The US Government Shutdown and Its Impacts on Food Policy

Given that I am living in Europe right now and haven’t been a resident of the US for more than 17 years, it seems I am posting disproportionately about US politics, doesn’t it? Well, my apologies to my European readers, I will try to balance it in the future – however, right now there are so many more things wrong with US food policy that I guess it gives me more food for thought 😉

For example the recent shutdown of the government. If you haven’t followed along, the two chambers of Congress (the Republican-dominated House of Representatives and the Democrat-dominated Senate) are having a bitter stand-off over next year’s budget. After the House passed a bill making the passage of a budget contingent on the non-funding of President Obama’s health care reform (so-called Obama-care) in the coming year, and the Senate rejected to co-sign that bill, both sides are blaming each other for what amounts to a winding-down of almost all government activity as of yesterday (since without a budget the US government is not allowed to act).

Now, first of all this means that 800,000 federal employees are ‘furloughed’ (forced to take unpaid leave) until the issues are resolved. But also many government services are affected, including food and nutrition assistance.

Though the food stamp (SNAP) program continues to be funded through the end of October, the same can’t be said for the Women, Infants and Children (WIC) program, which helps around 9 million low-income pregnant women, mothers and their babies to afford infant formula and nutritious food. According to this article, it is up to the individual states to try to fund their programs from other sources (an approach called ‘contingency funding’), since no federal money has been allocated for October.  The USDA estimates that most states have enough funding for “a week or so“, but that they will “likely be unable to sustain operations for a longer period“.

At the same time, and with very few people paying attention, the Farm Bill expired yesterday as well (again), which means that federal conservation programs such as the Conservation Reserve Program, Wetlands Reserve Program, Grassland Reserve Program or Healthy Forest Reserve Program are shut down for the time being as well.

Concerning farmers, while most subsidies are funded on a yearly basis and will not be affected, the Milk Income Loss Contract that is supposed to support dairy farmers expired along with the farm bill, though analysts say that milk prices will be high enough for the coming months that it wouldn’t have kicked into force anyhow.

As an agricultural economist, it was interesting for me to hear that farmers are however concerned that certain services of the USDA such as price forecasting and statistical analyses would be on hold, since these services have an important informational value for them (yay, ag economists are important!). In particular, no reports on crop estimates and sales will be issued, which will significantly hamper trading on agricultural markets (since such information is widely used to forecast futures prices).

Overall, a vast number of the 100,000 USDA employees will be furloughed (though I couldn’t find an accurate percentage of how many; in comparable agencies the number seems to be between 50 and 80%), but only 13% of the approximately 10,000 working for the Food Safety and Inspection Service arm of the USDA will required to stay home. This means that inspections of meat and poultry will continue.

The Food and Drug Administration, according to the New York Times, “would continue some vital activities, like product recalls and the inspection of imports, but would curtail many other food safety activities.“

And 94% of the employees of the Environmental Protection Agency will be furloughed, including pollution and pesticide regulators. Because, you know, who cares about the environment.

In sum, it seems this shutdown is – ironically – a good lesson to show people what government really does for them, and what they pay taxes for. However, as usual, it disproportionately affects those that need assistance the most (as those in the WIC program). Snide little side note – Members of Congress aren’t furloughing themselves, because their pay is written into permanent law. Of course, it is a lot easier to make far-reaching decisions that affect everybody else in the economy if your own pay check isn’t cut. Personally, I think I agree with this opinion piece: “The Republican leaders of the House of Representatives are failing. They should fulfill their basic duties to the American people or make way for legislators who will.“