Safety net scaled back as Senate passes agriculture bill

The U.S. Senate passed a $955 billion rewrite of agriculture law by an even larger margin than last year, sending it to the House of Representatives, where disagreements over food stamps and farm subsidies may complicate passage.

Monday’s vote was 66-27, compared with last year’s 64-35 vote on similar legislation in the Senate. Increased support came from Republicans who successfully pushed for more subsidies for rice and peanuts -- crops grown in southern states.

The most expensive non-appropriations legislation to pass the Senate this year would end a program that makes direct payments to farmers regardless of crop prices while expanding an insurance-based safety net.

The measure would reduce government spending by about $2.4 billion annually, though its $4 billion in cuts to food stamps over a decade are only about one-fifth as deep as proposed in the House version, which would cost $939 billion over 10 years.

Senators said members of the Republican-led House, which didn’t consider the five-year measure last year, now have to show they’re serious about reforming U.S. agriculture subsidies.

“If they don’t do a bill, direct payments continue,” North Dakota Senator John Hoeven, a Republican, told reporters as the votes were tallied.

Companies Benefiting

Subsidies benefiting buyers such as Archer-Daniels-Midland Co. and food stamps subsidizing purchases at Supervalu Inc. are targets for lawmakers seeking deficit cuts, while humanitarian groups oppose cuts in programs that serve the poor. Crop insurers including Wells Fargo & Co., Ace Ltd and Deere & Co. will benefit from the legislation’s boost to insurance programs, Mark McMinimy, an analyst with Guggenheim Washington Research Group in Washington, said in a note to investors yesterday.

While Senate Agriculture Committee Chairwoman Debbie Stabenow, a Michigan Democrat, and the panel’s top Republican, Thad Cochran of Mississippi, have said they would resist further cuts to food stamps, House Republicans are saying spending may need to be lower.

“Unless there are some significant changes and some significant effort, I don’t think this’ll get across the floor,” Representative Tim Huelskamp, a Kansas Republican, said in an interview.

“People in Kansas get it -- just because it’s the farm bill doesn’t mean you have to vote for it,” said Huelskamp, whose district was the second-biggest recipient of agricultural subsidies last year, according to data compiled by conservation advocate Environmental Working Group.

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