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October 2006

Farm Bill Extension Gives Producers More Solid Footing

Bob Stallman
American Farm Bureau
By Bob Stallman
President, American Farm Bureau

There is no question that the existing farm bill is popular with farmers and ranchers throughout the country. Like a dependable pair of work boots, it helps keep us on solid footing. Maintaining the farm bill’s structure and funding is a high priority for Farm Bureau.

Earlier this year, American Farm Bureau Federation delegates overwhelmingly voted in support of extending the current farm bill until a new world trade agreement is reached.

The outcome of the negotiations, particularly as they relate to domestic support, must be known and taken into account before we begin crafting a new farm bill for many reasons.

Striking a Deal

The United States’ primary negotiating tool in world trade talks is reductions in our domestic support programs. If we go ahead and reduce our domestic supports through a new farm bill, we have less leverage to convince other countries to reduce their tariffs and export subsidies. With foreign tariffs averaging 62 percent on our agricultural exports – more than five times higher than the average U.S.-imposed agricultural tariff of 12 percent – our strongest negotiating power is to maintain our current programs until we agree to a world trade deal beneficial for American agriculture.

Our members are willing to lower farm program payments via world trade negotiations if – and only if – they can secure increased opportunities to sell their products overseas. However, we are not willing to unilaterally disarm.

Since the world trade talks were indefinitely suspended in July and it is uncertain when the talks will resume, Farm Bureau is seeking an extension of the current farm bill for at least one year. In the meantime, U.S. farm policy should continue to help level the playing field for America’s farmers until trade negotiations achieve a truly fairer world market.

Beyond International Trade

Beyond the international trade implications and the loss of negotiating leverage, there are other reasons to extend this farm bill. The 2002 farm bill was carefully constructed to provide support for commodity, conservation, nutrition and export promotion programs. Congress struck a balance in funding each of those programs and it works. As the saying goes: If it ain’t broke, don’t fix it.

Our farm bill provides an adequate safety net to farmers and ranchers when commodity prices are low, and just as importantly, it continues to address the goal of producing a safe, abundant, domestic food supply.

Finally, production expenses, such as fuel and fertilizer, are expected to be much higher for the upcoming farm bill period than was the case during this farm bill. With a significantly higher cost structure, and at a time when farmers are making investments to help secure our nation’s energy future, changing our farm bill would be like trying to break-in a new pair of boots in the middle of a long hot workday on the farm. Right now we can do without the shine. What we need is the good, solid, dependable footing.