The New Farm Bill Signed Into Law Today

Today, after two years of contentious and lively debate between Democrats and Republicans, the country's latest Farm Bill has finally become law. In a ceremony that took place at Michigan State University, the nation's first land grant university that's always had a focus towards agricultural education, President Obama put his signature on the final version of the bill, officially guiding how the country takes care of its food supply over the next five years.

It's a big deal, is the point. So, let's detail exactly what ended up in it.

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- The bill allocates $956 billion in government spending over the next decade, but creates policy for only the next five years, meaning if you were sick of the fighting over this bill, maybe find yourself a nice cave to hide in come 2018? The whole thing also runs 959 pages, if you're looking for some light winter reading.

- The breakdown of that spending is $756 billion to the SNAP program, $89.8 billion to crop insurance, $56 billion to conservation, $44.4 billion to commodity programs, and $8.2 billion to the all-encompassing "everything else."

- If that $756 billion towards the SNAP program looks big, it is. It's certainly the highest percentage of money allocated in the bill. But it's also about $800 million less a year than previously spent, or $8.7 billion in total spending. (The House Republicans wanted SNAP to be cut by $39 billion, so they passed this version of the bill through gritted teeth.) This means those relying on SNAP may have their benefits lowered by as much as $90 a month.

- Well, sort of. And hang in here, because things are about to get complicated. Before this bill's passage, there was a bit of a loophole in place. See, eligibility for SNAP is determined by a household's disposal income. To calculate that, states take a household's total income and subtracts deductions for "essentials." One of these essentials is heating, so if a household gives proof they're paying for heat themselves (as opposed to a landlord) they can claim that deduction, and drop below the threshold needed to qualify for assistance. Problem is, because of some strange way of doing the bookkeeping (more of which can be learned about here) certain states (15 of them total, of which California is one) were giving SNAP benefits to people who don't qualify. The new Farm Bill closes that loophole. All of which is to say, the cuts should theoretically only affect people in the 15 states where those loopholes exist, and only the people who shouldn't have received assistance in the first place. This accounts for about 4% of the recipients.

- Which is certainly not to say that low-income households aren't going to be hit hard by these cuts. They most certainly are going to be worse off than before. But this closing of the loophole was deemed a necessary provision by the Democrats who didn't want to risk the Republicans further gutting the program. It's a "deal with the devil" kind of thing.

- There's actually more to the Farm Bill than just food stamps. For instance, labeling issues! Now, all pork, chicken and beef sold in the U.S. must include information on where the animal was "born, slaughtered and processed."

- Farmers are no longer guaranteed payments regardless of what they harvest or the prices of their crops. (This has been the way the country has managed "farmer's risk" over the past 82 years.) Instead, they'll be asked to participate in a version of crop insurance that will transfer the risk of the market to the government. Something bad happens to a crop, the country will pay for it. The Economist, among other places, are not huge fans of this new method of doing things.

- Oh, this is a fun quirk: Members of Congress no longer have to disclose if they receive farm subsidies, meaning it's harder to get information regarding how much money people voting on these issues are, themselves, earning from the bill. This is particularly worrying, as 15 lawmakers (or their spouses) collected a total of $237,921 in farm subsidies in 2013. Not exactly the kind of thing you want if your goal is to make sure people are voting with their minds not on their own wallets.

- On the environmental front, the Farm Bill is creating new programs to fight soil erosion, which is certainly a good thing. It also cuts subsidies for farmers who plow "virgin land," trying to put a halt to farm expansion. On the flip side of that, total spending for "agricultural conservation efforts" has been cut.

- Don't like sushi? Better start. As part of every Farm Bill, the government focuses in on a few crops by giving them more subsidies than others, playing favorites if you will. The new kid on the block this time around? Farmers who grow sushi rice.

And, well, that's a nice start. This thing is big folks, and we'll surely be hearing positives and negatives as we get further and further into it. So, as always, stay tuned.


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