Agriculture Reform, Food, and Jobs Act of 2013

Floor Speech

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Mr. McCAIN. I thank the distinguished manager.

Since I have the floor, I would like to make a brief statement about the amendment. I understand the objection, and I would rely on the good offices of the manager of the bill, as well as the ranking member, that we would have a vote early on in regard to this amendment and not at the last minute when we are trying to complete the votes on the amendments to the bill.

The amendment by Senator Feinstein and me would eliminate taxpayer-subsidized crop insurance for tobacco. The Congressional Budget Office estimates this amendment would save taxpayers $333 million. Again, that is the estimate of the Congressional Budget Office.

It might surprise Americans to know that despite efforts to end traditional farm subsidies for tobacco producers, government handouts for tobacco lives on in the form of highly subsidized crop insurance. Since 2004 we have spent more than $276 million on insurance subsidies for tobacco. This is in addition to the $10 billion financed under the tobacco buyout law the Congress passed a decade ago. That law was paid for by assessments on cigarette manufacturers, and it was meant to wean tobacco growers from farm subsidies by buying out their growing quotas. Well, it turns out that Joe Camel's nose has been under the tent all this time in the form of these hidden crop insurance subsidies.

As my colleagues know, crop insurance in general has a dubious reputation as a "safety net'' for farmers because it largely insures against revenue loss instead of crop loss due to weather or pests. According to the Congressional Research Service, taxpayers spend about $14 billion a year to subsidize about 60 percent of the cost of crop insurance premiums. The Federal Government also reimburses private crop insurance companies for about 25 percent of their "administrative and operating'' costs.

We have identified eight types of tobacco that are eligible for crop insurance: tobacco Maryland, tobacco flue cured, tobacco fire cured, tobacco dark air, tobacco cigar wrapper, tobacco cigar filler, tobacco cigar binder, and tobacco burley. All of these crops remain extremely profitable even without their old farm subsidies.

According to reports by the Wall Street Journal and CNBC, tobacco is 10 times more profitable than corn and most American tobacco is exported. In fact, the value of American tobacco is at a 10-year high since Congress ended traditional tobacco subsidies. It makes no sense to subsidize tobacco insurance considering how well the free market system is working for tobacco producers.

I will have a longer statement on this, Mr. President.

Last year the eight separate tobacco insurance products cost $34.7 million in taxpayer subsidies. The USDA--Department of Agriculture--data shows that more than $276 million in taxpayer subsidies has been spent on this tobacco subsidy program since 2004.

According to the Centers for Disease Control and Prevention, cigarette smoking adds $96 billion to domestic health care expenses and costs the American economy $97 billion in loss productivity annually. Secondhand smoke adds another $10 billion in health care costs and lost productivity.

Clearly, we should be doing nothing to subsidize production of tobacco. I am not saying we should ban the growth of tobacco in America; that is a decision farmers and the market make. But for us to continue to subsidize when these enormous costs are borne by the American people in terms of our health and our economy--it is time we ended it.

I thank the distinguished manager and ranking member for their commitment to having an up-or-down vote on this amendment.

I yield the floor and suggest the absence of a quorum.

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