 1.

(CNN) - While Congress faces escalating pressure to avoid the fiscal cliff, a key Cabinet member is issuing dire warnings for the economy if Washington fails to immediately act on other vital legislation waiting in the wings.

"It is unconscionable that we don't have a farm bill," U.S. Secretary of Agriculture Tom Vilsack said in an interview that aired Sunday on CNN's "State of the Union." "This is just historic."

The five-year farm bill, which aids farmers with price protections and subsidies, expired on September 30 after the House faced GOP division over extending the bill. Some conservative lawmakers said the newer version didn't go far enough in reform, while others said the price tag was too high, especially in provisions dealing with food stamps.

House Speaker John Boehner said in September that the chamber would readdress the issue after the election.

The recent expiration doesn't affect existing federal support for the remainder of 2012, but Vilsack cautioned that Americans could see stark changes come 2013.

"When you consider what rural America does: It provides most of the food, a lot of the water, almost all of the energy and fuel as well as many, many jobs connected to what happens in rural areas," Vilsack told CNN Chief Political Correspondent Candy Crowley.

Consumers, for example, could see a sharp increase in the price of milk–almost double current prices–if Congress doesn't act by January 1, when the dairy subsidy expires, or shortly thereafter, Vilsack said.

The reason: If a new bill isn't passed or the most recent one extended, the formula for calculating the price the government pays for dairy products defaults back to a 1949 statute. Under that formula, the government would be forced to buy milk at twice today's price - driving up the cost for everyone, CNNMoney reports.

The absence of farm legislation will also hurt agricultural exports, farmers markets, hunting grounds and farming families, Vilsack added. "Across the board, in virtually every aspect of our economy and society, there is an impact."

And Vilsack, who previously served two terms as Iowa governor, plans to see it through. Asked if he intends to stay on during President Barack Obama's second term, he said he's "absolutely" happy to keep his job if he can.

"I'm here as long as the president's pleased with my service. At least that's what the certificate says," he said. "I've got a great job and I'm privileged and honored to have it."

Vilsack's wife, Christie, challenged incumbent Rep. Steve King for his Iowa seat this year but failed to defeat the longtime Republican congressman. King was recently chosen to chair a House subcommittee that has oversight power over the Agriculture Department.

– CNN's Alan Silverleib and CNNMoney's Steve Hargreaves contributed to this report.

Watch State of the Union with Candy Crowley Sundays at 9am ET. For the latest from State of the Union click here.

soundoff (49 Responses)
  1. Gurgyl

    Yes, this Agriculture is the main epitome of this nation's progress. It needs to have subsidies. Farmers are suffering while we are pouring millions, shhh, perhaps trillions on needless wars in Iraq, Afganistan. Encourage farming which is totally neglected. Two good reasons–people eat veggies, drops the price, and stay healthy–less hospital costs to happen. God bless!!!

    December 30, 2012 09:22 am at 9:22 am |
  2. plain&simple

    Keep electing tea party extremists who hate government who hate to govern but love their paycheck....paid to them by the government! There's a sucker born every minute and whoever votes for these clowns needs to take a long look in a mirror. Send the tea party clowns home to their districts and let them learn how to work for a living and be productive!

    December 30, 2012 09:40 am at 9:40 am |
  3. msadr

    What hurts farmers more is the estate tax. Which brings us back to the taxes they are currently debating.

    December 30, 2012 09:49 am at 9:49 am |
  4. wm Scot

    Quit subsidizing corporations ! These bills were fro the small famer not the huge agri corpoations that are owned by the subsidized oil comapnies and alike !

    December 30, 2012 09:51 am at 9:51 am |
  5. sundownr

    I agree, farmers need help, but I do not understand why milk needs to double in price under any circumstance. This part sounds like political chicanery.

    December 30, 2012 10:01 am at 10:01 am |
  6. penguin

    It amazes me that farmers vote overwhelmingly in favor of Republicans while being the recipient of more government subsidies than any other enterprise. I guess welfare for them is alright, but subsidies for any one else is socialism

    December 30, 2012 10:03 am at 10:03 am |
  7. imrightalways

    Um that was three but it's Sunday fun day so be drunk. And ah Iraq is done granted we still have commitments but hey and afgan not pricey comparatively but we will be free from them in a year but the true cost is supporting the few hundred thousand soldiers but hey we know that doesn't happen so no more cost soon
    Next point please

    December 30, 2012 10:04 am at 10:04 am |
  8. john

    I can't believe decision makers in Washington can't even pass a legislation that would avoid this nonsense and will affect us all. I'm starting to think they are doing it on purpose or just don't care about the rest of the country. They seek after their own riches and careless about the poor.

    December 30, 2012 10:05 am at 10:05 am |
  9. chet

    Wait a minute – if there is no bill the farmers will get paid more for their milk? Price control on milk by the government gives the farmer nothing for milk, per hundred weight and fat content is how they get paid. You get a gallon of milk for about what a farmer gets for a hundred weight.
    Pay the farmers more!

    December 30, 2012 10:07 am at 10:07 am |
  10. guest

    Drop all subsidies for large scale monoculture farming operations.

    December 30, 2012 10:07 am at 10:07 am |
  11. cj

    Gurgyl...do you realize the farming bill spends billions on paying people not to grow crops so the price stays high? Yes, think about it... with record high (adjusted for inflation) food prices, high unemployment, record under employment and as proof of the under employment record numbers collecting 'food stamps' we continue to pay tax dollars to make sure we have less and the price is high. Making healthy food harder to afford.

    They are a boondoggle nothing more as a matter of fact many people collect part of these subsidies for 'not farming land' that they had no intention of ever farming. All you need is to buy land that is zones as farm or mixed farm land and you can collect.

    The milk subsidy is again an amazing piece of legislation that shows our politicians have been busy being useless for the last 60 years. Prices double because the government is bound by an outdated grantee to pay 2x the current market price? No one thought this should have been changed long before it was about to expire?

    IMO the agriculture bill can expire and then after the 'fiscal cliff' is averted a new agriculture bill that cuts spending on it by 20% now and 50% over the next 10 years should be carefully constructed.

    December 30, 2012 10:07 am at 10:07 am |
  12. Jane McDonald

    Vilsack's support for corporate agriculture and GMO crops has made him significant a liability to the legacy of the Obama Administration. The farm bill currently includes a rider giving Monsanto protection to plant GMO crops whether or not they have been approved legally.

    December 30, 2012 10:08 am at 10:08 am |
  13. Charlotte

    when he says "rural America" what he means is giant agribusiness.

    December 30, 2012 10:08 am at 10:08 am |
  14. Daddy Rabbit

    So, farmers are small businesses. We are to continue the socialist drill of paying them to farm or not to farm? So, milk prices increase. Well, so does gas and meat. Let people pay more for milk if that is what the market is. Don't worry about farmers, they will be unhappy regardless of what Congress does. But them off from our subsidies.

    December 30, 2012 10:09 am at 10:09 am |
  15. Buddha

    Please let the market determine prices. Stop subsidies let people starve because they can't afford to eat. Take away food stamps let them eat cake.

    December 30, 2012 10:09 am at 10:09 am |
  16. Jim McDowell

    The reason they won't deal with it has to do with the food stamp concerns. The tea party (I won't use capitals) thinks they are a useless handout to lazy people, so in the meantime the country goes to hell.

    December 30, 2012 10:11 am at 10:11 am |
  17. Buddha

    Please let the market determine the prices. Get rid of food stamps! Let them eat cake.

    December 30, 2012 10:11 am at 10:11 am |
  18. Tony

    Msadr, the estate tax kicks in only when a person dies and he has an estate that is big enough. Even if we go back to pre-2001 law next year, a person still has an exemption of 1 million dollars. Do you really think that the biggest problems for farmers are that they are dying and their estates are too big?

    December 30, 2012 10:13 am at 10:13 am |
  19. annieL

    The American people and those they elect to Congress have forgotten the basic things of life: food, water, and healthcare. Those are the FIRST things our government, as the representatives of our national values, should spend our tax dollars securing for ALL. Our economic and political systems create incredible wealth from our natural resources, technology and human intelligence and labor so there is no excuse for us not to provide those basics of life to all citizens. To pretend that we are "broke" and "can't afford" to do this is immoral. Certainly, there are abuses and greed at all levels, top to bottom, of this "food chain" of subsidies and benefits and those should be rooted out. But it's time to get our priorities straight. Stop looking for budget cuts where we spend on the basics of life: food, water, healthcare.

    December 30, 2012 10:14 am at 10:14 am |
  20. Dan

    I don't know what farmers he is talking about. I live in Iowa, and it's never been a better time to be a farmer. Grain prices are VERY high, and have been for several years. The farmers that I know (including my father) are making more money than they have ever made....by FAR!!!

    December 30, 2012 10:16 am at 10:16 am |
  21. fredeferg

    The three things that need to be cut and that Republicans will never talk about are 1) wasteful defense spending, 2) Agricorporate welfare and subsidies and 3) entitlement (Social Security and Medicare) payments to the rich. I say phase out all farm subsidies now!

    December 30, 2012 10:25 am at 10:25 am |
  22. Ron

    John said "I'm starting to think they are doing it on purpose or just don't care about the rest of the country." I agree completely. I am convinced our Congressional people create all these crises just so they can look like heroes riding to the rescue at the last minute. Responsible people address problems as they occur. Successful people never get to the crisis stage.

    December 30, 2012 10:25 am at 10:25 am |
  23. Squigman

    I seem to remember when in econ.101, that the prof. talked about the free market, where demand set price. This has not been the case in many industries. Agriculture, Big Oil, or almost any other industrial based economy. While we've increased the M.P.G. on autos, the oil companies have increased prices for product. Seems like the tail wags the dog more, and more.

    December 30, 2012 10:27 am at 10:27 am |
  24. fredeferg

    I say cut wasteful defense spending, farm welfare and entitlement payments (Medicare and Social Security) to the rich right now. I would phase out all Agricorporate welfare right now. Farms are less than 3% of the US workforce and yet we treat them as if some how they are special. They pollute the environment, hurt developing countries and most of the profits end up in the pockets of right-wing death stars like Monsanto who put Tea Party nut bags in office. END FARM WELFARE NOW!

    December 30, 2012 10:28 am at 10:28 am |
  25. Rina

    In my state of Indiana, there was a record profit this year for farmers – even with the drought. We need to end these farm and oil subsidies – or at least revamp them. Ted Turner is given subsidies for his Buffalo ranch. Same with Sam Donaldson's ranch – he was getting it too. Does anyone else feel the need for gazillionaires to get farm subsidies?

    December 30, 2012 10:29 am at 10:29 am |
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