The Senate Monday began consideration of the 2013 Farm Bill, with Sen. John McCain, R-Ariz., offering the first amendment to eliminate crop insurance subsidies for tobacco.
Full Senate debate comes less than a week after the Senate Ag Committee passed the bill with a 15-5 vote May 14.
In opening comments, Sen. Debbie Stabenow, D-Mich, chairwoman of the Senate Ag Committee, again touted the expected $24 billion in taxpayer savings the Farm Bill offers, as well as the new options for crop insurance.
However, McCain said the eight types of tobacco covered under crop insurance in the Farm Bill are profitable without "their old farm subsidies," McCain said. His amendment, which is co-sponsored by Sen. Dianne Feinstein, D-Calif., would save $333 million over the next 10 years, according to the Congressional Budget Office.
“It might surprise Americans to know that despite efforts to end traditional farm subsidies for tobacco producers, government handouts for tobacco lives on in the form of highly subsidized crop insurance," McCain said on the floor.
“As my colleagues know, crop insurance in general has a dubious reputation as a ‘safety net’ for farmers because it largely insures against revenue loss instead of crop loss due to weather or pests," McCain said. He argued that most tobacco is exported, and is 10 times more profitable than corn.
"The value of American tobacco is at a 10-year high since Congress ended traditional tobacco subsidies," he said. "It makes no sense to subsidize tobacco insurance considering how well the free market system is working for tobacco producers."
In a press statement, Feinstein noted that tobacco costs the economy $200 billion in health care costs and productivity.
"In this challenging budget environment, we simply can’t afford to spend hundreds of millions of dollar to incentivize farmers to grow this crop," she said.