January 25, 2002
“We know time is not a luxury. We’ve got to get this thing done as soon as we can,” Mark Keenum, chief of staff for Sen. Thad Cochran, told growers at the 2002 Delta Ag Expo Jan. 23 in Cleveland, Miss.
The good news, he says, is that money is available for the 2002 crop, whether or not a new farm bill is passed in time to cover this year’s crop. “We’ve got the money one way or another. You’re either going to get it through a new farm bill, or you’re going to get it in another disaster payment.”
Keenum says, “If for some reason we get bogged down in conference, and we can’t get this bill finished in a manner that allows it to be implemented for this year’s 2002 crop, the President has committed to $7.5 billion of extra money for this year’s crop. So if we can’t get the bill passed, we do have AMTA monies for another disaster payment. Money, which we would argue, needs to be delivered to farmers this spring. We don’t want to wait until the end of harvest time to get this money to farmers. We’d like to see this money infused into the farm economy as quickly as is possible.”
The most direct route to getting a new farm bill passed, he says, is the quick passage of a farm bill by the Senate, moving the debate into conference.
“There is a desire to get back to the farm bill very quickly. I expect that action will be taken in the Senate on the Harkin Farm Bill proposal before the end of January. Then the bill will go to conference to make the two bills mesh and come together as one,” Keenum says.
“Our number one priority is to get a farm bill passed by the Senate, and get it into conference,” he says. “It took us nearly four weeks to conference the last farm bill. It takes a while to work out these differences. This farm bill probably won’t be any difference than that.”
Keenum is optimistic that a farm bill could emerge from conference by the beginning of March. “Then when we hand it to the Department of Agriculture, they’re going to have a fit because it’s going to at least allow farmers to update their bases, and possibly their yields. You think of all of the farmers and all of the county offices, and they are going to have to get busy in a hurry to get all of this implemented in time for the 2002 crop.”
Exactly what the 2002 Farm Bill will look like, and what its life span will be, are still up for debate. Keenum believes the farm legislation will include complete planting flexibility with no set aside rules, and will allow farmers to at least update their program bases, and possibly their program yields. It will probably also include some type of counter cyclical payment program, and some type of farm savings account provision.
The new farm bill, he says, will allow the continuation of fixed payments, but at a rate that will be vigorously debated in conference. Also to be worked out in conference are the marketing loan program rates.
“We could also have something that’s more akin to Senator Cochran’s farm bill proposal, with very high AMTA payments that are locked in at one level for the life of the farm bill,” Keenum says.
A big issue in the debate, he says, is the concern by some that the $73.5 billion in additional farm bill funding approved in 2001 to write the farm bill will evaporate in 2002. However, he says, “President Bush has committed to that not happening. Money will be not an issue in this farm bill.”
Also at issue, are the World Trade Organization’s (WTO) regulations concerning farm support payments. Under WTO, loan rates are “trade distorting amber box payments,” which are limited to $19.1 billion for the United States.
“We’re already bumping up against that limit, which could cause problems with increasing loan rates. To compound the problem, counter-cyclical payments also fall into this amber box. So, we may be passing policy that can’t be enacted,” Keenum says.
In comparison, he says, there is no WTO limit on green box payments, which includes direct AMTA payments. “That’s the reason, Cochran concentrated the assistance in his farm bill proposal on direct-payments.”
Both the House and Harkin’s Senate farm bill proposals include language that tells the Secretary to will administer these programs in a manner that does not violate our trade agreements.
“On one hand, you are passing policy that makes it very likely that we will violate our trade policies. And on the other hand, you’re telling us administer the program so we can’t violate our trade agreements,” he says. “That’s the situation we are facing, and both the loan rates and counter cyclical program are going to be big issues in the conference.”
Keenum adds, “Each camp is trying to blame the other camp on why we weren’t getting a farm bill passed. The bottom line is that we just ran out of time. If we had more time, and if we weren’t backed up to the holiday break, I’m convinced we would have passed the farm bill.”
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