U. S. Senate Panel Rejects $250,000 Farm Subsidy Cap

The Senate Budget Committee rejected a proposed $250,000-a-year limit on farm subsidies March 26 in a rebuff to reformers and the Obama administration.

President Barack Obama proposed a $250,000 payment cap in his fiscal 2010 budget plan. It was part of a package of farm cuts estimated to save nearly $16 billion over 10 years that found little support in Congress.

Iowa Senator Charles Grassley, a longtime backer of payment limits, lost 10 to 13 in a committee vote when he proposed a $250,000-a-year cap. Grassley said the limit would focus the farm program on family-size farms.

Crop subsidies are based on volume of production of grain, cotton and oilseeds, so big operators get the lion’s share of the money.

The panel voted, 14-10, for an amendment by chairman Kent Conrad of North Dakota to reduce spending on federally subsidized crop insurance by $350 million. That may result in a requirement for the Agriculture Committee to cut farm spending, depending on the final terms of Congress’s spending plan.

“Later this year, we’ll be having the same debate in another committee,” said Ferd Hoefner of the National Sustainable Agriculture Coalition, which says big farmers use crop subsidies as a bankroll to outbid smaller neighbours.

The largest U. S. farm groups oppose Obama’s cuts as an attempt to rewrite the 2008 farm law before it is implemented. The law includes the first-ever ban on crop subsidies to the wealthiest Americans and requires payments to be tracked to individuals.

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