Background: Farm Bill

KWAME HOLMAN:

Congress adopted a controversial free market approach to farm policy in 1996. Today the Senate prepared to abandon that philosophy, and return to the decades-old system of direct subsidies for American farming.

The reversal was lamented by the chief architect of the free market policy known as freedom to farm, Kansas Republican Pat Roberts.

SEN. PAT ROBERTS:

I had hoped that as we wrote this bill and looked in the rearview mirror of the past, we would resist the temptation to return to those policies. Sadly we seem to have done a u- turn.

KWAME HOLMAN:

Since the hard days of the Great Depression, farmers could rely on the federal government to provide a guaranteed minimum payment for their wheat, corn, and other crops when volatile market prices fell. But in 1996, facing a tight federal budget, lawmakers tried to save billions by ending the major crop subsidy programs, slowly weaning farmers off with a few years of limited payments. Pat Roberts then was Chairman of the House Agriculture Committee.

REP. PAT ROBERTS:

This bill establishes hopefully a market transition from the command-and-control style of government support to the free market through a series of fixed and declining payments, declining payments.

KWAME HOLMAN:

But government payments to farmers did not decline after the Freedom to Farm Act. Crop prices continued to stagnate. With what their crops brought in the marketplace, farmers were unable to make ends meet. Rather than allow another wave of farm failures, Congress stepped in each year to shore up American agriculture.

SPOKESMAN:

This chart shows the spending by crop year from 1996 on through 2002.

KWAME HOLMAN:

Pointing to the yearly bailouts, Iowa's Tom Harkin lauded members' work on the new farm bill that reinstates formal farm subsidies.

SEN. TOM HARKIN:

The bill is truly a product of cooperation and collaboration across party lines and across the capital between the two houses. It is a solid, balanced piece of legislation, a product of the crucible of rigorous debate, hard work and tough negotiating.

KWAME HOLMAN:

The House passed the new farm bill by a wide margin last week. But critics say the bill has become a free-spending catch-all designed to help both parties this election year in key farm states. President Bush endorsed the farm bill while campaigning for the Republican Senate candidate in South Dakota last month.

Senate Democratic leader Tom Daschle of South Dakota greeted the President there. Daschle helped write the new farm bill. The bill would spend $180 billion over ten years, a 70 percent increase over current levels of farm spending. Most would go to subsidize traditional wheat, corn, and rice crops. But new subsidies would be created for milk, lentils, and wool producers. Payments to individual farming operations would be capped at $360,000 a year, but critics say the bill allows some large producers to collect multiples of that amount. The bill also would restore food stamp eligibility to legal immigrants who lost that right in the welfare reform law, and fund new nutrition and land and water conservation programs.

SPOKESMAN:

The Senator from Indiana is recognized.

KWAME HOLMAN:

Indiana's Dick Lugar is one of several farm state Senators who oppose the bill. He said however well-intentioned the guarantee of help for farmers may be, the bill spends too much.

SEN. DICK LUGAR:

Whatever may be the desire for some certainty that a farmer can get almost two dollars a bushel for corn. The certainty for all other Americans is that we're going to have a larger deficit, that the prospects for solving Social Security and Medicare are setback, that we as trustees for the American people either do not understand that farm bills cannot be discussed in a vacuum, divorced from the rest of the world, or that we are so deliberate about our intent to spend this money, come hell or high water, that we plunge ahead.

KWAME HOLMAN:

Mike Enzi of Wyoming worried the new farm subsidies will violate U.S. trade agreements.

SEN. MIKE ENZI:

There are repercussions to this bill that move beyond our borders to other countries and our trading partners. We have a WTO, World Trade Organization, responsibility to our trading partners to keep our agricultural subsidies below 19.1 billion. In the past years we've stayed far below this level, but this bill threatens to send us over the top. It will be very difficult to convince our trading partners to lower their own subsidy levels– and they're starting to talk about that– and increase our access into their markets if we so boldly ramp up our own subsidy levels. They are watching.

KWAME HOLMAN:

But the wide breadth of the farm bill also helped to draw wide support. Minnesota's Paul Wellstone likes a provision aimed at creating jobs in rural communities.

SEN. PAUL WELLSTONE:

I am so pleased the telework provision's in there. Again it's my work and I'm bragging about it. You know what? I'm telling you something and setting up a telework institute, I'm telling you something. These information technology companies, I've heard it from many of them. They've said, listen, you know, we know the work ethic of people in rural America and we want to make sure that if you all are willing to do the grants and willing to get this going– and I think Minnesota can be a leader with Iowa and other states– then you know what? Again, we've got a real opportunity for people to be able out of their homes and out of a satellite office to work for companies halfway across the world, much less halfway across our own country.

KWAME HOLMAN:

In the end most Senators concluded the farm bill did more good than harm. The Senate voted 64-35 to approve it and sent it on to President Bush for his expected signature.