Bush's farm bill outlines bold move

The Bush administration's recent proposals for the next farm bill – due for reauthorization this fall – have been winning accolades and criticisms from some surprising quarters.

Environmentalists have lauded it as an important step in the right direction, even as the largely Republican agricultural community has met many of its proposals – such as a plan to scrap subsidies for any farmer with an adjusted gross income of more than $200,000 a year – with skepticism.

Conservation and energy programs get a boost in the administration's plan, while several billion dollars are cut from payments to some of the nation's largest farmers. In comparison with the 2002 farm bill, the overall bill would spend $10 billion less over the next five years, according to the Department of Agriculture.

"We have some major concerns," says Mary Kay Thatcher, director of public policy for the American Farm Bureau Federation, which bills itself as "the voice of agriculture." "We're supportive of [conservation, energy, and rural development] getting additional funding, but we don't think you ought to reduce farmers' safety net to do that."

One of the most significant elements of the proposed bill would change the countercyclical program – the means by which the federal government helps farmers in an off year. It would go from one that's price-based to one that's revenue-based. That responds to complaints some farmers have had for years that they can face, say, a disastrous drought – which lowers supply of a crop enough that prices go up – and receive no payments.

This way, says Ken McCauley, president of the National Corn Growers Association, "you're actually getting the money to the farmer who needs the support." Moreover, he notes that corn growers – who have seen prices roughly double in the past year – may be heading into an era of higher prices because of ethanol, but they will still shoulder significant risk. "We'll still need a safety net, and a revenue-based one is a good way to go into it," he says.

The American Farm Bureau Federation is skeptical of that shift, noting that what helps a corn farmer in Iowa might not be so good for a corn farmer in a place like Texas. Ultimately, says Ms. Thatcher, she worries this new method would reduce the overall safety net for farmers.

But her major concerns have to do with the new income limits and payment caps, which would limit payments to a single farmer to $360,000. They would also eliminate some of the ways the farmer could get around such limits before, by setting up different "entities" through which he or she was paid.

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