Drought Aid for Farmers Runs Dry in Washington
The nation’s drought-stricken farmers and livestock producers are unlikely to see much relief from Washington.
While the U.S. Department of Agriculture is spending more on meat and fish, a relief package and a massive farm bill are still mired in Congress and unlikely to move in these crucial months leading up to the presidential election. (Related: Ag Secretary: We Promise to Help Drought-Stricken.)
The Obama administration this week announced the government’s purchase of up to $170 million of pork, lamb chicken and catfish, bringing its total purchases this year to $941 million. The food purchases are a boon to food banks across the nation and other assistance programs, but some farmers are calling it too little too late.
More aid is still working its way through Congress, which is currently out on recess. The farm bill is a huge document, largely dealing with government subsidies unrelated to the drought, like food stamps. It does have some disaster aid in it, but is stuck in the Republican-led House of Representatives.
“There are a few programs in the farm bill that would be helpful, mainly to grazing animals, but the farm bill is not going to bring back this year’s crops, reduce the price of corn or soybeans, and that’s what is really needed,” said Mark McMinimy, a policy analyst at Guggenheim Partners.
Still, the Congressional logjam gave President Obama this week ample opportunity to use it against his new opponent on the Republican ticket, vice-presidential nominee Paul Ryan.
“So if you happen to see Congressman Ryan, tell him how important this farm bill is to Iowa and our rural communities,” he told a crowd in Council Bluffs, Iowa.
Iowa is a crucial swing state in the upcoming November election. (Related: President in Iowa: Congress Needs to Pass Farm Bill.)
A separate bill that would open up federal lands for grazing passed the House of Representatives this month, but the Senate did not take it up before the recess. Democratic leaders want to include it in the farm bill.
Another line of aid could come from Ethanol, a corn-based fuel. (Related: Cyr: Drought, Ethanol Mandate Equals a Big Problem.)
Livestock producers want a waiver on the renewable fuel standard, which requires 40 percent of the Midwest crop to be used to make Ethanol The Environmental Protection Agency would only issue such a waiver if it found the standard caused deep economic harm. That looks unlikely.
-By CNBC's Diana Olick