By Natalie Conrad
Herald Staff Writer and Associated Press
A potential doubling of milk prices is to be averted as part of the compromise that White House and congressional bargainers reached on wide-ranging legislation to avert the “fiscal cliff,” a leading senator said late Monday.
Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., told reporters that negotiators had agreed to extend portions of the expired 2008 farm bill through September. She said that includes language keeping milk prices from rising, but excludes other provisions like energy and disaster aid for farmers.
Stabenow said she considers the slimmed-down extension to be “Mitch McConnell’s version of a farm bill.” She was referring to the Senate Republican leader from Kentucky, who she said forced bargainers to accept the version of the farm bill that appeared in the deal.
McConnell spokesman Michael Brumas responded: “Sen. McConnell put forward a bipartisan, responsible solution that averted the dairy cliff and provided certainty to farmers for the next year without costing taxpayers a dime.”
Just a day earlier, Stabenow said leaders from both parties on the House and Senate agriculture committees had agreed to extend the entire farm bill.
Stabenow and House Agriculture Chairman Frank Lucas, R-Okla., announced Sunday that they had agreed on a last-minute move that would extend the entire farm bill and replace dairy programs that expire at midnight Tuesday.
Expiration of those dairy programs could mean higher milk prices at the grocery store within just a few weeks. But the House GOP had not endorsed the committees’ extension agreement.
The nonpartisan Congressional Budget Office estimated Sunday that extending the entire bill through September, including disaster assistance for farmers affected by drought, could cost more than $1 billion this budget year.
Local farmers and dairy officials had been on the edge of their seats as they waited for the House and Senate Agriculture committees to come to an agreement to extend the Farm Bill.
“There is really no short term or long term planning that can get done, with something as huge as this in the air,” Iowa State Extension Farm Management Specialist Jim Jensen said.
Expiration of those dairy programs could mean higher prices at the grocery store within a few weeks. Agriculture Secretary Tom Vilsack said Americans faced the prospect of paying $7 for a gallon of milk if the current dairy program lapsed and the government returned to a 1948 formula for calculating milk price supports.
This same parity concept would also affect many other produce including Iowa’s top crops, corn and soybeans.
“There are a lot of things in speculation, making it hard for us to move forward,” Clinton County Cattlemen’s Association President Loren Truelson said. “They need to make a decision, so we can make decisions.”
House Speaker John Boehner, R-Ohio, has pushed back on passage of a new five-year farm bill for months, saying there were not enough votes to bring it to the House floor after the House Agriculture Committee approved it in July.
The Senate passed its version of a farm bill in June.
The bill, generally passed every five years, includes food stamps, farm subsidies and other help for rural areas.
But the prospect of higher milk prices prompted some action.
Extending the entire agriculture bill would have included an overhaul of dairy programs that was included in both the Senate and House committee bills.
The new dairy programs include a voluntary insurance program for dairy producers, and those who choose that new program also would have to participate in a market stabilization program that could dictate production cuts when oversupply drives down prices — an idea that hasn’t gone over well with Boehner.
In July, he called the current dairy program “Soviet-style” and said the new program would make it even worse.
Large food companies that process and use dairy products have backed Boehner, saying the program could limit milk supplies and increase their costs.
One of the reasons Boehner has balked at bringing up a farm bill is disagreement among House Republicans over how much money should be cut from food stamps, which make up roughly 80 percent of the half-trillion-dollar bill’s cost over five years.
Lucas has unsuccessfully pushed his leadership for months to move on the legislation despite the disagreement over food aid.
Now that decisions are being made, the work is not done for local farmers and educators as they will have to adjust to the changes.
“Once they come up with something, I will be busy explaining it to people,” Jensen said.