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Farm bill battle continues

The Bush administration tried to keep Congress from acting until next year by convincing some farms groups to back their effort, but Sen. Kent Conrad, D-N.D., became furious with those groups. Senate Agriculture Committee Chairman Tom Harkin, D-S.D., began to show farm groups a draft of his farm bill, and Sen. Byron Dorgan, D-N.D., said there should be a $4 target price for wheat. Dorgan said the House bill claims a $4.05 target price, but that it really only would be $3.57 because it covers 85 percent of production.

White House visitor

Meanwhile, North Dakota Gov. John Hoeven showed up in Washington to lobby the Bush administration in favor of the Senate passing the House bill. Dorgan told Agweek the House bill is "a step forward" but that a bill that does more for North Dakota is needed. Dorgan also said that if the Senate Agriculture Committee does not write a bill, Senate Majority Leader Tom Daschle, D-S.D., could bring the House bill to the floor for action and amendment. Dorgan said it would be better if the Senate Agriculture Committee writes the bill, however.

Bush administration officials invited leaders of farm groups dissatisfied with the House farm bill to the White House Oct. 19 and convinced them to send a letter to Daschle, urging him to go slow with the farm bill. But a lobbyist for the one of the groups involved said that if Harkin writes a farm bill the groups like better than the House-passed bill, at least some of them will abandon the White House effort in favor of passage this year. The lobbyist said the letter was "a bone to the administration."

The lobbyist said the farm groups represented at the White House Oct. 20 were the American Soybean Association, the National Corn Growers Association, cattle, pork and poultry groups and the United Fresh Fruit and Vegetable Association. The same groups sent a letter to Daschle Oct. 23 saying that the Bush administration "has provided assurances that the resources necessary to fund a farm bill above the current baseline will be available next year. In light of this commitment, we would support the Senate Agriculture Committee continuing a deliberative process with a goal of reaching Senate passage early in the second session of the 107th Congress."

When Senate Agriculture Committee ranking member Richard Lugar, R-Ind., introduced his farm bill Oct. 17, Agriculture Secretary Ann Veneman said the administration was committed to spending an additional $25 billion over five years on agriculture, but Office of Management and Budget Director Mitch Daniels told Jim Wiesemeyer, an analyst with Sparks Cos., in an interview published Oct. 20 that the administration would spend more than the $25 billion if it agreed with the new policy. Senate Democrats have said they want to stick to the $73.5 billion in new spending promised over 10 years in the congressional budget resolution, but Lugar has said that is too much money.

The White House meeting astonished some political observers because it did not include the American Farm Bureau Federation, the largest farm group in the country. The Farm Bureau worked hard to get the House to pass the farm bill and, since its passage, has been putting pressure on the Senate to take action. The Farm Bureau is continuing its lobbying efforts in favor of passage this year.

Letter draws criticism

Conrad, who chairs the Senate Budget Committee and has been pushing for passage of the bill this year, expressed fury with the farm groups that signed the letter. Conrad said, "I have never been so disappointed in farm groups as in the farm organizations that wrote this letter." Conrad called the administration's statement of the money being available next year "meaningless" because Congress, not the executive branch, writes the congressional budget resolution. Conrad said the farm groups that wrote the letter had "bought a pig in a poke" and described what they had done as a "dereliction of duty" to the farmers they represent.

The lobbyist who said the groups would support a Harkin proposal if they liked it also pointed out that White House has not said what commodity, income support and risk management policies it would support. The leaders who went to the White House told the Bush officials not to support the policies in the Lugar farm bill, which would end the Freedom to Farm payments, phase out marketing loans and introduce a new farm income support bill that would include farmers who grow products besides the traditional program crops. The Lugar proposal -- and others backed by environmental groups --also are likely to reduce the amount of money the federal government spends on farm programs in the Plains states and the South in favor of spending more in the coastal states where fruit and vegetable producers have been complaining they have been hurt by imports and competition overseas and where Conservation Reserve Program costs and easements to keep farmland from being sold for housing and commercial development are more expensive because the value of land is so high. Veneman pointedly told farm broadcasters in an interview Oct. 23 that the administration is exploring other ideas. She also gave her deadline for finishing the farm bill as September 2002, just before the current law expires.

Harkin has not yet released his proposal, but documents made available to Agweek show that Harkin is considering a farm bill proposal that would more than double federal expenditures on marketing loans and loan deficiency payments, but there may be a limitation on the amounts. Lobbyists who made the proposal available stressed that the Harkin plan still is in development and it could change before he issues it publicly, which may occur this week. Democratic Senate Agriculture Committee staffers worked as best they could last week away from the Capitol because of the anthrax scare, the lobbyists said, and had been doing financial calculations by hand because they do not have normal access to Congressional Budget Office computers.

Harkin's proposal would extend Freedom to Farm payments, raise all loan rates from current levels except those for oilseeds and include a countercyclical proposal. The Freedom to Farm payments would reflect the cost of production for different crops and would be made for oilseeds as well as traditional program crops. The spending on marketing loans and loan deficiency payments would more than double from $23 billion to $49 billion.

Harkin also is studying a limitation on loan and deficiency payments based on maximum production for each crop -- rather than based on a dollar amount. The current dollar limit is $75,000 per recipient, and the House-passed farm bill changes that to $150,000. The counter-

cyclical program would be constructed crop-by-crop rather than state-by-state, and payments would be determined by the difference between a base period of 1998-2001 and the current year, which is similar to the program proposed last year by House Agriculture Committee ranking member Charles Stenholm, D-Texas.

Harkin is considering constructing the limit by figuring the top 3 percent to 5 percent of largest production quantity the farm has reported and excluding production in excess of 95 percent to 97 percent from the payments. Harkin also is considering a payment limitation based on all programs from which the farmer receives money. The source also said Harkin plans to spend $100 billion on commodity programs over 10 years, rather than the $110 billion in the House bill.