The House yesterday passed a four- [WORD ILLEGIBLE] farm bill increasing price supports for wheat and corn and making [WORD ILLEGIBLE] or changes in the food-stamp program, including elimination of the retirement that recipients purchase some of the stamps. The vote was 294 to 114.
The annual average cost of the authorization bill is estimated by the administration to be between $10.5 billion and $11.5 billion, with approximately $5.6 billion of that going for food stamps.
Though the administration originally wanted a farm bill it estimated would cost about $9.6 billion a year, it has decided to accept the House version, which increases price supports for corn and wheat more than the President wanted, but only for the 1977 crop year.
However, the administration is still threatening a veto if the bill goes any closer in conference to the Senate version, which would cost about $1.5 billion a year more primarily because it sets higher price supports for the crop years 1978 and beyond.
Both the House and Senate Budget Committee chairmen have criticized President Carter for not holding his ground and insisting on lower price supports for farmers, contending that the increases allowed will hurt his credibility in demanding reduced spending and a balanced budget by 1981.
However, Senate Agriculture Committee Chairman Herman E. Talmadge (D-Ga.) said large increases are necessary to help farmers stay in business. Talmadge announced that a conference between the House and Senate would begin today in an effort to pass a bill before the congressional recess on Aug. 5 for a month-long vacation.
The House increased price supports for wheat and corn for the current crop year because, despite a drought, there is a world-wide glut of wheat and indications that there will also be a record crop for corn, sending prices farmers receive for those commodities plummeting.
The House increased the 1977 target price for wheat from $2.65 per bushel to the Senate level of $2.99 per bushel. That means the government would make up the difference to farmers between the market price for wheat - currently around $2 per bushel - and the target price of $2.90.
Both the loan and target price for corn were increased to $2 a bushel by the House. Setting the loan, which is a price floor under the commodity, at that level, means the government will take the corn and store it while making "loans" to farmers at the $2 bushel rate.
The 1977 loan rate in both the House and Senate bill had been set at $1.75 a bushel.
The House rejected efforts to decreased subsidies for peanuts. A proposed amendment to phase out subsidies for tobacco was never offered.
The House also reaffirmed yesterday a new price support program for sugar which sets the price at 55 per cent of parity, or, currently about 14 cents a pound. The administration, though conceding that domestic sugar producers should get price supports because of falling world market prices which damped sugar here at 8 cents a pound, or so, when it costs domestic growers $13.5 cents a pound to produce, were nevertheless vehemently against a parity program.
Under a parity program, the best way to keept domestic prices up is to impose a tariff against imported sugar, something the administration, engaged in trade talks in London, did not want to do. Instead they wanted to pay sugar producers the difference between the market price and 13.5 cents a pound.
But the House, after adopting the sugar parity program last Friday, refused yesterday to knock it out by a 246-to-165 vote.
Both bills also establish an 8-million-tons grain reserve disigned to store grain over three years rather than one as a way of controlling extreme fluctuations in prices and supplies.
The bill restructures the food-stamp program to tighten eligibility requirements on the one hand, while eliminating the purchase requirement on the other.
Iligibility requirements would be tightened by lowering income eligibility limits to the poverty line, reducing the number of deductions possible, and tightening the assets test. Student eligibility requirements would also be tightened. Estimates are that the changes will eliminate 1.3 million people from the program and reduce benefits for 4 million others.
At the same time, eliminating the requirement that recipients pay something for the food stamps, depending on their income, is expected to add 2 million people to the food-stamp program.
The bill also provides for so-called "workfare" pilot projects in each state. Under the projects, recipients who can work who do not find private sector jobs in 30 days must accept public service jobs at the minimum-wage rate, paid in food stamps, to earn their food-stamp allotment each month.
An amendment to broaden the workfare project so that each community which wanted one could have one was rejected 255 to 159.