Reid says Senate will not extend farm law

Majority Leader Harry Reid says the Senate will not extend current farm law if Congress can't agree on a new farm bill before adjourning next week.

House leaders have reserved space on their agenda this week for extending the current law until the end of January. Lawmakers fear that milk prices might rise sharply if dairy subsidies expire Jan. 1.

The House and Senate have passed separate versions, but with widespread differences over crop subsidies and how much to cut food stamps.

House Speaker John Boehner said last week that the House should extend the current law while negotiators seek a compromise. But Reid balked at that plan.

"Let them vote on it. We're not going to do it," he said Tuesday.

Some senators fear an extension relieves pressure to get a deal. The Senate Agriculture Committee, led by Democratic Sen. Debbie Stabenow of Michigan, tweeted Tuesday, "We don't need an extension -- we can get this done this week."

In a separate tweet, the committee said a short-term extension could allow subsidies called direct payments to continue. Those subsidies are paid to farmers whether they plant or not and have come under political fire from conservatives and others who have lobbied for less spending on farm programs. Both the House and Senate farm bills would eliminate the subsidies and create new ones.

Finding a compromise on cuts to the nation's $80 billion-a-year food stamp program has been the toughest obstacle in the talks between the House and the Senate. The House passed a bill this summer that would cut $4 billion from food stamps annually and allow states to create new work requirements for some recipients. The Democratic Senate, backed by President Barack Obama, passed a farm bill with $400 million annual cut, or a tenth of the House cut.

Negotiators have focused on cracking down further on a practice in some states of giving low-income people as little as $1 a year in home heating assistance, even when they don't have heating bills, in order to make them eligible for increased food stamp benefits. The Senate found its $400 million in annual cuts by requiring that recipients receive at least $10 in assistance to make them eligible, while the House doubled that cut by requiring that recipients receive $20 annually -- bringing the savings to around $800 million a year.

North Dakota Sen. John Hoeven, a Republican who sits on the House-Senate conference committee, confirmed that negotiators have floated that $800 million in annual cuts plus pilot programs that would create new work requirements in a handful of states. But he stressed that there is not a final deal.

Hoeven said he agreed that the Senate should not pass an extension.

"We want to keep the pressure on to get a farm bill done," he said.

Negotiators are also working out how farm subsidies should be restructured in the absence of the direct payments. The two chambers have argued over how to replace those payments, with major farm groups squabbling over whether subsidies should kick in based on crop prices or farmer revenue, and how to count the acreage on which the subsidies are based.

If the negotiators can't agree on a bill and Congress allows the dairy supports to expire, 1930s and 1940s-era farm law would go into effect. Those laws would raise the price that the government currently pays to purchase dairy products, prompting many processors to sell to the government instead of commercial markets. That would decrease commercial supply and consequently raise prices for shoppers at grocery stores.

Prices wouldn't go up immediately, as the Agriculture Department would have to write the new rules based on the old laws and then put them into place. Hoeven and other senators have said that the Agriculture Department could delay writing the new laws while members of Congress finish working on the bill.

But it is unclear if Agriculture Secretary Tom Vilsack would go along with that. He said last month that he is prepared to implement the new laws "in short order" if current law expires.