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.