Care needed in writing farm bill

The heady boom of oil production in western North Dakota has overshadowed what also has been a very good time for agriculture.

Net farm income nationwide is expected to be more than 30 percent higher than in 2009, and 26 percent higher than the 10-year average that began in 2000. North Dakota’s farm economy has been solid, although complicated by recent wet springs that have made getting crops in more difficult.

When agriculture rides the upside of its economic cycle, as it does today, farm subsidy programs seem unnecessary and, to some, unjustified. That’s doubly the case each time Congress debates a new farm bill.

Congress will take on a new farm bill in 2011. Inevitably, there will be an effort by some lawmakers to reduce or eliminate farm subsidies. They will be given added motivation to cut as Congress attempts to bring down national deficit and debt. The president’s commission for fiscal responsibility and debt reduction included reductions in farm subsidies.

Farm programs today can trace their origins to the drought and Depression of the 1930s. They reflect the impact of the erratic nature of weather and markets on farm income. U.S. farm programs support food security and independence for the nation, just as we would like to be energy independent as a nation.

Also, the initial purpose of the nation’s farm programs was to support family farms.

Because there are abuses and extremes in farm programs, in which very large industrial farms receive very large subsidies, farm programs can be seen as corporate welfare. And because not all crops receive subsidies, there are questions of influence and equity. But for family farms in dry years, or when prices collapse, they are essential.

The checks that farmers get for their harvest go back into the local economy in the form of equipment purchases and buying seed, fertilizer and fuel. When those costs go up, farmers cannot automatically pass on the increases.

Historically, there have been inflationary jumps in the price of fuel and fertilizer that have left farmers without any profit in their margins.

No doubt farm programs will be hotly debated in the next 12 months, and changes will be made. North Dakota farmers are not looking for a free ride.

But experience has taught them that Mother Nature and commodity markets can be unforgiving and a little “insurance” can make the business of agriculture more secure. This is in the nation’s best interest.

Tags: farm bill, opinion, editorials