Wednesday, May 23, 2007

Much at stake in federal farm legislation

World trade issues are also expected to change how the next farm bill is written.

Frank Priestley is the president of the Idaho Farm Bureau.


Congress has recently taken up the discussion over farm support legislation and the predominant sentiment from beltway insiders is there will be less money and more people after it.

Every time a new Farm Bill is discussed—usually a five- to seven-year cycle—we can count, like clockwork, on a couple of occurrences. First, some select members of the news media will misunderstand, overstate and mislead the American public about the purpose of this legislation. And second, that so-called news coverage will convince some people to believe farmers are getting rich off the government.

However, simple facts can dispel these myths. Chief among them, consumers should know that the farm bill makes up less than 1 percent of the federal budget. The Congressional Budget Office (CBO) proposed baseline for agriculture programs in the 2008 farm bill is less than half of the amount Congress committed in the 2002 farm bill. This legislation encompasses much more than just issues that affect farmers and ranchers. It covers issues in which all Americans have a stake—alleviating hunger and poor nutrition; securing our nation's energy future; conserving natural resources; producing food, fuel and fiber; and promoting rural development.

Further, it provides a measure of stability in our food production system. U.S. consumers spend less than 11 percent of their disposable incomes on a nutritious, safe, quality food supply. No other nation can make that claim. The CBO projects that spending on commodity programs in the next farm bill will average $7 billion per year between 2008 and 2013, which translates to $23 per American per year, or about six cents per American per day.

In the 2002 farm bill, two-thirds of the money, $317 billion, was allotted for nutrition programs, $98.9 billion went to commodity programs, $21 billion went to conservation programs and $26.8 billion landed in the "other" category.

For 2007, overall spending is not expected to differentiate significantly. However, spending on commodity programs is expected to drop dramatically to almost half of what it was in 2002. Some of the money previously spent on commodity programs is expected to be allocated to the conservation title, and additional funds are expected to be spent on research and development of alternative energy systems.

Two more interesting developments in this farm bill package address the dearth of young farmers and ranchers. Farm Bureau supports two provisions that will make it easier for young farmers and ranchers to secure farm financing. Both are proposed by the Bush administration. The first doubles the Farm Service Agency's direct loan portfolio for beginning and socially disadvantaged farmers. The second initiates a beginning farmer down payment program that reduces interest rates on farm land.

World trade issues are also expected to change how the next farm bill is written. A proposal to allow vegetable crops to be planted on program acres is a serious concern to the Idaho potato industry because it could result in spud production increases and lower prices. The other side of the coin with this issue relates to a recent World Trade Organization ruling wherein Brazil challenged U.S. cotton industry support and won, putting many traditional farm support programs—including the vegetable planting prohibition—at risk in the context of the WTO.

It's not difficult to tell that this farm bill debate will be rancorous. It is difficult, complicated, far-reaching legislation that affects every American citizen. Given the choice, most farmers would take a pass on having any government involvement in agriculture. However, the production of food in this country has social costs attached resulting from state and federal regulations, like the Endangered Species Act, minimum wage, workers compensation, and dozens more that many of our competitors don't bother with. This dictates that our government must intervene in agricultural issues in order to maintain a safe, affordable and abundant food supply.

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