Des Moines Register
04-25-07
Farm Bureau backs revenue-based subsidies
Sen. Tom Harkin, D-Ia., is holding hearings today on commodity programs.
By PHILIP BRASHER
REGISTER WASHINGTON BUREAU
Washington, D.C. - Support is building among farmers for changing a subsidy
program so that growers are more likely to get payments when they have
weather-related crop losses.
The American Farm Bureau Federation is proposing to link subsidies known as
counter-cyclical payments to fluctuations in statewide farm revenue rather than
changes in commodity prices.
The proposal is similar to a proposal of the Bush administration and is less
sweeping than a revenue-based subsidy plan being pushed by the National Corn
Growers Association.
Under the existing system, farmers who lose crops to a drought stand to get little
in the way of federal subsidies at a time when commodity prices are well above
the levels that trigger payments. Prices for corn and other crops are expected to
remain relatively high because of the nation's booming biofuels industry.
"We need to keep this in the forefront," said Bob Bowman, a DeWitt farmer who
is president of the Iowa Corn Growers Association. "If we don't, there are too
many people that don't know the situation and circumstances, and probably
would just as soon, out of ease, continue the present farm program."
Congress is expected to begin work soon on a new farm bill to replace programs
that expire this fall. The Senate Agriculture Committee, chaired by Sen. Tom
Harkin, D-Ia., is holding a hearing on commodity programs today.
The Farm Bureau's proposals are designed to fit within the spending limits
lawmakers will have to follow unless Democratic congressional leaders come up
with spending cuts or tax increases to provide additional money.
The group's 56-page plan also calls for Congress to establish a permanent
disaster relief program to be funded with money now spent on crop insurance
and a fee on producers.
The new program would provide payments to farmers when they lose at least
half their crop.
Chad Hart, an agricultural economist at Iowa State University, said the plan
could turn out to be a wash financially for Iowa farmers while reducing revenue to
insurance companies.
Aside from the disaster program and revenue-based subsidies, the Farm Bureau
plan hews closely to existing programs.
The Farm Bureau opposes any new limits on payments to large farms.
"Farmers who produce more traditionally receive larger payments, but they also
take larger risks and have significantly higher investments in their farms," the
plan reads.
The Bush administration has proposed to cut off subsidies to farms with adjusted
gross income of $200,000 or more.
Reporter Philip Brasher can be reached at (202) 906-8138 or
pbrasher@dmreg.com