For farmers: House farm bill maintains safety net

It doesn't contain everything they wanted, but legislation the House of Representatives passed Oct. 5 offers farm groups a more reliable safety net than they got from the Food Security Act of 1996.

The Farm Security Act of 2001 (H.R. 2646), approved by the House of Representatives by a margin of 291-120 (19 members did not vote), provides $170 billion over 10 years to strengthen production agriculture safeguards and add to conservation, commodity promotion and trade enhancement programs.

The House defeated a proposal (the Kind Amendment) that would have gutted the safety net provisions in favor of severe conservation measures.

H.R. 2646 completes a House Ag Committee two-and-a-half year effort that included research and testimony from hundreds of farmers and industry spokesmen across the nation.

“I hope we can get something similar out of the Senate,” says Donald Patman, Texas Farm Bureau president and a farmer from near Waxahachie.

“We were in Washington last week, working with the Texas congressional delegation to get this bill passed and to get the Kind Amendment defeated. We had good support from Texas representatives.”

Patman says HR 2646 retains some of the best parts of the Food Security Act of1996, with improvements such as target prices and counter cyclical payments. He says the legislation also gives the secretary of agriculture authority to reduce payment levels if funding would exceed $19.1 billion.

Patman says farmers desperately need the kind of safety net included in the House bill. “Prices are simply too low,” he says. “Cotton futures are trading at close to 31 cents per pound. With grade discounts, we may get no more than 21 cents per pound.”

“This was a good start,” says Roger Haldenby, a spokesman for Plains Cotton Growers, Incorporated, in Lubbock. “We got a bill through the House almost unscathed. It was not gutted or turned into a conservation bill, but it does include more than a 75 percent increase for conservation programs.

“Fortunately, however, the final bill did not include changes proposed in the Kind Amendment.” The proposal would have diverted as much as 80 percent of available funds to conservation measures.

The National Grain Sorghum Producers Association praised the bill for its flexibility, fairness and predictability. NGSP vice president Bill Kubecka, a producer from Palacios, Texas, says the organization also is pleased that the bill sets the grain sorghum loan rate at $1.89 per bushel, up from the current $1.71 and now equal to the corn loan.

NGSP leaders also applaud the safety net included in the bill, which, when combined withother provisions in the legislation, will result in more dollars to farmers.

Farm commodity groups say the bi-partisan support for this legislation should serve as a model for Senate debate. The bipartisan tone House Agriculture Committee Chairman Larry Combest, R-Texas, and Ranking Member Charlie Stenholm, D-Texas, set was critical to passage, industry observers say.

“This legislation continues the Freedom to Farm Act's direct payment program and marketing loans,” Stenholm says. “However, it adds a counter-cyclical program that makes payments when farm prices are low. It also creates a new peanut program to replace the old quota system.”

Combest explains the need for a revamped program.

“Our farmers are hurting,” he says. “Farm recession is now in its fourth year, ranking among the deepest in our nation's history. Recent crop prices are the lowest in 27 years for soybeans, the lowest in 25 years for cotton and the lowest in 14 years for wheat and corn.

“ In the past four years, farm net-cash income has fallen to the lowest level in real dollars since the Great Depression.

“In each of the past four years, rescuing the farm economy has cost over $30 billion in emergency federal farm aid. As we have seen, our current program is not working and substantial improvements are needed. The crisis in agriculture is real.”

He says critics do not realize that “having a strong food and fiber policy protects not only our farmers, but also consumers and national security. Predictable farm support programs allow farmer to make sound long-term financial decisions.”

The Farm Security Act covers a 10-year period and would add $73.5 billion to the baseline currently available in the federal budget for agricultural spending, Stenholm says.

“This legislation gives producers a choice to update their base acres and add counter-cyclical support based on target prices to the already established 2002 level of transition payments.”

The counter-cyclical payments are triggered when a crop's price, adjusted for the fixed, decoupled payment, is below the target price.

“This is an important part of the new bill, because, rather than continuing to rely on costly, short-term relief measures, a counter-cyclical income support as a permanent feature of farm policy would provide a level of stability from year to year,” Combest says.

“Some people have complained that the bill is too costly and that we should not spend the money right now. However, H.R. 2646 fully complies with the budget passed by this Congress.”

Stenholm says he's concerned about recent reports from the White House Office of Management and Budget indicating that the administration would not support the House farm bill.

“I don't have a good reading on what that means,” Patman says. “But I believe if the House and the Senate both pass a farm bill, President Bush will not veto it. In earlier meetings, he pledged that agriculture would be on the top of his priority list.”

Patman and others agree that the Sept. 11 terrorist attack has pushed many important items down the priority list. “Currently, the administration has bigger problems,” Patman says.

The scene now shifts to theSenate, which promises to be a tougher sell. Sen. Tom Harkin, D-Iowa, and Ranking minority member Richard Lugar, R-Indiana, lead The Senate Agriculture Committee. The Senate has not been as active in formulating an agricultural agenda as has the House, but following passage of the House bill, Harkin announced plans to report a mark-up bill by the end of October.

Some observers predict that recent retaliatory strikes against Afghanistan may delay action.

“This crisis may have an effect on the budget, as well,” Patman says. “But I felt better about our prospects after we visited Washington. I'm optimistic.

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