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Federal supplemental payments: $5 billion for ag in 2001

The U.S. Congress likely will provide up to $5 billion for supplemental payments to farmers this year to offset low commodity prices and rising input costs.

“That should be in the budget as a supplemental AMTA payment,” says Rep. Charlie Stenholm, a Texas Democrat and ranking member of the House Agriculture Committee. The payments would be in addition to any emergency assistance Congress appropriates.

Stenholm was in his district during the two-week Easter recess, taking care of his own cotton farm and speaking to constituents. He spent time following an engagement at the Mineral Wells, Texas, Chamber of Commerce to discuss agricultural issues with Farm Press.

Stenholm says he'll have no role in a budget conference committee to reconcile differences between the House and Senate. But he's hopeful that negotiations will result in moving the Senate agricultural budget resolution closer to the House version.

“The House has provided virtually a blank check for agriculture, up to $500 billion for the next 10 years,” Stenholm says.

He says agriculture needs at least $100 billion over the next 10 years to take care of, among other things, conservation, environmental and commodity program issues. “We hope Congress comes close to that figure.”

He says a Blue Dog Democrat (the nickname for a strong coalition of moderate Democrats) budget proposal reflected what agriculture needed and “what farm groups wanted. But Congress adopted a different plan.”

He says the budget resolution the Senate passed April 6 provided only $9 billion per year for agriculture. The Blue Dogs and most farm organizations think $12 billion is a more realistic target. “We put out what we thought the industry needed but we lost, at least temporarily,” Stenholm says. “We hope in conference to get close to that $12 billion figure.”

He also expressed disappointment in President Bush's proposal to cut the agricultural budget by 5 percent. “I want to see the figures and examine proposals, but I'm concerned about cuts in agriculture and health,” he says.

The 22-year veteran congressman says he sees a lot of pessimism in the agricultural sector. Unfortunately, that sense of crisis does not extend throughout Congress. “The feeling of potential crisis exists only in about 20 districts across the country where agriculture is a key,” Stenholm says. “Even in my district, some constituents don't understand the plight of the rural economy.”

Stenholm says most farmers have not reached a crisis stage yet because government payments have kept them solvent. “If Congress takes those payments away, we will see a crisis,” he says. “That's why we must continue to explain to our (non-farm) constituents how important these payments are.”

Stenholm says a counter-cyclical supplemental farm income proposal he's supported for more than a year still makes sense for agriculture. Under that proposal, government funds will kick in to offset low commodity prices. As prices decline, payments increase.

“We will see some kind of counter-cyclical program in the next farm bill,” he says. He adds that the system will mesh with international trade regulations.

Stenholm says most farmers prefer to earn their income from the marketplace rather than from government checks. “But, if they want to depend on trade, they have to change the way they market commodities,” he says.

“We can't continue to sell the way we have for 50 years when trade has changed. Cooperative marketing will be crucial and farmers must find a general partner in corporate America to help with marketing and to keep more money in their own pockets.”

He said deteriorating relations with China will affect trade. “China is playing with fire,” he says. “If the Chinese do not behave, trade will suffer.”

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