It would have been nice if government had been as concerned about debts and deficits five, ten, twenty years ago as they are now – but with a new Congress apparently getting at least a little bit serious about deficit reduction it's time to consider just what this all means for the average family farmer.

The Farm Bill in the U.S. is what's called an "omnibus bill" that comes up for consideration every five years.  By "omnibus," it means that it's a piece of legislation that covers a lot of different issues. The Farm Bill, which largely determines agricultural and food policy in this country, deals with community food programs, commodities, trade, farm credit, conservation, research, food safety, general welfare of rural communities, environmental issue, subsidies and more.

It's hardly news by now that President Obama is planning a five-year freeze on "discretionary spending" – which means virtually everything except defense and the military. One thing that farmers are going to see is a dramatic drop in direct payments. Those who participate in the Average Crop Revenue Election (ACRE) Program are going to see those payments drop by as much as 20%. Now, arguably, these payments, meant to function as a safety net when farms experience a bad year, are paid out every year, whether it was good or bad. The argument here is whether or not such payments should be made if they are not necessary, i.e., Farmer Brown had a bumper crop that year and actually made a profit. We could see ACRE being reconfigured to match payments to farmers who actually are having trouble, and not just being a generic farm welfare program, and on balance that would be good for farmers.

Another potentially positive side to the current Farm Bill - an end to a multi-billion dollar giveaway to a small group of wealthy sugar producers. The sugar subsidy was originally part of the 1981 Farm Act, and provides subsidies and price supports to domestic sugar producers. At the time this seemed like a good idea, but in the subsequent years we’ve seen that it creates major hardship for growers in unsubsidized, and usually extremely poor, countries in the Caribbean. American farmers are simply the best in the world; in a fair competition we can grow whatever crops we need to grow. Subsidies make some sense for new-born industries or where our overseas competitors are subsidizing their farmers, but neither of those are the case for sugar production and hopefully this obsolete giveaway can be ended and the funds redirected towards programs that actually strengthen American agriculture.

There is no doubt that family farmers are going to feel some pain here, but the issues are far from simple. I'll be keeping an eye on them as they develop.