Farm program barely under way, yet pressure builds for changes
The nation's new farm program is running into trouble just months after it kicked into operation. Criticism is mounting that the program's underlying assumptions are wrong. Agriculture's current decline is permanent, not cyclical, many experts say. Even at the United States Department of Agriculture's outlook conference, which began Tuesday, government officials were not optimistic that the current pressures would go away soon.
``We are in the midst of a far-reaching restructuring of the sector,'' said Robert Thompson, USDA's chief economist. At the heart of the problem is the 40-percent drop in the value of US exports in the 1980s.
When it passed its five-year farm program a year ago, Congress assumed export earnings would bounce back fairly quickly. Legislators lowered prices to make American crops more competitive but shoved in record amounts of money - $25 billion - to maintain farmers' income. Now there's an emerging sense that those exports won't come back, at least not until the end of the decade.
``There's nothing to suggest more than a modest improvement in [agricultural] export volume,'' said Richard Goldberg of USDA. For 1987, he added, the value of US exports is expected to remain at this year's low level of $26 billion.
The current program is a type of industrial welfare, in which government money flows to almost all crop farmers. Not surprisingly, the biggest subsidies have flowed to the largest producers and not to the midsized family-run farms, causing a storm of protest.
``This is not saving the family farm,'' wrote James P. Gannon, Des Moines Register editor, in a recent column. ``This is using the family farmer as a decoy in a stickup.''
Many agriculture observers expect that Congress will have to modify its current program and find some way to begin the difficult downsizing the industry now faces. At least three broad approaches are now under discussion:
Mandatory supply controls. This option has gained increasing support as United States grain surpluses have overflowed. The most radical measure is the Harkin-Gephardt bill proposed in the last Congress that would give farmers much more generous price supports, but strictly control the amount each farmer could sell domestically.
Targeted subsidies. Essentially, this option would continue the current trend of lower farm price and income supports, but it would replace the current industrial welfare approach with a more selective end targeted subsidy program. Several plans would direct help to midsized farmers and take more farmland out of production permanently.
Rural revitalization. This is a plan that would quit trying to maintain the Midwest's troubled rural economy with farm programs and would move to revitalize other industries in the heartland. This would provide farm families with employment other than farming.