You Make the Call: To Subsidize or Not? U.S. Farm Policy: 2007 Farm Bill Debate

1. You Make the Call: To Subsidize or Not?U.S. Farm Policy: 2007 Farm Bill Debate Dr. Mark A. Edelman, Director Community Vitality Center Professor of Economics and Extension Economist Iowa State University Leadership Iowa Farm Bill Panel December 6, 2007

2. How Public Policy Problems are Different • Key Differences: • Group Rather than Individual Decisions • People Have Different Circumstances • People Hold Different Values on What Should Be • People Differ in Goals and Objectives • Conflicting Views on What Ought to be Done

3. Advocate vs Educator • An Advocate believes they have the best solution to a problem, tries to convince others, and encourages others to support their cause in the political process. • An Educator enhances learning and understanding, assists others in making their own decisions, and facilitates participation in the process

4. Science Can’t Always Solve Problems • Science solves problems when • Single objective and relatively few goals • Objective is clearly revealed and measurable • Everyone in group agrees with objective & goals • Public Policy Issues have • Multiple objectives and goals • Objectives that are unknown or not revealed • Differing value judgments on what should be done • Science is only a decision tool

5. Role of Public Policy Educators in a Democracy • Present Facts (evidence of what exists) • Destroy Myths (incorrect notions that people believe are facts) • Allow citizens & leaders to apply their own values • Facilitate understanding of areas of agreement & differences • Facilitate participation in process

6. Edelman’s Top 10 • Farm Bills are temporary extensions of 1940s era permanent farm law • Farm Bills are the way they are because they are written by the Ag Committees

7. Senate Members - 21 North Central - 11 IA, ND, MI, NE, OH, MN IN, KS, MN, SD, IA South - 5 AR, GA, MS, KY, SC Northeast - 2 VT, PA West - 3 MT,CO, ID House Members - 46 North Central - 18 MN, IA, SD, IN, KS, OH, MN, WI, ND, IN KS, IL, MO, IA, NE, OH, NE, MI South - 19 NC, NC, GA, GA, TX, TN, GA, TX, FL VA, AL, OK, NC, AL, AL, TX, LA, NC, TX Northeast - 3 PA, NY, NY West - 6 CA, CA, CA, CO CO, CA Who Sits on the Ag Committees?

8. Edelman’s Top 10 3. The Farm Bill coalition has changed over time: • Farm Bloc in 1930s • Food programs added in 60s • Environment & Rural Development in 70s 4. About 75% of Farm Bill spending is food programs

9. Edelman’s Top 10 5. Farm Bill spending has increased as farm numbers have declined. • Some suggest less farmers less clout • Others: fewer farmers easier to organize 6. Market oriented system with a safety net and increasing incentives for multifunctional objectives • Environment & water quality • Renewable Energy

10. Edelman’s Top 10 7. U.S. Food & Ag System is one of few remaining industries where dispersed family operations sell into a much more concentrated processing and distribution system that also relies on international markets where significant protectionism has existed since prior to WWII. 8. Iowa relies more on Ag’s contribution to the state’s economy than almost all other states except perhaps the Dakotas • 25% of Iowa GDP

11. Edelman’s Top 10 • U.S. Farm Safety Net provides $2 billion injection into Iowa’s economy when times are bad. • No other state benefits more: 4-5% of GDP • So question is What to do with Budget Baseline if it does not go to Farm Supports? • If $2 doesn’t come to Iowa, where will it go? • Do we elect Iowa Delegation to keep score? • Maybe the Iowa debate is not whether or not there ought to be farm subsidies, but what form should the safety net be to achieve multiple farm and nonfarm objectives. • Start with Farmer Preferences

12. Knowing Farm Bill Processes • Troika (3 horse hitch) • Interest Groups (Ag, Environment, Food, & Rural Dev) • Executive Agencies • Congressional Committees • Legislative Process • Leadership Control (Majority Rules) • Content Control (Authorization and Oversight) • Budget Control (Appropriations) • Best Practices for Communication & Building Relationships

13. The Farm Bill Legislative Process • Administration Hearings and Proposals • Ag & Ag Approps Committee Assignments (Leadership) • Budget Targets and Appropriations (Budget) • House & Senate Ag Committees (Authorization) • Subcommittee Hearings & Proposals • Markup to Committee Proposal • Floor Debate • Passage by Both Houses • Conference Committee to Iron out Differences • Concurrence by Both Houses • Presidential Signature or Veto

14. Funds Available Senate Target: • Tax Revenues for increasing targets Baseline • Revenue Insurance Pilot versus Disaster Assistance • Number of Amendments House Target: • $15 billion over 5 years above Baseline

15. CVC Web Site: www.cvcia.org 2007 Farm Bill Issues and Resources • Iowa Farmer Preferences on 2007 Farm Bill Issues (PDF file) • The 2007 Farm Bill: U.S. Producer Preferences, 2006 • USDA 2007 Farm Bill Page • Senate Committee on Agriculture, Nutrition and Forestry • House Agriculture Committee Policy Centers specializing in Farm Bill Issues Analysis • CARD (Iowa State University) • Agriculture and Food Policy Center (Texas A&M) • Agricultural Policy Analysis Center (University of Tennessee) • Food and Agricultural Policy Research Institute (Missouri) • Rural Policy Research Institute (Missouri) • Farm Foundation (Chicago) Extension Public Policy Education Principles • Public Policy Education by Richard Barrows (PDF file)