Farm organizations are saying it may be now or never if they are to succeed in getting Congress to increase the budget authority for farm program spending beginning in 2002.
In the 1996 farm bill, Congress allocated a set amount of money for farm programs over seven years. That budget authority or the baseline is scheduled to fall to $4.1 billion in 2002, the last year of the bill. Although Congress thought the amounts sufficient for what many expected to be the last farm bill, they have been far short of what was needed. In the last three years, Congress provided direct emergency assistance totaling $25 billion to producers.
Last year, Congress spent about $22 billion on farmers, including budgeted and supplemental Agricultural Market Transition Act payments, marketing loan or loan deficiency payments and emergency assistance to try to help preserve the farm sector.
Congress could pass legislation authorizing such sums because of the budget surplus in the final years of the Clinton administration. With the economy showing signs of slowing, energy prices skyrocketing and President Bush promising sizable tax cuts, some analysts are questioning how long the surplus will remain.
"The Congressional Budget Office is scheduled to issue its projections for the federal budget on March 1," said John Maguire, vice president of Washington Operations for the National Cotton Council. "Because of the uncertainty surrounding the economy, some think the budget surplus will be as good as it gets for some time."
Few people, including most farmers, want the federal government to have to spend another $22 billion in emergency assistance or budgeted farm program payments in the next year.
Producers would much prefer to see higher prices and better weather conditions help them make a profit from the marketplace rather than have government payments account for half their income as it did in calendar year 2000.
In recent weeks, the Cotton Council and other groups have been developing farm program recommendations in advance of new House Agriculture Committee hearings in February. Rep. Larry Combest, the committee chairman, has laid down specific rules for what he wants to hear from witnesses.
"So far, the sentiment among farm organizations seems to fall along these lines - those who think Freedom to Farm is lousy policy and there's not enough money and those who think Freedom to Farm is good policy and there's not enough money," said Maguire.
"Chairman Combest has asked the organizations to tell him specifically what they want in the way of policy, but some think he will also use the hearings to let the House Budget Committee hear about the concerns about the lack of budget authority."
No one is asking the Congress to consider approving budget authority of $20 billion or more. Most analysts have been talking more in terms of $7 billion, $8 billion or $9 billion as what might constitute adequate funding for a "meaningful farm program."
Hopefully, Congress will develop a new farm bill that will help restore profitability, and such amounts will be extreme. Given the cyclical nature of agriculture, however, who's to say such authority or more won't be needed again at some point in the future.