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New farm bill an improvement

By John Stencel

As of May 8, both houses of Congress have passed the farm bill, and President George Bush is expected to sign it.

Applicable to the 2002 crop year, the legislation—while still lacking in some areas—is a considerable improvement to the previous “freedom to farm” bill that has bankrupted family producers and cost taxpayers billions of dollars in disaster assistance.

First, the new bill, for the first time in two decades, raises commodity loan rates. This will give producers more flexibility in marketing their commodities, ultimately enabling them to receive more of their income from the marketplace and less from government payments.

Another plus in the new bill is mandatory country-of-origin labeling for meats, fruits, vegetables, fish and peanuts. This is a measure overwhelming favored by consumers and producers alike. The bill also specifies that products labeled as “American made” be from plants and animals born, raised and processed in the United States.

Dubbed the Pippen provision after NBA star Scottie Pippen, the new bill prohibits farm benefits from being made to extremely high-income individuals and companies. The bill also increases spending on conservation and rural development spending. Another positive is that this farm bill, for the first time, has an energy title, which gives incentives for companies, cooperatives and individuals who elect to invest in renewable energy sources. Given instability in the Middle East, depressed grain prices, and concerns over pollution and the environment, it makes sense to more aggressively encourage the development of these environmentally-friendly alternative energy sources.

On the downside, the new farm bill failed to ban prohibition of packer ownership of animals within 14 days of slaughter, an anti-competitive measure that continues to weaken producer market prices for live animals.

In addition, the new farm bill has and will continue to be criticized for its high price tag. Election year pressures prevented members of Congress from aggressively placing caps on payments to farmers. The caps, while still higher than supported by Farmers Union, are lower than the levels originally proposed in the House version of the farm bill. Farmers Union will continue to push for limits necessary for a family operation. These benefits would be paid to large and small producers alike. Lower caps will save federal dollars, create a better public image for farm programs, and discourage overproduction of commodities.