Hard to Tell What Will Happen with Farm Bill

Administration lays out some outlines to Congressional leadership.

Despite optimism last Friday in Congress that a deal had been reached on the farm bill, Agriculture Secretary Ed Schafer said Tuesday he would be surprised if the President signed the farm bill. The comments were made following a speech on the farm bill and Doha negotiations. Schafer said the Administration remains concerned about the World Trade Organization implications of the new farm policy and expressed concern that a new deal in Congress had cut direct payments, which are WTO compliant, while increasing counter-cyclical payments, which WTO views as trade distorting. Schafer also indicated the administration would support a three-year extension allowing for final farm bill negotiations in 2010, which would alleviate having a new president address the bill in the first year of office.

President Bush blasted the lack of reform in farm bill negotiations during a speech in the Rose Garden. Congress is considering a "massive, bloated farm bill" that would do little to address rising food prices, he said. "America's farm economy is thriving, the value of farmland is skyrocketing, and this is the right time to reform our nation's farm policies by reducing unnecessary subsidies. It's not the time to ask American families who are already paying more in the check-out line to pay more in subsidies for wealthy farmers. Congress can reform our farm programs, and should, by passing a fiscally responsible bill that treats our farmers fairly, and does not impose new burdens on American taxpayers."

Earlier Tuesday, Schafer and Deputy Ag Secretary Chuck Conner met with Congressional farm leaders to air the Administrations concerns behind closed doors in the U.S. Capitol.

"We gave them a list of our concerns, and we had a useful discussion," Conner said as he and Schafer emerged from the meeting. Senate Agriculture Committee Chairman Tom Harkin, D-Iowa, said they had "had an open and frank discussion…but no one's going to get 100% of what they want." Harkin and Senate Budget Committee Chairman Kent Conrad, D-N.D., agreed that discussions centered more on policy reforms than on funding issues.

The meeting of all conferees that had been rescheduled for 2:30 p.m. EDT Tuesday was cancelled as the chairmen and ranking members of the agriculture and finance committees met to work out some of the details of the Farm Bill.

Both Harkin and House Agriculture Committee Chairman Collin Peterson, D-Minn., expressed confidence the conference would complete the final bill this week, leaving final drafting and floor votes to next week. Peterson, who has negotiated with the USDA officials since December, expressed no surprise at the Administration's concerns. Asked if the House had the votes to override a veto, he said it would depend on what came out of the final conference on the farm bill.

According to Mary Kay Thatcher, Director of Public Policy for the American Farm Bureau Federation, judging by the Administration's agreement to offset the $10 billion over-baseline cost with customs user fees, she puts the likelihood of a veto of the Farm Bill over lack of policy reforms at about 30%.

Senator Charles Grassley, R-Iowa, the ranking member of the Senate Finance Committee was encouraged by the President's comments Tuesday and the message brought to Congress by the USDA officials.

"They are going to cause us to reconsider some positions we've had," Grassley says. " But most of what the President has outlined have not been finalized even in this small group of negotiators; and in a larger group those things are subject to change as you can do in an open conference. I think it is a step forward that the President has made the statement that he made."

A meeting of the Farm Bill Conference Committee has not yet been scheduled or announced.

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