Page 59 - Farm Bill Series_The 7 Things You Should Know

• Cotton growers wanted the Stacked Income Protection Program (STAX) whereby
farmers could buy insurance coverage to protect against shallow losses under an area-
wide insurance product with a fixed minimum harvest prices – in addition to a farmer’s
individual insurance policy.

• The U.S. Rice Producers argued against a one-size fits all approach to risk management,
suggesting that crop insurance was not workable. They wanted a price support program
that fit the unique needs of their farmers.

• Rep. Randy Neugebauer, R-Texas, introduced the Crop Risk Options Plan (CROP) to
enable farmers who bought insurance to supplement coverage with an area-wide
insurance plan to cover shallow losses.
• And dairy programs were up for reform, too. Rep. Collin Peterson, D-Minn., and others
offered the Dairy Security Act of 2011, which would eliminate current dairy programs in
favor of a voluntary margin insurance program and market stabilization plan.

Ideally, all of these different “reform” options would come up for discussion and debate in the
House and Senate Committees on Agriculture. Instead, they became the backdrop for the so-
called “Super Committee” process where committee chairs worked in secret to meet deficit
reduction goals. Ultimately, Stabenow and Rep. Frank Lucas, R-Okla., who chaired the House
Agriculture Committee, proposed a package that cut $23 billion over 10 years, with $13 billion
from commodity supports, $6 billion from conservation and $4 billion from nutrition programs.

The final details of the Super Committee plan were never
that corn and soybean growers got much of the revenue-
guarantee program that they were looking for. Southerners
got a price guarantee-option that they wanted, and cotton
growers got STAX.

After that process failed, some thought that the parameters
were already established in terms of where the policy
would eventually end up.

“Many of us assumed the cake was already baked,”
recalled one source on the way future policy would
develop after the Super Committee failure. Others saw the
Super Committee’s failure as a chance to start over and
write a bill the “old-fashioned” way. And what they lacked
in the super-committee negotiations, they wanted more of
in the next round.

Corn and soybean growers rallied behind a shallow-loss
Former House Ag Chairman Frank
Lucas risk management program that eventually became known
as the Agriculture Risk Coverage (ARC) program. Rice and peanut growers were more
concerned about longer-term price risk and advocated for a program that paid when prices fell
below a certain “reference price” level.

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