It seems not a single crop meeting was held during the winter that didn’t include at least some mention of the next farm bill. The most obvious observation being that an out-of-control federal deficit will make it difficult to maintain funding for agricultural programs at current levels.
Farmers are being encouraged by commodity group leaders to begin developing a clear explanation of why specific farm programs should be maintained, and why a national farm policy that stabilizes food and fiber production ultimately benefits everyone.
But for those among you who don’t wish to wait before beginning your defense of farm spending, the Bush Administration’s budget for fiscal year 2006 offers ample opportunity to get a head start. Some of those complaining about not enough specifics in the President’s recent State of the Union speech are suddenly seeing too many specifics being addressed in his budget proposal.
The Bush budget seeks deep cuts in farm and commodity programs and proposes overall limits on subsidy payments to farmers. Such limits, say administration officials, would help reduce the federal budget deficit and would inject market forces into the farm economy.
The proposal puts Bush at odds with some of his most ardent supporters in the rural Southeast. A sign that the new budget will be especially tight is that the administration is willing to push the proposal despite the protests of the new chairman of the Senate Appropriations Committee, Thad Cochran (R-Miss.), and more than 100 farm groups.
Republican Sen. Saxby Chambliss of Georgia, who is the newly installed chairman of the Senate Agriculture Committee and a strong Bush ally, says he expected the White House and congressional Republicans to target farm subsidies as they search for ways to trim federal spending and reduce the budget deficit.
Some reduction in the programs may be unavoidable, says Chambliss, but he has pledged to protect farm programs from deep cuts or outright elimination, as some Republican leaders have suggested. “They may look different the next time around, but I don’t think we’ll ever end them,” he says.
How different is anyone’s guess. Bush’s budget proposal lowers the payment limit cap for individuals to $250,000 for commodity programs, including all types of marketing loan gains. The proposal comes as the administration is seeking significant changes in other programs long considered sacrosanct, with the proposed revamping of Social Security to allow personal investment accounts and a move to shake up the Civil Service system.
The budget also would cut federal payments to farmers by $587 million, or about 5 percent, next year and would save $5.7 billion in the coming decade.
In a letter to Mike Johanns, the new secretary of agriculture, a coalition of more than 100 farm groups say they will resist the budget cuts. “With prices for many major commodities falling sharply from last year, reductions to farm programs would come at precisely the time when these supports are most needed in rural America,” says the coalition, which includes nutrition and conservation groups.
The White House proposal is somewhat of a vindication for Sen. Charles Grassley (R-Iowa), who has advocated “reasonable payment limits” for three decades.
“When 10 percent of the nation’s farmers receive 60 percent of the payments, it erodes public confidence in federal farm programs,” says Grassley, who is fond of describing himself as the only family farmer in the U.S. Senate.
“Unlimited farm payments have placed upward pressure on land prices and contributed to over-production and lower commodity prices, driving many family farmers off the farm,” says the senator.
In a report last year, the federal government’s Accountability Office — an investigative arm of Congress, said farmers used many “schemes or devices” to circumvent existing payment limits. Under federal law, payments are supposed to go only to people who are “actively engaged in farming,” but, the report stated, many people not involved in farm operations have received large subsidies.
It’s clear to see that whatever the outcome of the Bush proposal and the next farm bill, farm programs will, as Georgia’s Sen. Chambliss said, look different the next time around. How different may depend on how well farmers and their lobbying groups state their case.