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Vilsack: No farm bill could hurt entire economy

The US Agriculture Secretary said 'every aspect' of the economy will suffer if Congress does not sign a new farm bill.

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US Secretary of Agriculture Tom Vilsack speaks about a drout destroying crops and livestock during the Daily Press Briefing in the Brady Briefing Room of the White House in Washington, DC, July 18, 2012. (SAUL LOEB/AFP/Getty Images)

US Agriculture Secretary Tom Vilsack is worried about more than just the looming 'fiscal cliff' deadline. 

He also has the entire US agricultural industry to worry about. If Congress does not sign a new farm bill by January 1, the price of milk could double and send a ripple effect throughout the entire economy. 

"It is unconscionable that we don't have a farm bill," Vilsack said in an interview that aired Sunday on CNN's "State of the Union." "This is just historic."

According to CNN, the five-year bill aids farmers by setting price protections and subsidies. The current farm bill expired on September 30 and an extension to the bill faced stiff opposition from Republicans in Congress. 

A divided GOP argued that the price tag for the new bill was too high while others though reforms didn't go far enough, reports CNN. 

But Vilsack issued a dire warning that the entire economy will feel the effects if no new bill is signed. Milk prices are especially vulnerable because a subsidy that keeps prices low is set to expire on January 1. 

The formula for calculating the price the government pays for dairy will default back to a 1949 statute that would force the government to buy milk at twice todays price. 

"Consumers, when they go in the grocery store, are going to be a bit shocked when instead of seeing $3.60 a gallon for milk, they see $7 a gallon for milk," he said. "And that’s going to ripple throughout all of the commodities if this thing goes on for an extended period of time."

According to POLITICO, Vilsack is also concerned about the wider impact of failing to sign a new farm bill. Renewable energy, biofuels, agricultural exports, conservation programs and farmers' markets will also take a hit.

Vilsack also called the efforts in Congress to slash the numbers of food stamp recipients is "misguided". Ninety-two percent of food stamp recipients are seniors, the disabled or children of working families, he said. 

“It’s an important program. It’s misunderstood,” he said. "When you understand who you're helping here, then it becomes a little bit more difficult to advocate for significant and massive cuts as some have suggested.”

http://www.globalpost.com/dispatch/news/regions/americas/united-states/121230/vilsack-no-farm-bill-could-hurt-entire-economy