Inside the freshly harvested Farm Bill with Vilsack

The meat of the recently-passed farm bill, signed by President Barack Obama into a law governing agriculture for the next decade, is the elimination of the $4.5 billion annually in direct payments in favor of an expanded crop-insurance program.

The package also reduces spending on food stamps by about $8 billion over 10 years — about 1 percent of the total Supplemental Nutrition Assistance Program (SNAP) budget.

Those items have received the headlines and lion’s share of media coverage. But the 959-page, $956 million bill — known as the Agriculture Act of 2014 — includes a king’s ransom of lower-profile provisions intended to have wide-ranging impact on the estimated 16 million Americans involved in agriculture and the people who consume their goods.

In a phone interview with Political Mercury, U.S. Secretary of Agriculture Tom Vilsack delved deeply into the spending and policy in the farm bill, saying Iowa producers can mine it for opportunities to improve rural life.

Political Mercury asked Vilsack to focus on some of the under-the-radar elements of the legislation.

The farm bill, for example, includes a series of programs to create new market opportunities for small- and medium-sized operations, Vilsack said, adding that one of the challenges in agriculture is the perception that “you’ve got to go bigger or you’re not going to survive.”

“We want to rebuild the smaller and mid-sized operators, and to do that, we’ve got to give them options outside of marketing in a commodity market,” Vilsack said. “A commodity market basically puts a premium on efficiency and volume.”

Smaller producers need new, direct-market opportunities, the ability to sell directly to a customer, Vilsack said.

The bill includes more funding for farmers markets, value-added producer-processing opportunities and money for state ag departments to promote specialty crops, he said.

On the beginning-farmer front, the bill includes $200 million in insurance-premium support for new farmers and ranchers, those with less than five years of experience.

“That’s a new wrinkle,” Vilsack said.

Vilsack said the bio-based agricultural economy is affording more ways to use byproducts from grain and livestock operations for profitable side ventures — “a corn cob into a plastic bottle, a cornstalk into a sheet of clear plastic that can be used in the windows of envelopes.”

“There’s a whole new world of opportunity here with bioprocessing and manufacturing, taking crop residue and livestock waste and woody biomass and converting into these chemicals and materials,” Vilsack said.

The bill allows programs that in the past had been geared for renewable energy and fuel to help finance bio-based manufacturing.

“That’s an exciting opportunity,” Vilsack said.

American agriculture has never had a vehicle for research similar to health care, a one-two punch foundation seeded with government money and augmented with private funds.

The bill provides $200 million and requires matching dollars for a foundation that will spin out innovations in agriculture.

The intent is to do for agriculture what the National Institutes of Health does for medicine.

“Yes, it’s similar to that,” Vilsack said.

According to Vilsack’s department, U.S. agricultural exports reached a record $140.9 billion in fiscal year 2013 and supported about a million U.S. jobs. In fact, compared with the previous five-year period from FY 2004-2008, U.S. agricultural exports from FY 2009-2013 increased by nearly $230 billion.

On the center-stage provision, Vilsack said it was time to end the $4.5 billion a year in direct payments, fixed per-acre disbursements that had nothing to do with crop prices — and often went to people not actually involved in agriculture.

“It’s pretty obvious to me that the direct-payment system was the source of justifiable criticism on the part of those who don’t farm,” Vilsack said. “It was frankly hard to explain to people why farmers were receiving checks when corn was selling for $8 a bushel and soybeans were at $15 a bushel, at record prices. And the same was true for cotton and other commodities.” CV

Douglas Burns is a fourth-generation Iowa newspaperman who writes for The Carroll Daily Times Herald and offers columns for Cityview.