U.S. Farm Subsidy Reform Favours Midwest

A plan to reform farm subsidies by guaranteeing revenue levels for farmers is a good deal for corn and soybeans growers but unfair to the rest of the country, senators from wheat states said.

The senators demanded changes in a package drawn up by the chairs of the House and Senate agriculture committees. Those leaders want to piggyback a $460-billion, five-year farm bill onto a deficit-cutting bill that could become law in December.

There s work to be done, said North Dakota Senator Kent Conrad, a Democrat, to make this fair for everybody. Senators Max Baucus, a Montana Democrat, and Pat Roberts, a Kansas Republican, also objected.

A Democratic Senate staff worker called the plan a boondoggle for corn growers and sequel to that other giveaway to corn agribusiness ethanol.

Leaders of the powerful agriculture committees are attempting to pull together a farm bill without the normal drawn-out hearings process.

Critics worry all the back-room dealings amount to an end run around usual rules of open debate and the result will be a costly and not very environmentally friendly program.

But the leaders of the agriculture committees say they need to seize the moment with the so-called super committee looking to find extensive budget savings.

This week is critical… for the agriculture committees to get this finalized, said Republican Charles Grassley of Iowa, a Senate agriculture committee member, on Nov. 8.

Crop subsidies are the chief area of dispute and the area where more than half of a proposed $23 billion in cuts would be made.

The committee leaders are touting revenue protection as the best way to accommodate budget cuts and provide a safety net for growers.

It would provide payments against shallow losses in crop revenue once growers absorb a decline of 10 per cent or so from average. Crop insurance would cover larger losses.

Crop insurance, however, is more affordable in the Midwest than other regions, so farmers outside the region would face higher costs.

We are committed to a strong crop insurance as the basic risk management tool, said Senate agriculture chairwoman Debbie Stabenow, Michigan Democrat. The question is when there are additional losses, what s the fairest way to do that?

Stabenow said the next farm bill would save money and make more land available for crops by reducing the size of the land-idling Conservation Reserve.

Farm bills set terms for farm subsidies, foreign food aid, agricultural research and land stewardship as well as public nutrition and food stamps.

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