This year, farmers have been devastated by droughts in the Northeast and Great Plains, by floods in the mid-Atlantic, by depressed prices all over America. But on Capitol Hill last night, farmers -- especially large farmers -- enjoyed their most bountiful harvest in years.
Just three years after the Republican-controlled Congress passed landmark legislation to wean farmers off the federal dole, it easily cleared the way to complete an unprecedented $8.7 billion emergency farm bailout, part of a $69.3 billion farm spending bill. The bill was hailed as a desperately needed lifeboat for drowning small farmers, but it also included language doubling the limits on government handouts for individual farmers to a hefty $460,000. And in recent days, southern senators tacked on a provision to gut even those limits for large cotton farmers.
The debate over the $8.7 billion rescue package -- which somehow emerged as a compromise between a Senate version with only $7.4 billion in emergency aid and a House version that had none -- provided a sharp contrast to the fiery, market-oriented rhetoric that ushered in the GOP "Freedom to Farm" legislation of 1996. Some Democrats and eastern Republicans argued that the package did not go far enough, but with farm prices plummeting to the lowest levels since the Depression, no one suggested that farmers should fend for themselves in the free market.
Instead, after a brief squabble over dairy issues and drought relief, the Senate voted 79 to 20 to cut off debate, clearing the major obstacle facing the bill. The measure is expected to be approved today and sent to President Clinton for his signature.
"This is a very generous response to the needs of farmers," said Sen. Thad Cochran (R-Miss.), chairman of the Agriculture Committee and author of the cotton provision. "We're making it clear the government is not going to turn its back on them when times are tough."
The emergency package also includes $328 million for tobacco farmers, $325 million for dairy farmers and an extra $200 million for Cochran's beloved cotton farmers. Including this year's bailout, which broke the record set by last year's bailout, Congress has now spent $19 billion more in the first four years of Freedom to Farm than it was supposed to spend during the bill's entire seven-year lifespan.
Freedom to Farm's critics say that Congress is essentially reaping what it sowed when it tried to ease the government out of the business of guaranteeing commodity prices. Everyone seemed happy with the situation in 1996 and 1997, when farmers were benefiting from high prices in the private market while enjoying hefty government payments designed to ease their transition from risk-free farming. But as prices in almost every commodity have crashed in the last two years, Congress has returned to big handouts to ease the crisis.
Farm voters and lobbyists, after all, are not to be trifled with in Washington; agricultural interests contributed $43 million to federal candidates in the 1998 election cycle, including $8.6 million from crop producers. In fact, the farm lobby had pushed for an $11 billion bailout and enlisted the support of most Democrats. While GOP leaders are counting their somewhat smaller package as "emergency aid" that will not count toward their strict budget caps, some senators warn that the bill for their renewed generosity will eventually come due.
"The way we're going, we're just going to have to do these disaster packages over and over and over," said Sen. Bob Kerrey (D-Neb.). "They're just tremendously expensive. At some point, these disaster bills are going to become a disaster themselves."
Small farms have been disappearing from the national landscape in recent years -- there are now fewer farms in this country than at any time since the Civil War -- so members of Congress have been pushing farm relief as a last-ditch effort to preserve a dying way of life. But some rural advocates complain that Congress is catering to megafarms at the expense of the little guy, and they see the new provisions easing the limits on government payments as proof.
Initially, Cochran introduced a measure to double the maximum handouts for two programs: the transition payments under Freedom to Farm, which are currently limited to $80,000 per farmer, and so-called "loan deficiency payments" that ensure farmers a minimum price for certain crops even if the market price is lower, right now up to a maximum of $150,000. Chuck Hassebrook, project director for the Nebraska-based Center for Rural Affairs, warns that large farmers will surely use their windfalls to buy out smaller operations.
"This is a real outrage," Hassebrook said. "It's being passed under the guise of helping struggling family farmers, but it's going to end up giving huge subsidies to the nation's richest landlords so they can squeeze struggling family farms out of business."
During the House-Senate conference to prepare the package, Cochran provided an additional soft touch for his friends in the cotton industry, creating new uncapped "certificates" that farmers can accept instead of the regular cash payments. The certificates could be traded for cotton or money. Kerrey and other farm belt senators were furious, but it is no coincidence that Cochran, Senate Majority Leader Trent Lott (R-Miss.), House Majority Leader Richard K. Armey (R-Tex.), House Majority Whip Tom DeLay (R-Tex.) and House Agriculture Committee Chairman Larry Combest (R-Tex.) all hail from cotton states.
It is not clear how much the certificates will cost taxpayers, but the cost of deficiency payments is already soaring. In 1997, when prices were high, the government spent only $165 million on them. That figure skyrocketed to $3.7 billion last year and is projected to reach $5.4 billion this year. And if the limits are removed, some large farms may receive multimillion-dollar payouts.
"If you want to farm an entire country, good luck, but I don't see why the government should underwrite you," said Robert Carlson, a grain farmer who is president of the North Dakota Farmers Union. "This country needs to decide whether we want to maintain family farms or whether we're just going to let the big operations take over. We're dying out here."
GOP aides argue that the certificates are not really a big deal, because farmers can already take advantage of a Freedom to Farm loophole that would allow them to receive unlimited payments if they forfeit their crops to the government. But some Republicans are beginning to acknowledge a newfound discomfort with the market-driven theories behind Freedom to Farm.
"Everybody loves the market when the market is good," said one GOP aide. "But when prices go into the toilet, suddenly everyone wants the government back in the game."