Copyright 2001 The Omaha World-Herald Company  
Omaha World Herald (Nebraska)
November 16, 2001, Friday SUNRISE EDITION
SECTION: BUSINESS; Pg. 4D;

LENGTH: 725 words

HEADLINE: Democrats push crop subsidies through committee over criticism

BYLINE: By Jake Thompson

SOURCE: WORLD-HERALD BUREAU

DATELINE: WASHINGTON

BODY:
Democrats on Thursday herded a new five-year farm bill through the Senate Agriculture Committee over GOP complaints that it would continue huge subsidies, encourage overproduction and keep prices low.

"I think it's a good day for Iowa and all farmers," said Committee Chairman Tom Harkin, D-Iowa.

Harkin won key last-minute support from Southerners by dropping his attempt to limit payments to grain and cotton farmers, some of whom have received hundreds of thousands of dollars in subsidies in recent years.

Sen. Ben Nelson, D-Neb., who signaled support for limits, said woeful economic conditions in agriculture called for moving the bill now to the full Senate.

"Given where we are today, this is the bill we have to have," Nelson said.

It isn't just a farm bill, he said. One in four Nebraska jobs is linked to agriculture.

But Sen. Pat Roberts, R-Kan., called it a step "back to the past."

Last month, the House passed a $ 170 billion, 10-year overhaul to replace existing programs that expire next year. The Senate Agriculture Committee bill, passed on a voice vote, spends slightly more in five years and would have to be renewed then.

Congress is plowing forward despite pleas from the White House to delay the farm bill until next year out of concerns about the cost of the war on terrorism.

The bill faces further challenges. Immediately after the Agriculture Committee's move, Sens. Patrick Leahy of Vermont and Harry Reid of Nevada, both Democrats, said they'll try to alter the bill on the floor to boost conservation spending to $ 5 billion from $ 2 billion.

That probably would trim subsidies for corn, wheat, rice, soybeans and cotton. Such groups as the Environmental Working Group, Environmental Defense and wildlife organizations back the conservation increases.

Harkin called his bill a balanced approach that provides a farm-income safety net, money for conservation, promotion of wind energy and ethanol, and rural development assistance.

He called it a "nudge" away from 1996's Freedom to Farm law, which sought to phase out subsidies but failed because prices plunged amid a worldwide grain glut, and Congress stepped in with four multibillion-dollar bailouts.

Sen. Richard Lugar, R-Ind., complained bitterly during debate Thursday that Harkin's bill would only continue the cycle of overproduction and give subsidies as large as $ 3 million a year to single farms.

Lugar is considering proposing a bill that would phase out subsidies and instead offer vouchers farmers could use to buy insurance to protect against sharp price declines or disasters. The Bush administration has endorsed the idea, but no major farm group has followed suit.

Nelson said European farmers still receive eight times more in government subsidies than U.S. farmers. To stay competitive, the income supports need to stay in place, he said, although he'd consider altering how they are handed out.

"There isn't a person around who wouldn't want to have government completely out of agriculture and let the economy work," Nelson said. "But the fact that it doesn't work is the reason why government tries to step in with an intervention here to do it in a fair-minded way."

Family-farm groups had urged the Senate panel to curb large subsidy payments so small and medium-size family farmers might get more federal help.

A recent poll by the Farm Foundation indicated that 81 percent of farmers want the payments targeted to small and medium-size farms.

Chuck Hassebrook, director of the Center for Rural Affairs in Walthill, Neb., said he was disappointed in action taken by Congress so far. It will shift even more subsidies to large operations, he said.

"A small number of very large and very powerful farms have hijacked democracy," he said.

The Harkin bill provides for three kinds of subsidies for grain and cotton growers, including a new one called a "countercyclical" subsidy kicking in when prices fall below certain targets.

The bill also has $ 550 million for new energy development to open new market uses of ethanol, biomass and wind.

Rural development money would rise in part to set up national rural cooperatives and businesses to boost investment in rural America and expand broadband access.



LOAD-DATE: November 16, 2001