Former Senators Propose Eliminating Direct Payments to Farmers

Tom Daschle and Bob Dole say U.S. ag policy should be more market-based.

Published on: May 31, 2007

Former Senate leaders Tom Daschle and Bob Dole suggested Wednesday that the nation's agricultural policy should be reformed, saying farmers should become more dependent on the marketplace.

Daschle, a Democrat from South Dakota, and Dole, a Republican from Kansas, proposed eliminating direct payments to farmers but retaining countercyclical payments, which pay farmers only when prices are low. They also suggested that farmers be encouraged to take part in emerging markets such as renewable fuels to help them stay afloat.

The former senators say their proposals could mean a net savings of $4.68 billion to the U.S. Treasury.

"If we're going to have a farm bill this year, we have to demonstrate that the farm bill can be written at a reduced cost to taxpayers," says Daschle, the Senate's top Democrat when Republican John Thune defeated him in 2004.

Daschle was a member of the Senate Agriculture Committee and played a major role in writing the last six-year farm bill, passed in 2002. Congress is beginning work on that law's renewal this year.

Dole also was on the committee before he left the Senate in 1996. Lawmakers need to broaden their perspectives when crafting farm policy, he says.

"Enabling farmers to access new markets will increase farm incomes while lowering our existing commodity subsidies," Dole says.

The former senators also backed a mandatory cap and trade program designed to reduce greenhouse gases. Such a system would set limits on greenhouse gas emissions but would let companies not meeting the cap buy credits from those in compliance.

Cutting down on carbon dioxide emissions, they say, would make way for the expansion of biofuels. That policy also would encourage increased use of wind and solar power, which could be developed on farm and ranch lands.

Other aspects of the proposal:

- Farm benefits would be capped at $250,000 a year for an individual. They are now capped at $360,000, but loopholes allow some people to collect millions of dollars above the limit;

- A "robust marketing loan program" that treats all farmers equally;

- Expansion of law that would require the use of renewable fuels, improve distribution of those fuels and require more flexible fuel vehicles;

- Expansion of existing conservation programs, including the Conservation Reserve Program, which pays farmers to idle their land.

Senate Agriculture Committee Chairman Tom Harkin, D-Iowa, praised parts of the report.

"The report gives us solid ideas for re-examining our farm commodity programs - particularly the direct payments - so we can better use our budget for countercyclical income protection and critical investments in the future for farmers and rural communities," Harkin said in a statement.

House Agriculture Committee Chairman Collin Peterson, D-Minn., did not have an immediate comment.

The report was published by the Bipartisan Policy Center, a new group aimed at finding policy answers to the nation's biggest issues. The group is directed by four former Senate majority leaders: Daschle; Dole; former Sen. Howard Baker, R-Tenn.; and former Sen. George Mitchell, D-Maine.

Source: Associated Press