The Senate Agricultural Committee has approved a new farm bill that would change the way farmers are supported by the federal government, reports Bloomberg.
Under the current bill, which is set to expire in five months, farmers are directly paid by the federal government simply for farming. Critics of the bill say the payments aren't tied to actually planting crops, making it ripe for abuse. In addition, average farm income has risen in recent years to the point where many farmers simply aren't struggling enough to justify payments.
The new version of the bill actually takes an idea from nearly 60 years ago - instituting a revenue floor for farmers. Under the new proposal, farmers will essentially be guaranteed to make a certain amount each year, no matter how their crops fare. If the farmers do well and exceed the revenue floor, the federal government doesn't pay them anything. If they end up with less revenue than the bill stipulates, the government will make up the difference to ensure they can keep farming in the future.
"The era of direct payments is over," Senate Agricultural Committee chairwoman Debbie Stabenow told the news source. "We have put together a bipartisan farm bill that’s focused on farmers."
The bill passed the committee hearing with a 12-4 vote. However, Congressmen on both sides of the aisle acknowledge there's work to be done on the bill before it will pass the House and Senate. Both Democrats and Republicans have shown a desire to reduce farm spending. The new bill would reduce the federal deficit by $24.7 billion over the next 10 years. House Republicans previously voted for $33 billion in cuts, and President Barack Obama targeted $32 billion in his 2010 budget proposal.
No matter how they're getting paid, farmers need to reinvest some of their profits into their agricultural equipment. The online auction site IronPlanet offers a wide array of sprayers, combine harvesters and other equipment, often at a more affordable price than buying new.
