Des Moines Register 01-31-07 Bush's farm bill would give more money to Iowa By PHILIP BRASHER REGISTER WASHINGTON BUREAU Washington, D.C. — The Bush administration today proposed an overhaul of farm programs that could direct a little more money to Iowa producers. The plan would shift some money from price-based crop subsidy programs and increase the fixed annual payments that corn and soybean growers receive by 7 percent. Another proposal would alter a key subsidy program so that it better protects farm income when widespread crop losses cause commodity prices to rise. The plan “actually could mean more money for Iowa farmers, if we think corn and soybean prices are going to stay high because of ethanol,” said Bruce Babcock, director of Iowa State University’s Center for Agricultural and Rural Development. Agriculture Secretary Mike Johanns said the plan will address complaints by farmers in Brazil, Canada and other countries that U.S. subsidies unfairly encourage overproduction and drive down commodity prices. The proposals will “distribute resources more equitably among producers and among commodities,” he said. The plan would cost taxpayers $2 billion a year less than the current farm bill has, but that savings is mostly due to the relatively high prices of corn and other commodities. The plan would cut off payments to individuals and businesses with adjusted gross incomes over $200,000. It’s not clear how many producers in Iowa that would affect, said Chad Hart, an Iowa State economist. The means-testing proposal would save about $150 million a year nationwide by eliminating payments to 80,000 recipients. The proposals are certain to get close scrutiny from farmers, landowners and bankers in Iowa. Iowa growers and landowners collected $2.24 billion in federal subsidies in 2005, about 10 percent of the total payments distributed nationwide, according to the U.S. Agriculture Department. That total included $508 million in fixed payments. Farmers receive about $33 per acre on land that has historically grown corn. Payments for soybean land average about $15 an acre. Under the administration’s plans those payments would rise by 7 percent, starting in 2010. Farmers could get another 10 percent increase if they perform some conservation work on their land and give up certain price-based crop subsidies. The administration's proposals face an uncertain future on Capitol Hill. The 2002 farm bill expires this year, and many farm groups have been pushing Congress to continue the existing subsidy programs. “Farm Bureau members from across the country have repeatedly and strongly emphasized the need to keep the 2007 farm bill consistent and very similar to the concepts in the current bill,” said Bob Stallman, president of the American Farm Bureau Federation. Critics, however, have said existing farm programs disproportionately benefit large grain and cotton farms to the detriment of fruit and vegetable growers and conservation needs. A leading advocate for changing farm programs, Ken Cook, president of the Environmental Working Group, praised the administration for having “planted the flag of reform.” The administration’s plan would offer more money to aid fruit and vegetable growers, who receive little in the way of subsidies now, as well as earmark grants and loan guarantees for biofuels research. Other highlights: • Land idled under the Conservation Reserve Program could be planted to grass and other crops that could be used for making ethanol. USDA estimates that about 27 million acres of CRP land could be planted to biomass crops. • The Conservation Security Program championed by Sen. Tom Harkin, D-Ia., would be increased from 15.5 million to 96.5 million acres, or about 10 percent of the eligible land nationwide, by 2017. • Subsidies for milk would continue but at reduced rates, and the payments would be based on past production. • Grain and cotton farmers could convert acreage to fruits and vegetables about losing subsidies.