Posted on 05/14/2002 4:23:39 AM PDT by RJCogburn
President Bush reversed six years of Republican efforts to wean farmers from huge government subsidies, signing into law this morning a bill that increased those federal payments by at least $83 billion over the next 10 years.
Mr. Bush signed the bill at the Eisenhower Executive Office Building next door to the White House before traveling here.
"It's not a perfect bill, I know that," he told farm state lawmakers. "But, you know, no bill ever is."
Mr. Bush also said the bill would provide a safety net for farmers "without encouraging overproduction and depressing prices" while giving farmers an opportunity "to plan and operate based on market realities, not government dictates." Many of his aides, speaking on condition of anonymity, said that signing the bill was painful for a president who came to office promoting a government commitment to free markets. But one senior official traveling with Mr. Bush here today said it would have been "political suicide in the November election" to stand in the way of farm-state politicians who demanded huge increases in federal support after years of declining farm prices.
Republicans said in 1996 that the United States would spend far less on agricultural subsidies in coming decades. But the measure Mr. Bush signed into law today increased spending by nearly 80 percent over the cost of existing programs even though the budget deficit this year was likely to exceed $100 billion.
Mr. Bush called on lawmakers to show fiscal restraint, but the White House, aware that Republican victories in agricultural states could win back control of the Senate, made little effort to scale back the spending in this bill.
While the legislation must be renewed after six years to remain in effect, its estimated 10-year cost is $190 billion. The $83 billion in new spending is part of that cost, which includes increases in payments to farmers who produce wheat and corn and renewals of subsidies for wool, mohair and honey. The 1996 Freedom to Farm bill, pushed through by Republicans at the height of their legislative powers, was intended to limit such payments.
Many Republicans were urging Mr. Bush, up to the last moment, to veto the bill.
"We're stepping backward for farmers in this country," said Senator Sam Brownback of Kansas, one of 28 Senate Republicans who voted against the bill along with seven Democrats. But Senator Brownback is not up for re-election until 2004. Republicans from farm states who are running this year strongly supported the legislation.
"I would love to see him veto it," Senator Don Nickles, Republican of Oklahoma, said on Fox over the weekend. "It is a budget buster."
But other Republicans, including Representative Mike Pence of Indiana, praised the bill.
"The President recognizes the difficulties American farmers face, both from unfair trade barriers in other countries and tough economic times in the United States," Mr. Pence said.
"This new law will curb the need for ad hoc expenditures, increase funding for conservation programs, reduce payment limitations and enable additional agricultural research," said Mr. Pence, a member of the House Agriculture Committee. "I am confident that this farm bill will provide the necessary resources to keep farmers in Indiana and across America competitive in a global marketplace."
The push for new farm subsidies comes at a time when the administration is pushing European and Asian nations to reduce subsidies to their farmers.
"He has undercut the United States position greatly," said I. M. Destler, director of the center for security and economy policy at the University of Maryland and one of the country's leading historians of trade negotiations. "Until this year, we would have believed the trend was in the other direction. Now the Europeans will feel that they are no longer the stand-out sinners. The Japanese will feel relieved, and it's hard to imagine how it would be possible to negotiate a new global agreement" opening agricultural markets "at a moment that we are going the other way."
European officials say that the farm bill and Mr. Bush's decision to impose tariffs of up to 30 percent on imported steel suggest that the United States has taken a sharply protectionist turn even as it urges other nations to open up further.
But at the same time, European officials did little to reduce their subsidies in the six years since the passage of the Freedom to Farm bill. Nor did the Japanese. Also Congress passed emergency aid to farmers each year, which Mr. Bush argued today was "a bad fiscal habit." Those payments "created uncertainty for farmers and ranchers, and their creditors," he said.
He added, "The farm bill supports our commitment to open trade and complies with our obligations to the World Trade Organization."
Mr. Bush said the measure he signed into law "is generous enough to eliminate the need for supplemental support later this year and in the future," though farm lobbyists were likely to press for such additional help if prices continued to decline.
The European Union has already said that it is likely to challenge the new subsidies before the World Trade Organization, which has a trade court that adjudicates such disputes. But the new law gives the agriculture secretary, Ann M. Veneman, the power to adjust the subsidies to bring them in line with international agreements.
Under the organization's limits, American farm subsidies are limited to $19.1 billion annually.
Mr. Bush said nothing about the farm bill during his trip today to Chicago, which focused on welfare reform. His top political adviser, Karl Rove, told Republican senators recently that the president had favored a low-profile ceremony, to avoid drawing further attention to the bill, especially among conservatives who believed that it was too expensive and that it violated the party's free-trade principles.
Moments after signing the bill, Mr. Bush announced he would sign a major arms reduction agreement with Russia, news that was certain to reduce attention to the farm bill.
Mr. Bush also attended a fund-raiser for Jim Ryan, the Illinois attorney general who is running for governor.
"When we bring some fiscal discipline to Washington," Mr. Bush assured the audience, the revived federal budget deficits will come down.
I'll be here in November, and believe me if it works I will eat a king-sized portion of crow.
But if it does not work, and the GOP turns out to have traded its principles for s**t, I'll be the one dishing up the crow, big time.
Actually, the die-hard Bushophiles seem to be around these threads less and less. Perhaps because they get tired of dealing with "Bush-bashers" (which means anyone who may be critical of GWB)
I wonder, though, if it has to do with the series of actions that are harder and harder, in sum, to defend.
Why are Medicare/Medicaid reimbursements to physicians and pharmacies not considered welfare/subsidies to the medical industry but to the consumer?
Remember, elected officials/government types are obsessed with history and its tendency to repeat itself. Right or wrong, a longtime, unofficial “cheap food” partnership was enacted in the middle of the last century with a goal of eradicating famine that has been the grief and downfall of many a mighty nation. This unofficial, unspoken domestic policy disrupts the mechanisms of the marketplace and requires a relationship between consumers, producers and government because production agriculture can no longer receive the full value of its products from the marketplace.
As a result, farmers are kept from drawing realistic profit from the marketplace by passing on to the consumer the increased costs of production and over-regulation. The ruling body of the great Republic of France decreed that it was illegal to profit from the production of food amidst the “Let them eat cake” days. One year later, that country was ripped apart by revolution. The inability to feed its population contributed to the downfall of the Soviet Union. Right or wrong, this country has decided to utilize agriculture and cheap food as a political stabilizing device, but the farmer must still make a profit.
In recent days, I’ve heard many of the same folks who constantly call for a domestic oil supply and an end to dependence on Mideastern oil make comments about this farm bill that would have the U.S. dependent on an over-subsidized (yes, more than the U.S.), unregulated, and questionably safe foreign food supply (I’ve seen what they use for irrigation in foreign countries—wash your fruit WELL). Didn’t the king of Saudi just spend a few days in Texas holding oil over President Bush’s head? You don’t think the same thing would happen with food?
I've also been amused to hear certain people using the "X percent goes to the biggest/richest X percent" argument....these are the same people that fight that same argument when the libs throw it in our face about tax cuts...remember? Some people would have you believe that unless every farm, no matter how large or small, receives exactly the same dollar amount benefits, then commodity programs are unfair. But, all sizes of farms are adversely affected by events beyond their control, such as hail and insects (and EPA regs). The strong U.S. dollar reduces exports for all sizes. Rising input costs affect all sizes. Prices fall for all sizes. Large family farmers have more money invested in their crops, have more money at risk, and are more dependent on farm income than small farmers, who usually have other, "outside" farm income and farm either as a second occupation, a hobby, or a "lifestyle" decision. With high production costs, a large farm as defined by gross sales may not generate a large net farm income. So, it is only fair that large farms receive more program benefits than small farms. To do otherwise would be unfair (reeks of "redistributing" wealth). The correct way to look at the fairness of program benefits is to compare, by size of farm, the share of govt. benefits received relative to the share of program crop value produced. Based on USDA data (that the media fails to expand on), farms with gross sales of more than $100,000 produced 81.8 percent of the value of program crop production in 1998 and received 73.4 percent of govt. payments. In other words, the share of payments is only 90 percent of the share of program crop value for farms with gross sales of more than $100,000. For farms with gross sales less than $100,000, the share of payments received is 146 percent of program crop value. What's more, few farms are operated by non-family farm corporations. And, most farming corporations are family farm corporations--often incorporated because more than one family is involved in the farming oepration. According to USDA, only 2 percent of farms are "non-family" farms, and this category includes cooperatives owned by farmers and farms operated by hired managers--not just corporate farms. USDA data indicate that the share of farms and agricultural sales accounted for by non-family farms has been stable for decades. These "non-family" farms received 4.1 percent of govt. payments in 1998 and produced 4.3 percent of program crop value.
President Bush reversed six years of Republican efforts to wean farmers from huge government subsidies
Mr. Commissioner of Agriculture
My friend Robert, who lives in the Midwest, has received a $500,000 check from the government for not rearing any pigs this year. This is why I intend to join the program of non-rearing of pigs next year.
What I would like to know is what the best possible type of farm might be for not rearing pigs and what is the best breed of pig not to rear. I would prefer to not rear boars, but if this is not a good breed not to rear, I would be just as happy not rearing Landraces or Large Whites.
The hardest part of the work in this program then seems to keep a precise inventory of the number of pigs that have not been reared. My friend Robert is very confident with regard to the future of his business. He has reared pigs for more than 20 years, and the best he could earn was $200,000 in 1978; that is, until this year when he received $500,000 for not rearing any pigs at all.
If I can receive a check of $500,000 for not rearing 50 pigs, would I then receive $1,000,000 for not rearing 100 pigs, etc.?
I intend to start with a small operation and later grow up to not rearing 4000 pigs; which means I will receive a check of$4,000,000 , and I will then be able to invest in a yacht.
Now, one other thing is that those 4000 pigs I will not rear will not eat the 100,000 buckets of corn destined for their feeding. Should I then understand that you will pay the farmers for not producing the corn? In short, will you give me something for not producing the 100,000 buckets of corn that will not be fed to the 4000 pigs I will not rear?
I would like, on the other hand, to start as soon as possible, since it seems this time of year is propitious to not rear pigs.
Most sincerely, X.
"When we bring some fiscal discipline to Washington," Mr. Bush assured the audience, the revived federal budget deficits will come down.
But it's O.K. that Bush signed this bill really. Because, you see. . . he's a Republican. /sarcasm
Thanks for the more complete explanation of what is at stake.
I should also add that, by today's standards, gross sales of $100K do not a "large" farm make. If you're not running an operation of at least that scope, you're unable to support a family from the proceeds.
The harsh reality is that some of those farmers need to go out of business for prices to go up, but even then productivity will keep prices low. That's the long term effect of productivity increases, and in every major industry output per employee always goes up. Now if you want a job where productivity never increases, join the federal government.
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