| WASHINGTON (AP) - Farmers need a new subsidy program to tide
them over when commodity prices are low, eliminating the need for annual
disaster bills, the chairman of the House Agriculture Committee said
Monday.
Rep. Larry Combest, R-Texas, said he has asked farm groups to develop
proposals for a payment program that could be implemented in 2002.
It's too late to have a new program ready for this year, although
farmers likely will need some emergency aid to compensate for low
commodity prices and rising energy costs, he said.
"I think the ag economy is much more fragile than most folks
realize," Combest said. "We are so fragile we are right on the
edge" of widespread farm failures.
The 1996 farm law was designed to phase out agricultural supports, but
Congress has provided three successive, multibillion-dollar bailouts of
the farm economy over the past three years. Some farm groups say a new
subsidy program is needed so farmers don't have to ask Congress for
additional aid each year.
Such a "countercyclical" program, in which payments would be
tied to declines in crop prices and farm income, would make it easier for
farmers to do financial planning each year, because they wouldn't have to
depend on predicting what Congress might do, said Combest.
"It gives them some certainty that there is something there if
they need some assistance," Combest said.
He plans to begin hearings on the issue next month. The 1996 farm law
expires in 2002 but Combest has said doesn't want to wait until then to
develop a new subsidy program.
The Bush administration isn't likely to offer its own proposals but
"is very supportive of what we are doing," Combest said.
Agriculture Secretary Ann Veneman has deflected questions about farm
policy.
Getting farmers to agree on a new program will be difficult, said Bob
Stallman, president of the American Farm Bureau Federation, the nation's
largest farm organization. A payment system popular with one region or
commodity may seem unfair to other producers.
One idea advanced by some Midwest lawmakers would offer growers higher
federal price supports in return for agreeing not to farm part of their
land.
"It's possible to come up with a countercyclical program,"
Stallman said. "Whether everyone is going to be happy, that's where
it's going to be tough."
The Agriculture Department estimates net farm income will fall 10
percent this year, or about $4.1 billion, without another package of
emergency aid from Congress.
Last year, farmers received $8 billion in emergency assistance from
Congress, boosting net farm income for the year to $45.4 billion. Average
farm income for the 1990s was $45.3 billion a year. |