For the week of June 10, 1996

Unfair Budget Cuts Hit Agriculture

By Stewart Truelsen

Congress may want to change the name of the 1996 farm bill. It's now known as the FAIR Act, an acronym for Federal Agriculture Improvement and Reform Act. If the actions of the House agriculture appropriations subcommittee are any indicator, the farm bill could soon be tagged as the Un-FAIR Act.

The ink was barely dry on the bill that was signed into law April 4th when appropriators decided to make cuts in the budget for fiscal year 1997. What they did was cut $98 million from market transition payments, knocked $20 million off the new environmental quality incentive program and capped sugar price supports. An important change in crop planting rules was also made. Earlier, the subcommittee reduced so-called discretionary spending on agriculture by $600 million.

If the actions of the subcommittee hold up in some fashion, Congress will have breached its contract with the nation's farmers even before many of them have a chance to sign their names to it. Sign-up extends through July 12. Farmers who sign up are under the impression they will receive fixed but declining payments for the next seven years.

House Speaker Newt Gingrich, Agriculture Secretary Dan Glickman and others are confident the cuts will be restored in current budget battles. However, farmers have already had their faith in the new farm bill badly shaken, and the FAIR Act has seven years to run. Even if funding for agriculture is restored for 1997, what's to keep Congress from coming back with even larger cuts in the years ahead?

Some members of Congress argue that ag spending should be cut while crop prices are high, but this isn't the bargain they made with farmers. The new farm bill was sold to farmers with the idea that farm program spending would be dramatically cut, but the levels would be fixed through the year 2002. Crop prices are irrelevant under the new farm bill.

When the farm bill was being discussed last year, farmers were also led to believe they would receive tax relief and reform of burdensome federal regulations. These issues are still locked in partisan debate. Now, the promises made about agricultural spending also have a hollow ring to them.

Sign-up for production contracts under the FAIR Act is said to be going quite well. Let's hope that fairness is more than just a catchy title. If not, this will soon be the Un-FAIR Act.

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Stewart Truelsen is director of broadcast services for the American Farm Bureau Federation.