Tight money, open debate may trim U.S. farm aid

WASHINGTON Wed Mar 16, 2011 3:35pm EDT

WASHINGTON (Reuters) - Congress may push idle cropland back into production or get rid of a $5 billion-a-year subsidy to grain, cotton and soybean farmers when it overhauls U.S. farm law, a House committee chairman said on Wednesday.

Lawmakers will have billions of dollars less to spend on the so-called farm bill than in 2008, Agriculture Committee Chairman Frank Lucas said. "There will be some stuff that falls off the table" as priorities are set for funding.

Interviewed at the Reuters Global Food and Agriculture Summit, Lucas used the 32 million-acre Conservation Reserve, which idles fragile cropland, and the $5 billion-a-year "direct payment" as examples of items that could be hit by fiscal austerity or become a target in wide-open House debate.

In the end, "there may not be as many acres in the next farm bill," said Lucas, referring to the Conservation Reserve.

"The direct payment, for instance, even though it's (World Trade Organization) compliant, the body may decide they don't want it."

Lucas said, "I'm not giving anything up until I get into that big farm bill process next year." The committee is likely to begin information-gathering hearings this fall and open the bill-drafting process in May 2012 or thereabouts.

Written every five years or so, farm bills are broad-spectrum legislation that covers crop subsidy, farm export, public nutrition, land stewardship, biofuel and agricultural research programs. The 2008 law was estimated to cost $289 billion, two-thirds of it for nutrition programs.

Reformers say the direct payment is a waste because it is paid regardless of need. It is popular in farm country as a hedge against bad weather or high production costs.

One-third of land in the Conservation Reserve could be farmed with little fear of damage and another third would require steps to control erosion, experts say.

Also during the interview, Lucas said, "I am not a proponent of going to E15," meaning an increase to 15 percent of the blend of fuel ethanol into gasoline.

He said "I don't expect to" create a new farm support system in 2012, "but in good faith, I can't rule that out." Congress deregulated farming in 1996 while trying, as in this year, to control federal spending.

(Reporting by Charles Abbott, editing by Matthew Lewis)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.