Federal legislators representing various agriculture committees in Congress have rejected the cuts to crop insurance President Obama unveiled in his budget plan this week. The plan looks to cut $8 billion in funding for crop insurance throughout the country. Legislators claim that this would be a major blow to many farmers, especially those in areas that are prone to seeing natural disasters. The Obama administration is keen to make cuts to crop insurance because it claims that some farmers are abusing the system, as they will be paid for their work regardless of whether they produce anything in the event of a natural disaster.
Legislators fear that if the plan is enacted it will spell the demise of the Supplemental Revenue Assistance Payments (SURE) program, the federal crop insurance scheme. This program provides an insurance safety net for farmers in the event of a catastrophe that destroys their land. This program allows farmers to receive direct payments from the government, a fact that the Obama administration is looking to change.
Legislators argue that if the direct payment system is abolished, the government would have to come up with a decent replacement. Crops insurance is the most apparent answer to this problem, but due to the risks faced by farmlands in disaster prone regions, the premiums that farmers would have to pay for coverage would be excessively high. Lawmakers are currently working to find a workable alternative that will be beneficial for farmers.
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