Thursday, March 27, 2008

Prospects for Farm Bill reform look dead to Wall Street Journal, but Grassley says he's still trying

Republican Sen. Charles Grassley of Iowa is making a last-ditch effort to put stricter limits on commodity subsidies in the new Farm Bill, reports Dan Looker of Agriculture Online: "Grassley likes a four-point plan put forth by the Center for Rural Affairs of Lyons, Neb.," and is pushing Democratic Sen. Tom Harkin of Iowa and Agriculture Secretary Chuck Conner to consider it.

"The Center's plan drops any effort to put a hard cap of $250,000 on payment limits but it could potentially save about $1 billion over 10 years, the nonprofit advocacy group's executive director, Chuck Hassebrook, told Agriculture Online Wednesday. And it also considers regional differences in agriculture, accounting for potentially higher production costs and values for such Southern crops as cotton, rice and peanuts," Looker writes.

The plan also includes "tougher requirements that people must be actively engaged in farming in order to receive commodity payments," an income limit for subsidy recipients, and lower limits on direct payments when prices are high, Looker reports. (Read more) UPDATE, March 28: The plan is "an effort to keep wealthy urban landlords from cashing in on federal farm programs," writes Dien Judge of the Iowa Independent, with a link to a statement from Grassley and Democratic Sen. Byron Dorgan of North Dakota.

This morning, Lauren Etter and Greg Hitt of the Wall Street Journal delivered a long but clear explanation of how lobbying and politics, "at least so far," have quashed prospects for major reforms in farm programs, prospects that looked good a year ago. "Influential interest groups, which had toyed with supporting changes, cut deals to get their own piece of the action," write. "Lawmakers who supported an overhaul peeled off as the debate moved into the election year. Historical alliances between rural and urban lawmakers proved difficult to untie. The agribusiness industry plowed more than $80 million into lobbying last year, according to the nonprofit Center for Responsive Politics, which tracks spending on lobbying. Much of that was focused on the Farm Bill." Lobbyists and farmers say the bill provides "a safety net through cycles of boom and bust." (Read more)

The article is accompanied by several interesting graphics, such as this one, showing how farm households' income has outpaced that of non-farm households since 1996. The last two red lines are forecasts of farm household income for 2007 (which has not been compiled yet) and 2008. Other graphics show the states and congressional districts that get the most money from farm subsidies, and the share of their gross domestic product that comes from agriculture. Most of the data come from the Environmental Working Group, which maintains a searchable database of subsidy recipients.

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