House moves ahead with bill despite cost fears

Friday, September 7, 2001

WASHINGTON -- The House will start overhauling federal farm and food programs despite concerns that the shrinking budget surplus means little money for the legislation, GOP leaders decided Thursday.

Debate on the measure could start as early as next week.

"We don't see anything that would stop us," House Majority Leader Dick Armey, R-Texas, said after a strategy session with the chairmen of the House agriculture and budget committees.

"We've obviously got to do a little bit of work," he added, referring to the budget problem.

The farm bill would cost nearly $170 billion over the next 10 years, including $74 billion of the surplus that was expected in the congressional budget agreement reached in the spring. Much of the money would go toward extending subsidies for grain and cotton farmers through the next decade.

Under new budget forecasts issued last month, nearly all that remains of the projected surpluses over the next few years is the portion expected to come from Social Security taxes.

The smaller surplus likely forces agricultural programs to compete with other spending priorities of Congress and the White House, including education and defense.

"It has an impact," said House Agriculture Chairman Larry Combest, R-Texas. "We can't say we're going forward without considering it."

The House bill would replace farm and nutrition programs that expire next year.

The chairman of the Senate Agriculture Committee, Sen. Tom Harkin, D-Iowa, said he hoped to have his chamber's version of a farm bill completed by the end of the year.

However, he said, "All that money has evaporated. Exactly how we're going to deal with that, nobody knows," Harkin said.

The House bill would retain existing price supports for corn, wheat, rice, soybeans and cotton and create a new "countercyclical" program to provide additional payments when prices drop below certain levels.

The new program is designed to replace the emergency payments Congress has voted each of the last four years to supplement the subsidies farmers receive under the 1996 farm law, which expires in 2002.

Mexico's agriculture minister, Javier Usabiaga, expressed concern about the bill in a speech Thursday in Washington to U.S. produce growers.

An increase in American farm assistance would make it harder for U.S. negotiators "to take the lead in calling for the reduction" in farm subsidies worldwide, Usabiaga said.

The bill is H.R. 2646.

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