WASHINGTON — Unable to agree on whether millionaires should be taxed more, Democrats and Republicans are in rare accord on one issue: Growers with million-dollar incomes shouldn’t reap farm subsidies.
In an emphatic vote early Friday, 84 senators voted to discontinue certain farm subsidies for people who make more than a million dollars in adjusted gross income. The practical impact of the vote may be marginal — current limits are about $1.2 million at most — but it represents a sea change in how the heavily rural Senate views farm support. In recent years, many votes to limit subsidies have failed in the Senate.
“I do think sentiment has changed,” says former Sen. Byron Dorgan of North Dakota, a Democrat who pushed for years to lower subsidy limits. “When they are under this much pressure to cut spending they have to take an honest look at what’s happening, and you can’t justify direct payments under these circumstances.”
Direct payments, the type of subsidy targeted in Friday’s vote, have long been criticized because they are paid regardless of crop prices and yields, unlike other more insurance-like programs that kick in when prices drop or crops are damaged.
As lawmakers prepare for a new five-year farm bill in 2012, leaders of the House and Senate Agriculture committees are looking at getting rid of direct payments altogether, shifting some of the aid to insurance programs that cover falling prices and revenue drops.
Republicans and Democrats on the Agriculture panels have already jointly proposed cutting $23 billion from farm programs over 10 years — almost half of the $50 billion that direct payments cost over that period. They sent the idea to the budget-cutting supercommittee, hoping to head off even greater cuts in next year’s farm bill. Some lawmakers have suggested writing the entire farm bill as part of the supercommittee process.
The ag leaders have promised more details by the end of October on how they will achieve that number, but eliminating direct payments completely is a leading scenario.