AG BILL MUST BE EXPORT FRIENDLY

Exporting our U.S. agricultural products to the rest of the world is critical for America's farmers and ranchers. Almost 40 percent (some products are higher and some lower in percent exported) of the farm commodities raised in this country are shipped into other countries of the world.

It doesn't take a high-powered economist to understand that the volume of farm-gate products which go to other countries will dramatically affect the prices that our farmers and ranchers receive. U.S. farmers have become so productive since the 1950s that they must have a viable export market for their wheat, cotton, soybeans, corn, milo, rice, beef, pork, poultry products, milk products and other commodities to receive reasonable prices from that world market. The supply of, and demand for, each of those commodities in the world is what determines prices that our farmers and ranchers receive. This is good old Economics 101 supply and demand at work. In fact, agricultural commodities are great examples of basic economics at work when it comes to setting prices for those farm and ranch products.

Before I go further, let readers understand that I personally do not like farm programs and look forward to the day when we do not have any federal subsidies for agricultural producers in this country. The real question is how we go from Point A, which is the current situation of subsidized farm production in the United States as well as most other major producing countries of the world, to Point B which will be when there are no significant subsidies, tariffs or quotas affecting most major agricultural commodity trading.

However, understand that I am not ready to let a large group of farmers fail because of some drastic overnight reductions of federal farm price supports or because of a federal farm program that throws our U.S. producers into unfair competition in the world markets.

The problem is that many of the other major agricultural producing countries of the world, highly subsidize and/or protect their farmers. The General Agreement on Tariffs and Trade, which is in effect, will not really make a dent, in the short term, in the reduction of high subsidies or tariff walls in most foreign countries, especially in the European Common Market and Japan. This forces our farmers and ranchers to compete in a world market with foreign producers on an unlevel playing field. Hopefully in 10 years this playing field will become reasonably level.

Both of the proposed major changes for the 1995 farm bill will reduce the dollars spent on federal farm programs by U.S. taxpayers in relatively equal and significant amounts.

The flexible program (Agriculture Competitiveness Act) supported by Bill Emerson and Larry Combest in the House and Thad Cochran and David Pryor in the Senate would maintain strong expert competitiveness for our major commodities. This flex bill would also save U.S. taxpayers significant dollars in the years that farmers get higher prices in the marketplace. As proposed by Emerson and Combest the flex bill would also have a cap on dollars spent on support prices each year, something we have never had before.

The Freedom to Farm Act supported by House Agriculture Committee Chairman Pat Roberts does not address the unfair competition by foreign producers and will leave U.S. producers of many of our major commodities on the lower end of that unlevel playing field. The FTFA would give farmers the contracted dollars (in gradually reduced amounts) every year regardless of the level of market prices for the various commodities. Will this be very popular with taxpayers?

Maybe a combination or these two bills cans be worked out before the Dec. 31 deadline. Hopefully reasonable congressional heads will prevail, and we will have farm legislation that will (1) reduce government spending on agriculture, (2) begin to phase out U.S. federal farm programs as other countries really reduce their subsidies to realistic market competitive levels and (3) allow our family farms (large and small) to remain as viable economic units.

Peter C. Myers Sr. of Sikeston is a former deputy secretary of agriculture and is currently president of Adopt A Farm Family of America Inc., which is a Christian outreach to farm and ranch families in the United States.