Dear Chairman Kohl and Ranking Member Blunt,
As you know, the House Appropriations Committee has passed the Agriculture Appropriations bill for fiscal year 2012. As Members who are concerned for America's farmers, rural America, and energy independence, we write today to request further discussion on several cuts in this legislation and to suggest changes to whichever final bill is crafted in order to benefit working class Americans, reduce our debt, and maintain critical investments in our agriculture infrastructure.
First, we would like to applaud the current legislation passed by the Appropriations Committee for including language that would cap direct payments. Right now, more than 30,000 farmers earning $750,000 in farm income and $500,000 in non-farm income still receive direct payments. This is unacceptable and we encourage you to continue to work on behalf of farmers, ranchers and producers who make under $250,000 adjusted gross income (AGI). Maintaining this language secures a safety net for family farms, ranchers and producers who face great risk to produce a stable and affordable food supply for our nation by limiting support to only those who truly need it. This is a smart spending cut.
We understand the position your committee faces for fiscal year 2012 funding and the precision it will take to craft an appropriations bill that both reduces our deficit and supports the agriculture industry while assuring affordable access to food and fiber. However, the House legislation contains drastic cuts that we believe are harmful to our nation's safety, stability, and growth.
While we support an income cap on direct payments, we are troubled by the reduction in crop insurance by 59 percent. It is too risky to reduce a source of revenue for farmers, while also dismantling their safety net. Farmers and ranchers produce our nation's food in part because they know they can insure their high-cost inputs, land and product, should weather or other factors reduce or damage their crop. Quality, affordable and accessible crop insurance is paramount to ensuring we have a safe and stable food supply.
The House legislation also contains extreme cuts to energy infrastructure that would impair our ability to free our constituents from Big Oil and bondage to OPEC and hurt our economy. It nearly eliminates funding to install ethanol pumps at rural service stations -- reducing it from $75 million to $1.3 million. The bill also further rescinds all funds that assist and encourage conservation practices that allow corn cobs, switch grass and other non-feed stalks to be brought from the farm to the pump through bio-fuel production. This apathy for energy infrastructure and domestic energy production is exceedingly foolish in the face of high gas prices caused by Wall Street speculators and unfriendly foreign oil. From 2005 to 2010, U.S. imports of crude oil were reduced by three million barrels a day. A key factor for this reduction was U.S. production of approximately 600,000 barrels of ethanol per day for five years coupled with decreased consumption. We must do more to continue to reduce our dependence on imported oil and invest in our domestic energy industry. It is a matter of jobs and national security.
The House legislation further compounds consumers' pain at the pump and threatens agriculture operations by failing to provide the Commodity Futures Trading Commission (CFTC) with the funds necessary to oversee and regulate the over-the-counter swaps market as directed by the Dodd Frank Wall Street Reform bill. The cuts to the CFTC weaken the Commission's ability to protect consumers from the dangers of over-speculation in the market. The Dodd Frank bill was enacted to protect consumers and pension plans in each of our districts, including the 38 million individuals who lost their jobs in one year because of a financial crash. Such drastic cuts to the CFTC would make Americans even more vulnerable to market gamblers, such as the speculators recently charged for falsely driving up the price of oil in order to make big profits in 2008. Agriculture end-users depend on a strong regulatory force to weed out market players who are manipulating prices and threatening their operations. To cut the funding and personnel to the CFTC in this way is to tolerate manipulation, collusion, and fraud in our markets.
The issues we have mentioned above are of great importance. However our concerns are not limited to them. Beyond shaking our footing for economic independence and trading market stability, this legislation makes massive cuts to research, conservation, food safety and access to nutrition, particularly the Women, Infant and Children's program (WIC). While we are pleased that $147 million was given back to WIC, cuts to domestic food assistance remain a concern.
The Department of Agriculture knows that in these times, we must do more with less. Just last year, the budget baseline for agriculture was trimmed by $6 billion in the Standard Reinsurance Agreement, putting $4 billion toward deficit reduction. However, there are some initiatives that are vital for the strength of our nation and economic progress for our constituents. We hope that you will take this letter into consideration while working to craft Agriculture Appropriations for fiscal year 2012. Thank you for your attention to this letter and your leadership on the Senate Agriculture Appropriations Committee.
Leonard L. Boswell Bruce Braley Dave Loebsack