Govt. Would Pay Less to Wealthy Farmers

Published 12:00 am Monday, December 26, 2005

WASHINGTON – Government payouts to the wealthiest farmers would be blocked in a House committee’s version of a wide-ranging, five-year farm bill.

The House Agriculture Committee approved amendments on Wednesday that would limit payments to wealthy farmers as part of the overall legislation, which provides cash and other help to supplement farmers’ incomes, support crop prices and manage supplies. Current law overseeing Agriculture Department programs expires in September.

The limits are a response to a growing number of critics, including the Bush administration, who say the country’s farm subsidies need a major overhaul.

Email newsletter signup

The legislation, by House Agriculture Chairman Collin Peterson, D-Minn., would ban payments to those who make an average of $1 million or more a year over three years and eliminate provisions that allow some farmers to collect payments for several different properties. Current law would limit payments to those with an average income of more than $2.5 million.

At the same time, the bill would increase the maximum limit on direct payments, subsidies that are not based on current crop production or prices.

Peterson said the proposal “is a sound compromise that no one is satisfied with but nonetheless represents real reform,” adding that the payment limits are expected to save the government $226 million over five years.

But that is not enough for some critics who are hoping to wean farmers off subsidies altogether. Wisconsin Rep. Ron Kind, a Democrat, said Peterson’s proposals are “a far cry from meaningful reform.”

“Simply limiting payments to farmers whose adjusted gross income is $1 million will not get to the heart of the problems with commodity programs,” Kind said. “It will do very little to make our agriculture policies more equitable, will not address the real challenges we face at the WTO, and it will not do anything to help our farmers produce for the market rather than for the government paycheck.”

Kind is working to gather votes for his own proposal, which would replace subsidies with savings accounts that farmers could use to cover losses when crop prices are low or yields are poor. Kind won 200 votes for a similar plan during the debate on the 2002 bill.

One of his supporters that year was California Rep. Nancy Pelosi, now the Democratic speaker of the House. She is working with Peterson on the farm legislation in hopes that Democrats can remain united when the bill hits the House floor.

Agriculture Secretary Mike Johanns has also been critical of the committee’s attempts at reform. The administration has put forward its own proposals, including a limit on payments to farmers who earn an average of more than $200,000 a year.

Earlier this week, Johanns said the committee’s bill is a “missed opportunity” for reform. On Wednesday, as the committee considered the payment limitations, Deputy Agriculture Secretary Charles Conner said the department is pleased that Peterson appears to be moving in the right direction.

Still, Conner said, “we have a long way to go on this.”

Kind, Johanns and other critics say tight budgets and recent high prices for corn and other crops create an opportunity to save money on farm programs. But farm groups say farmers will need a safety net if prices drop.

Peterson said he hopes the bill will make it to the House floor before the August recess. The Senate has not yet moved on the legislation.

The House bill would also:

_Boost support for fruit and vegetable producers, including research and marketing assistance and increased government purchases.

_Authorize federal nutrition programs, including food stamps.

_Give more dollars to some conservation programs, which encourage farmers to protect environmentally sensitive land.

_Provide loan guarantees for the development of refineries that process renewable fuels.

A service of the Associated Press(AP)