Copyright 2002 The Houston Chronicle Publishing Company  
The Houston Chronicle
February 14, 2002, Thursday 3 STAR EDITION
SECTION: A; Pg. 5

LENGTH: 465 words

HEADLINE: Senate backs away from free market in passing of farm bill

SOURCE: Reuters News Service

DATELINE: WASHINGTON

BODY:
WASHINGTON - The U.S. Senate passed a $ 45 billion farm bill over White House objections on Wednesday that would step away from free-market reforms begun in 1985 and could violate world trade rules against excessive spending.

Grain, cotton and soybean subsidy spending would rise by $ 5 billion a year under the bill, passed on a 58-40 roll call in the Democratic-led Senate.

Meatpackers would be barred from raising the animals they slaughter and growers could not collect more than $ 275,000 a year in subsidies, 40 percent less than now allowed. Both were widely opposed provisions that faced further challenge.

In the next few weeks, the five-year Senate bill must be reconciled with the 10-year, $ 73.5 billion version passed Oct. 5 by the House so a final version can be sent to President Bush to sign.

Bush on Wednesday said the Senate bill "front-loads" spending and will hurt farmers in later years. By 2006, the bill would spend 61 percent of funding earmarked to last through 2011. But there was no threat of a veto.

"I am committed to sound farm policy that supports America's farmers and ranchers and am disappointed that the Senate-passed bill doesn't get the job done," Bush said.

Democrat Tom Harkin of Iowa, author of the Senate bill, said growers need help. "Farmers are bleeding right now," he said. "The problems are now, not eight years in the future."

Farm bills bundle crop subsidy, anti-hunger, farm export, agricultural research and rural development programs. The Senate bill included a provision, backed by the administration, to make legal immigrants eligible for food stamps again.

With the planting season near, farm groups want the new law enacted in time for this year's crops. Otherwise, they will seek a multibillion-dollar rescue like the stopgap aid costing $ 30.5 billion since late 1998 to offset low grain prices.

"It will do a lot for a rural America that is hurting right now," said Majority Leader Tom Daschle of South Dakota, who pressed to replace current farm law a year ahead of schedule.

The bailouts have kept farm income high. Although the White House warned against over-dependence on subsidies and the need to obey trade rules, lawmakers said higher farm spending was vital for rural America. Both parties vied to befriend the farm vote in advance of mid-term elections.

Like the Senate, the Republican-led House would spend $ 5 billion more a year on crop subsidies and release billions more if returns from sales were below targets set by law.

Revival of "target" prices would be a retreat from reforms, dating from 1985, that encouraged farmers to seek profits in the marketplace. The much-criticized 1996 "Freedom to Farm" law deregulated farming so growers could switch crops without jeopardizing their subsidies.



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