The Commission on 21st Century Production Agriculture Lays an Egg

The Commission on 21^st Century Production Agriculture, created by the 1996 Farm Bill, recently submitted its report on government's support of U.S. farmers, specifically those producing field crops such as wheat, corn, cotton, rice, and soybeans, in addition to producers of dairy, sugar, and peanuts. The commission's charge was to recommend directions for future farm policy to help provide guidance in preparation for consideration of the next farm bill in 2002.

Despite the forward-sounding name, the commission's recommendations sounded more like the same old songs that have been used for the last 70 years to justify government subsidies for and regulation of U.S. agriculture. The report goes on ad nauseam about how production agriculture is a "volatile industry," a situation which is used not only to justify a continuation of farm subsidies, but also leads the commission to recommend a radical expansion of the federal government's role in agriculture.

The commission seems convinced that it is the eternal responsibility of the federal government (i.e., the taxpayers) to provide farmers an income safety net that "provides a solid foundation of support for production agriculture."

Based on this 19^th century thinking, the commission recommends continuing the so-called "transition" payments for field crops (such as wheat, corn, cotton and rice) created by the 1996 farm bill. In less than five years since passage of the 1996 farm bill, most members of the commission seem to have forgotten that by definition, "transition" payments were not intended to become permanent. Instead, they were supposed to help "transition" producers of these crops to become less dependent upon the federal government.

Not satisfied with keeping the "transition" payments, the commission also recommends retaining both loan deficiency payments and marketing loans, in addition to removing any limitation on payments. On top of these existing subsidies, the commission recommends creating a Supplemental Income Support (SIS) program. That means that if the commission's recommendations become part of the next farm bill, farm subsidies will increase dramatically and an even greater percentage of those subsidies will go to the wealthiest farmers.

The commission's approach will make it even more difficult to wean farmers from the federal trough and is reminiscent of the original creation of farm programs back in the 1930's. Although those programs were supposedly only "emergency" legislation, they have become more permanent than Mount Rushmore.

In regard to specific commodities, the commission's recommendations for dairy, sugar and peanuts appear so vague as to be almost meaningless. Claiming that these are "commodities that have evolved into specific and unique agricultural programs," the commission does little more than identify "areas of concern that will have an impact on the economic well-being of the producers of these commodities."

The commission says nothing about the economic well-being of taxpayers and consumers. In fact, a closer examination of "policy options" outlined by the commission reveals that most of the so-called "options" will result in more government regulation, subsidy or both.

For dairy, the commission suggests looking at alternative price support mechanisms such as a marketing loan, a direct payment, mandatory supply controls and extension of dairy compacts beyond the existing regional authority. The only encouraging sign from the commission is that they included forward contracting and revenue insurance as options that should be considered, which is not enough to overcome the negative impact of the other recommendations.

For sugar, while the commission acknowledges the need for alternatives to the current sugar program, the only options provides are a marketing loan program, domestic marketing controls, domestic production controls and some form of direct payment to sugar producers.

For peanuts, the commission seems excessively concerned about "potential impacts on small landholders." The truth is that they are talking about preserving the archaic peanut quota system, which benefits quota holders more than peanut producers.

While the commission does suggest that a "phased reduction of the quota system, with compensation to existing quota holders" could be considered, they also suggest creating a new subsidy to "stimulate purchase of domestically grown peanuts" and a direct payment program for producers of quota peanuts.

In other words, don't eliminate these three programs; replace them with a different approach that continues to soak the taxpayers and consumers.

Frankly, the commission's report demonstrates that they have wasted the last five years, at a cost of close to $1 million. After basically suggesting a continuation of all kinds of subsidies and creation of new ones ¾ all of which will primarily benefit the wealthiest farmers ¾ as a "sop" to the political concern about the plight of "small family farmers," the commission proposes to institutionalize the USDA Advisory Committee on Small Farms.

The commission believes that creating a new bureaucratic agency is needed within USDA to help develop new programs to meet the "special needs of small and limited resource farmers." While probably not intended by the commission, this proposal is a naked admission that their other recommendations do nothing to help small farmers.

The minority view on farm income support policy filed by John B. Campbell, one of the commission's members, at least those comments recognize that farming has changed dramatically since farm programs were originally created. As Mr. Campbell's comments demonstrate, while "the average income of farm households in the 1990s exceeded the U.S. average household income," most of the programs being proposed are pretty much the same as 71 years ago. It's unfortunate that most other members of the commission seem to still be stuck in a 1934 time warp.

The result is a commission report that has no relevance to farming as it exists today, but which unfortunately will be used as justification for the perpetuation of government intervention in U.S. agriculture.