The near-depression on U.S. farms has produced a frenetic effort in Congress to enact new credits and subsidies and sell more U.S. farm products overseas, even at the risk of starting a trade war.
The House and Senate Agriculture committees have scheduled hearings for this month and March to deal with several dozen proposals, all aimed in one way or another at bolstering sagging U.S. farm exports and recapturing markets lost to competing nations.
Ideas in the works include giving federal crop surpluses, free, to food processors who in turn would sell their cheaper, subsidized goods overseas; below-cost sales and gifts of U.S. surpluses abroad; expanded credit programs to make it easier to buy American.
Farm trade groups, such as those representing poultry, soybean, grain and vegetable producers, are lining up on Capitol Hill to ask for the subsidy help. And many farm-state legislators, talking even tougher on the trade issue than Agriculture Secretary John R. Block and the administration, are in a mood to provide it.
Block, while warning against an agricultural trade war over protectionist policies, has pursued negotiations with U.S. trading partners and held out the threat of retaliatory action if changes don't come soon from Europe, Japan and South America.
But patience in Congress is waning, and there are aggressive calls to make it plain that this country does not intend to be pushed out of the world markets that U.S. farmers increasingly have considered their own.
Senate Agriculture Committee Chairman Jesse Helms (R-N.C.), for example, said last week that "predatory" subsidy policies of the European Economic Community (EEC) have created an "intolerable" situation for U.S. farmers that must be corrected by Congress.
"We must be prepared to draw the line here and fight fire with fire," Helms said. "I hope it won't be necessary, because there are no winners in a brawl, economic or otherwise."
Block pleased legislators and farmers and stunned EEC officials last month with a dramatic first step. His negotiators agreed to give 30 million bushels of U.S.-owned wheat to processors, who in turn would sell 1 million tons of low-cost flour to Egypt. The lower-cost flour will allow the United States to recapture the world's largest flour market from the EEC.
That message to the EEC will cost U.S. taxpayers more than $100 million, but many farm-state lawmakers feel that ought to be just a beginning.
Helms will hold hearings this month on a variety of trade bills, including his own, which would require, among other things, the annual overseas sale of 150,000 tons of surplus U.S. dairy products at prices lower than paid by the Department of Agriculture.
On the House side, the Agriculture subcommittee chaired by Rep. George E. Brown Jr. (D-Calif.) plans hearings in early March on the increasingly controversial farm trade issues. "Trade is going to be the No. 1 issue around here this year, and "the bills are coming in all shapes, forms and sizes," said a Brown aide.
Pending House and Senate measures propose different types of export credit guarantees, more federal spending on market development, giveaways of surpluses as "bonus" incentives to regular purchasers of U.S. farm commodities. And the Helms type of export subsidization, guaranteed to draw cries of foul from foreign competitors, shows up in other legislative proposals. Some examples:
* One, part of a broader measure offered by Sen. Mack Mattingly (R-Ga.), would give surplus federal corn at no cost to poultry producers to raise more (and cheaper) broilers for sale in overseas markets lost to countries that subsidize their producers.
* Another, pushed by Sens. Thad Cochran (R-Miss.) and Walter D. Huddleston (D-Ky.), would give other surplus federal commodities, cost-free, to food processors, including the meat industry, to mix with their own commodities in preparing items for the export trade. The theory is that with lower production costs, processors' overseas prices will be more competitive, sales will climb and jobs will be created here.
* Still another is expected to be offered by Rep. Tony Coelho (D-Calif.) to provide special breaks in international trade to the wine-grape industry, raisin producers and farmers who grow artichokes and other specialty crops, mostly in California.
Other legislators, such as Rep. Cooper Evans (R-Iowa), a farmer himself, are advocating other, non-legislative approaches. Evans recently returned from Nigeria, where he urged officials to consider entering into "countertrade" arrangements that would provide U.S. grain for Nigerian oil.
"I don't like to call it barter," Evans said, "but there is great interest in exploring arrangements along these lines . . . . It requires no legislation, and there are lots of companies in the United States that want to do it."
A large part of the new congressional concern about agricultural trade stems from this country's problem of surpluses, coming from two straight bumper-crop years, and the depressed economic state of American farming, with prices staying low and fears of widespread bankruptcies plaguing farmers.
But another part stems from the relatively recent realization on Capitol Hill that world markets that were dominated for more than a decade by highly productive and efficient U.S. farmers no longer "belonged" to them exclusively.
The EEC, for example, with its system of heavy subsidy to its farmers and restrictive levies on certain food imports, in recent years has become a net exporter of grains, sugar, poultry, beef and other products. The EEC, Canada and Argentina have cut into U.S. wheat sales. Brazil offers new and major competition to U.S. soybean farmers.
In the face of the growing competition and sagging world demand, U.S. farm exports last year declined for the first time in 13 years. Alan T. Tracy, a deputy undersecretary of agriculture for international affairs and commodity programs, is predicting that exports probably will go down again this year by as much as 4 percent, to $37.5 billion.
Part of the decline is attributed to recession and weaker demand; part to the dollar's strength, which makes U.S. goods less attractive in foreign markets, and part to growing competition from nations whose farmers are subsidized more heavily than American counterparts.
"We don't think the American public wants the government to sit by while our farm exports suffer," Block told Congress recently. "Every American has a stake in our farm exports, since those exports create a favorable balance of agricultural trade that compensates for our deficits in industrial trade."
"Every $1 billion of agricultural trade creates an additional $1 billion of U.S. economic activity; that means jobs--35,000 jobs for each additional $1 billion in exports," Block said. "The wheat-flour sale to Egypt will generate $850 million in additional economic activity and create jobs for over 9,000 people."
Added Rep. Evans: "There is great concern among us farm-state legislators, but there's also a real optimism. We're doing the right thing on several counts . . . . But the world is more competitive now, and we've just got to work harder at this."