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The idea behind President Bush’s proposal to limit crop subsidies is to stop big corporate farming operations from gobbling up most of the government payments, but smaller farmers say they’d be hurt too.
“If you want to do away with family farms, do away with subsidies,” said Daryl Burney, a cotton farmer with a 1,000-acre operation in Coffeeville, Miss. “We’re dependent on subsidies to survive. The profit margin on the farm is so narrow right now, you can’t afford any mistakes.”
Bush wants to lower the maximum amount that farmers may collect, which Burney said would cut into his income. Burney’s subsidy checks don’t always reach the current limit, but, he said, they come close enough that “we would blow the cap slap off” under the president’s new budget.
As part of his budget for the next fiscal year beginning Oct. 1, Bush on Monday proposed dropping payment ceilings from $360,000 to $250,000 and closing loopholes that have allowed some to claim millions of dollars in payments. He also called for an across-the-board cut of 5 percent for all farm payments.
“That will save the American taxpayer $1.2 billion over the next decade,” Bush said Tuesday in a speech to the Detroit Economic Club. “These are the kind of reforms that are necessary to earn the trust of the American people.”
Southerners like Burney would feel new limits more keenly because their crops of rice and cotton cost more to grow and get higher subsidies. They’re not alone. Growers of other commodities – wheat, corn, soybeans – say they can’t withstand cuts of any kind now that prices for many of their crops are falling.
The president already has a fight on his hands. Southern growers have friends in high places, among them Senate Appropriations Committee Chairman Thad Cochran, R-Miss., and Senate Agriculture Committee Chairman Saxby Chambliss, R-Ga.
Cochran criticized the budget plan for attempting to cut Southern agriculture “while leaving other regions largely untouched by the budget knife.”
Chambliss said it’s unfair to slash crop subsidies without reducing payments that other farmers get through conservation programs. “Does that treat all farmers fairly? I don’t think so,” he said.
Still, there is plenty of support in Congress for limiting payments. Both the House and Senate voted by wide margins for a strict $275,000 cap when lawmakers debated the 2002 farm bill.
But with both parties at that time seeking a farm vote crucial to the outcome of the 2002 midterm elections, House and Senate negotiators upped the ceiling to $360,000 and left loopholes that have allowed some to claim millions of dollars in payments, all with the acquiescence of the White House.
Now, those who have wanted to close the loopholes have a new ally in Bush. Sen. Charles Grassley, who has led the effort to limit payments, said the president is serious.
“The administration showed no interest in it until now. They’re looking for ways to save money, and this is one of the most intellectually honest ways to save money,” said Grassley, R-Iowa. “They came to us.”
Rural groups and environmental advocates say the current system encourages big farming operations to grow bigger, squashing smaller operations in the process.
“The way the big boys grow is by buying up their weaker, smaller neighbor,” said Ken Cook, president of Environmental Defense, an advocacy group that analyzes Agriculture Department programs. “If you’re getting a constant flow of big government checks, that gives you just that more of an edge to invest when someone sells a farm.”
Grassley and other supporters could attempt to circumvent the Southerners’ opposition by going through the Senate Budget Committee. Chairman Judd Gregg, R-N.H., said earlier this week he’s not an agriculture specialist and referred questions to Chambliss.
Bush’s proposed farm cuts also will be a tough sell in the House, said Republican Rep. Jo Ann Emerson, a member of the House Appropriations Committee’s farm spending panel.
“Changing the payment limitation scheme would force us to open up the whole farm bill, and once you open that up, it’s like a can of worms,” said Emerson, who represents rice and cotton growers in southeast Missouri.