The House yesterday voted to give wheat farmers an extra $470 million in federal subsidies this year after it became apparent the administration had given up its fight to hold the payments at present levels.
House Agriculture Committee Chairman Tom Foley (D-Wash) had stood aside from efforts to both Republicans and Democrats on his committee to increase the price supports, but he wound up proposing the increases himself on the House floor. He warned that the changes, which would apply to the 1977 crop year only, were "as far as we can go" and obtain administration support for any farm bill.
After the vote. Agriculature Secretary Bob Bergland said he would recommend the President sign the bill "as it is now constituted. But if it gets torn up in confernce that's another matter."
The concession represents the third time the administration has backed off on veto threats and grudgingly accepted higher farm price support levels.
Original recommendation it made in March were raised a few weeks later.Last week it agreed to go along with still higher supports in the House bill, and yesterday accepted a further increase.
House Democrats argued that the levels accepted yesterday will enable the administration to hold the line in a House Senate conference against the Senate version of the bill. It has even higher support levels than the House legislation.
But it appears that the administration concession was made mostly because a coalition of farm state Democrats and Republicans had the votes to pass the higher levels on the floor.
Rep. Charles Thone (R-Neb.), "When it comes to farm programs, President Jimmy Carter says, 'Talke loudly and carry a small carrot.'"
Farm state congressmen pushed for the higher prices because, despite a hard winter and drought, a near record wheat crop of over two billin bushels is about to be harvested, causing a drop in wheat prices. A glut in wheat exists throughout the world and foreign markets are not available as they have been in recent years.
Though drought could still affect corn, there are predictions that a near record corn harvest is also possible.
Rep. Glenn English (D-Okla.) said the cash prices for wheat have hovered around the $2 level for the past month or so and have dropped as low as $1.80 a bushel. "Even the most conservative economists do not suggest that these prices are anywhere near sufficient to cover the farmer's cost of production," he said.
The $2.90 a bushed support price for wheat adopted by the House yesterday matches the level already approved by the Senate.
The House committee had approved a $2.65 a bushel level and Carter originally favored $2.47 a bushed. The loan rate for wheat stays at $2.25 a bushel in all versions. Foley said the increase would cost an additional $470 million.
The support price for corn was raised from the House committee's $1.85 a bushel to $2 a bushel and loan rate would increase from $1.75 in the committee bill to $2 a bushel. Carter had wanted a $1.70 support price for corn.
Equalizing the loan rate and support price means farmers will probably store much of their corn crop until next year, using it as collateral on a loan.
For wheat, the government must make up the difference between the support price and the market level.
English argued that an Agriculture Department survey found that 72,000 grain producers in the Southwest and Midwest are in financial difficulty and 24,000 farmers would go bankrupt without the increase price support levels.
The House also refused to limite payments to sugar producers to $50,000 a producer. No vehicle for payments to sugar producers now exists, but the administration had announced a plan to pay processers and have the payment passed on to producers, a method the General Accounting Officer said was illegal.
The administration had announced it would allow only a 2 cents a pound subsidy for the producers suffering from plummeting prices.
But yesterday Rep. William Wampler (R-Va.) said administration officials had agreed to pay whatever subsidy was necessary to keep sugar at 13.5 cents a pound.