Help disadvantaged farmers
THE United States Senate will shortly have the opportunity to face the plight of the nation's disadvantaged farmers, an issue that continues to receive widespread public attention during this prolonged slump in farm prices. Farm policy, in fact, is one of the nation's oldest and most esteemed social welfare programs. However, that changed during the last four years, a period when American farmers received $50 billion, with the bulk of the payments going to about 400,000 commercial operations.
Ironically, payments for farm programs skyrocketed just as the budgets for urban-oriented welfare programs were being cut by the administration's austerity efforts. The huge expenditures of the last four years did not result in increased scrutiny and cost-cutting innovations for farm programs by Congress.
Farm programs have become some of the most generous federal programs in existence. Participants in these programs received an average of $25,000 a year over the last four years -- small in terms of a return on investment but excessive in comparison with any other welfare-oriented measures.
The problem with federal farm policy is that it does not target the special needs of disadvantaged farmers.
The New Deal drafters of the first farm programs surely did not envision the kind of results that are with us today. In fact, most of the original farm program advocates saw farm policy as a means to stabilize economic conditions in rural America during the depression -- a period with a far larger and more varied farm population than that which exists today.
Farms during the Great Depression were three times as numerous, much smaller, with little debt, and all roughly equal in terms of production. Also, the consequences of actions taken to stabilize the farm economy by the federal government were less likely to have consequences for affiliated industries.
Federal intervention was thought necessary to stabilize all farms, restore purchasing power, and arrest farming practices detrimental to the environment. Advocates saw their efforts as temporary, to be replaced by a free market at the earliest possible time.
Those programs, with us for half a century, have remained basically the same since the depression. Farm bills have become a part of the national scene, and the secretary of agriculture has taken a firm seat in the President's Cabinet despite representing only 1 percent of the population. Meanwhile, virtually every aspect of farm life has changed. Today's farmer is likely to be a college graduate, well read in finance, with a deep understanding of the latest agricultural technologies. Many producers are
as comfortable in the corporate board room as they are riding their tractor.
Several economists believe that federal farm programs helped contribute to the demise of small farming operations, an assessment with considerable validity. Because the federal government has been willing to underwrite the risk associated with modern farming, many farmers have simply expanded the size of their farms, often at the expense of their neighbors. Today, our nation is left with different types of farms, one-fourth of which are threatened with bankruptcy in the near term while others flourish.
Unfortunately, the House of Representatives did not confront the important issue of directing farm aid to those who need it most. There are two types of farm groups most troubled at present. One involves small farms owned by men and women over 50 years old. These producers often lack education and therefore do not have many suitable employment alternatives. These agrarian entrepreneurs have been bypassed by modern farming.
The other group most affected are younger, well-educated farmers who borrowed heavily when economists and others were predicting prolonged food shortages and global famine. These individual operators are often some of the most productive in their growing regions.
Rather than focus on the needs of the disadvantaged farmers, Congress has acted blindly, continuing to provide aid without respect to need. The Senate will have a chance to undo this approach as it takes up the farm bill this weel.
The Senate should debate the merits of directing federal farm assistance. It should closely examine the type of innovative programs that have been designed in Illinois to help farmers restructure loans. It should fully debate the ``fairness'' of the two dozen million-dollar-plus payments that went to large farmers in 1983 when acreage reductions in farm programs that year cost 250,000 people their jobs in industries affiliated with agriculture. Indeed, the Senate should pause to evaluate the type of mes sage that is communicated to the urban poor of this nation by such an undiscriminatiang program. Through a creative dialogue, especially with governors of hard-hit farm states, Congress can begin to weigh the need of formulating a contemporary farm policy, one that is addressed to the needs of the nation's disadvantaged farmers.
Joseph A. Kinney, former staff director of the Committee on Agriculture of the National Governors' Association, is a consultant in Chicago.
