Shutdown Stings Farmers, Adds Toxins to Farm Bill Talks
Source Newsroom: Cornell University
Andrew Novakovic, agricultural economist, Farm Bill expert and professor of Applied Economics and Management at Cornell University, discusses the impact of the current government shutdown on agriculture-related federal services. Novakovic has acted as senior economist to the USDA Office of the Chief Economist since 2011. His activities included assisting in analyzing proposals made in connection with agricultural legislation and other issues related to dairy programs.
“With the biggest share of government spending mandated under ongoing law, Congress' failure to pass appropriations for Fiscal Year 2014 will have relatively little or no effect on the big ticket items of government. Most of the big-government programs that they believe are out of control will continue unabated because their funding is mandated, non discretionary.
“Instead, a large number of federal workers will get unpaid leave, visitors to D.C. and national parks will find doors barred shut, and all kinds of folks and businesses will find out how much we rely on a myriad of federal reports that are easy to take for granted. Retirement programs that calculate benefits based on changes to the Consumer Price Index won't have a new estimate of changes to consumer prices. CME futures markets that cash settle against a federal estimated price won't have a cash price announced. Farmers that had planned to finish that paperwork in their local FSA office will find the door locked.
“With each advancing day, compromise becomes both more necessary and more difficult. And, as the deadline for expanding the debt ceiling gets closer, the stakes are raised. It may be easy to stand by while government workers calculate how long they can go without a paycheck, but the prospect of the government of the world's largest economy and most powerful country reneging on its loan payments is punishing to advocates of fiscal responsibility.
“Wednesday the U.S. Senate re-announced its Farm Bill conferees even as House Agriculture Committee Ranking Minority Member Collin Peterson and Secretary of Agriculture Thomas Vilsack despair of being able to find a compromise. The government shutdown in and of itself doesn't impact passage of the next Farm Bill, but the shutdown adds toxins to a political environment in which compromise feels almost impossible.”