FARM SUBSIDY BILL DECONSTRUCTED

The concept of farm subsidies has been a source of discussion for years. Designed originally to assist farmers to survive weather-related losses and the very real challenge of continuing to work in an agrarian commutity as the country increasingly became urban and suburban, as big corporations came in and turned small farms into large agri-business, farm subsidies came under fire. Among other things, farmers have been paid not to produce crops. Additionally, with the Free Trade Agreement with Mexico, subsidized corn has been sold to Mexico, undercutting small Mexican farmers and causing them to go bankrupt.

On the other side of the equation, food stamps and donated commodities for those in need are largely funded through the subsidized farm programs. These programs have helped individuals and families in need to feed their families.

So why do we need a new farm subsidy program, and do farmers continue to need subsidies? Here is an article from McClatchy that talks a bit about the new bill.

Fruits and vegetables reap rewards in House-approved farm bill
By MICHAEL DOYLE
McClatchy Newspapers

WASHINGTON | The House on Friday approved a farm bill that devotes record funds to fruits and vegetables while imposing subsidy changes denounced by critics as inadequate.

The House approved the bill by a 231-191 margin. Many Republicans actually support the underlying legislation but voted “no” because they opposed the last-minute addition of a tax provision. All of the Missouri and Kansas representatives voted for it.

The politics, prospects and policies of the measure are complex. Questions may outnumber answers.

Q. Should I care about this if I’m not a farmer?

A. Absolutely. For instance, the bill increases benefits for the Food Stamp program that serves 25 million U.S. residents, and it expands to all 50 states an after-school snack program.

Other impacts of federal policy on food price and availability grow are complicated. For instance, the bill pleases sugar producers by guaranteeing minimum prices. Consumers, though, pay more at the grocery because of this sugar policy, the nonpartisan Government Accountability Office has concluded.

Q. Who are the big winners?

A. Specialty crops, certainly. This means fruits, vegetables, wine — everything not covered by traditional crop subsidies. The bill counts $1.7 billion over five years for specialty crops. This is about quadruple the amount authorized in 2002. It would pay for research, school lunch purchases, promotion campaigns and more. It is also a long-term victory for industry groups like the Western Growers Association because this gets specialty crops into future farm bills as well.

Q. How about commodities such as cotton, rice and wheat?

A. Winners, all. The House bill largely retains the crop subsidy program written in 2002. Farmers will be able to collect several kinds of subsidies, which in 2005 totaled about $19 billion nationwide.

Q. Is Congress done?

A. Hardly. The Senate Agriculture, Nutrition and Forestry Committee must now write its own version of the bill. In theory, the Senate must finish in September so the House and Senate can reconcile their competing bills before the current farm bill expires on Sept. 30.

Q. Is President Bush happy with the bill?

A. Not yet. While saying that the White House “appreciates the progress” made so far, the Office of Management and budget warns that the current version would be vetoed. For instance, the Bush administration wants to ban subsidies to farmers with gross annual incomes greater than $200,000. The House bill sets the income limit for subsidy recipients at $1 million.