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Next farm bill proves a fertile field for disputes

The administration wants subsidy cuts with trade in mind. Congress may resist such moves.

January 15, 2007|From the Associated Press

WASHINGTON — Lawmakers are beginning work on a new multibillion-dollar farm bill at odds with President Bush over whether big changes are needed.

The two sides are far apart. Just how far, farmers saw for themselves during the American Farm Bureau Federation's recent meeting in Salt Lake City.

"I think the bill could look a lot like what we have now. What I think we're going to end up doing, you could say, is extending the farm bill," Rep. Collin Peterson (D-Minn.), chairman of the House Agriculture Committee, told farmers.

Contrast that with Bush's agriculture secretary, Mike Johanns, who said at the meeting that farm programs needed an overhaul.

"I will be the first to argue that the 2002 farm bill was good policy for its time," Johanns said. "But the agricultural and economic realities that influenced the development of the '02 farm bill -- they simply don't exist."

The farm bill -- really a series of federal programs -- gives farmers payments and other help to supplement their incomes, support crop prices and manage supplies.

Nearly $18 billion in public money was spent on these programs last year. The current farm bill expires at year-end.

Congress and the administration disagree mightily on what the new farm bill should look like. Which side is closer to the wishes of the Farm Bureau, the biggest general-interest agriculture group?

Right now, probably the House Agriculture Committee chairman, said bureau President Bob Stallman. Johanns advocated massive changes, Stallman said. "That, frankly, is not what our delegates are saying," he said.

Not that farmers are in lock-step. Illinois delegate Dale Hadden wants change and liked what Johanns said. With the Illinois River just a few miles from Hadden's corn and soybean fields, he ships most of his crop to the Gulf Coast for export.

"If we're going to be a player in international trade markets, we need to be sure we don't run into a lot of problems," Hadden said.

Among the disputes:

* Trade. The U.S. and other rich countries are under pressure around the world to reduce their farm subsidies. Conflict over the issue led to the collapse of World Trade Organization talks.

Without an agreement, American farmers face high tariffs and other barriers when they sell abroad -- and they export a big chunk of their output.

Against this backdrop, Johanns has pushed for change as U.S. farm programs come under fire. The WTO, in a case brought by Brazil, has ruled that some cotton subsidies are illegal. Canada is pursuing a complaint about U.S. corn subsidies.

"Now of course the temptation may be to say to the WTO, 'You know what, folks? Take a hike,' " Johanns told farmers.

"Now, surely there are people in this room who grow rice," he said. "Fifty percent of the rice that you grow goes into the international market. Do you want us to ignore the WTO and jeopardize that market?"

Peterson is disinclined to worry too much about the WTO.

"I want to write a farm bill that's good for agriculture," he said. "If somebody wants to sue us, we've got a lot of lawyers in Washington."

* Cost. There probably will be fewer dollars for farm programs when Congress writes the latest bill. The Democratic-run Congress is insisting on budget cuts to pay for new spending, and Bush has pledged to balance the budget in five years.

Johanns seems to be preparing lawmakers to do more with less. High subsidies, he told Farm Bureau members, do not necessarily equal a strong farm economy.

Peterson says agriculture somehow should be credited for wise spending. "We feel like we've done our part," he said.

* Payment limits. Johanns favors ending practices that allow some growers to collect millions of dollars annually above the $350,000 limit on payments.

He has broad support in Congress -- except from Southerners, who would feel limits more keenly because their cotton and rice crops cost more to grow and get higher subsidies.

Peterson said a farm bill could not pass without support from Southern lawmakers.

"I'm not interested in putting our agriculture friends in the South in trouble. They've got enough problems," he said.

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