What farmers expect from Reagan: more profitability, less regulation

Some farm policy promises planted during the presidential campaign may never be harvested. Yet there may remain enough of a crop to keep farmers satisfied, if not happy.

One key promise was to end the embargo on grain sales to the Soviet Union. But after three days of talks with top Soviet leaders in Moscow recently, Charles H. Percy (R) of Illinois, who is the likely next chairman of the Senate Foreign Relations Committee, has decided to support continuation of the embargo.

Claiming that "the grain embargo has had a severe effect on the Soviet Union, " Senator Percy said in Moscow that President-elect Ronald Reagan is "reassessing his position on the embargo right now." The farm-state senator added that the grain embargo is "a useful bargaining chip" and questioned whether the United States should enter into a new grain-sale agreement when the current one ends next September.

A Reagan reversal of his pledge to end the embargo would be a blow to farmers -- but one almost certainly mitigated by progress in other areas.

Farmers expect the new administration to stick to the Republican Party 1980 platform pledges to, among other things:

* "Reduce excessive federal regulation that is draining the profitablitiy from farming, ranching, and commercial fishing. . . ."

* "Increase net farm income by supporting and refining programs to bring profitable farm prices with the goal of surpassing parity levels in a market-oriented agricultural economy."

According to some experts, however, "surpassing parity levels" (raising prices for farm products above their 1910-1914 relative values), would hike supermarket prices by 15 percent in addition to any increases caused by normal inflation. So it is clear that some tough decisions confront the new Reagan administration.

Robert Book, an Indiana farmer and agribusiness executive who could become the next US secretary of agriculture, says the decisisons can best be made by "recognizing the necessity of operating in a laissez-faire free market economy."

Those in the agricultural community who back Mr. Book for secretary think he is just the man to run the US department of Agriculture (USDA) because he is the only contender for the job who has never served in government before.

"How can you get government off our backs," asks Kansas City agribusiness leader Ernest Marshall, "if you don't begin at cabinet level with someone who knows government from outside -- not inside -- and with someone who has been the victim himself of government overregulation?"

Whoever is chosen as next secretary of agriculture will have to start making tough decisions soon. One of the first tasks of the Reagan administration is to draft the 1981 farm bill to replace the 1977 farm bill.

Missouri farmer Tom Mershon, for one, would be happy with a new farm bill dedicated to "less government control and less government involvement."

Kansas farmer Tom Toll says he hopes the switch to Reagan "means government noninterference, with no more embargoes. . . . And if it was up to me, they would close the USDA down and the government would get right out of agriculture."

Nebraska rancher Wayne Jenkins would like the same government withdrawal -- but, like many established farmers, he sees little likehood of this happening. Farmers, he says, have come to depend on government intervention to a point that "the farm programs have become a way of life."

Since farm price-support programs were launched in 1932, there have been repeated attempts to dismantle them, with no success. This despite the fact that the agricultural community now has dwindled to just 3 percent of the population, thereby reducing farmers' political clout. Farmers also are separated from other major economic groups by their interest in receiving higher prices for their products while paying low wages to their help.

Even though both Carter and his secretary of agriculture, Bob Bergland, are farmers themselves, they lost crucial farm support because they were forced to represent broader interests.

Mr. Carter won farm support in 1976 by promising never to impose the embargoes in food exports, which past presidents Richard Nixon and Gerald Ford both used to hold down prices for domestic consumers. Yet Carter did impose a grain embarge in 1980, not to placate consumers but in response to Soviet aggression in Afghanistan.

Reagan may decide to retain the grain embargo for economic and foreign policy reasons that outweigh the farmers' opposition. But the farmers may forgive this switch if, overall, the new administration is seen reducing the role of the USDA , which many of them consider too burdensome.

Aside from the presidential election, farming interests are pleased by what they see as a bountiful harvest in the new Congress.

With the weeding out of liberals (particularly in the Senate) who "don't believe in the free market system," insists Eugene Malone, spokesman for the American Farm Bureau Federation, farming will become profitable again. Less regulation will be needed, he says, because farmers making profits will once again be able to afford to protect their land from being ruined by erosion or bought out by speculators.