E2-LMcastor Faming, Saturday, May 2,1987
Passage of the 1985 Farm Bill was
both tedious and painful. Never has
agriculture disagreed so strongly on
what should be done to bolster the
dangerously low farm economy.
Government controls, free
markets, production reduction,
marketing quotas, set-asides and sub
sidies were vigorously debated for
months before a compromise was at
last reached.
Unfortunately, some provisions of
the final farm bill may never have the
opportunity to be implemented.
Already opponents of the ’B5 Farm
Bill have introduced proposals which
would rewrite many sections.
One such proposal, the Harkin-
Gebhardt “Family Farm Act of
1987”, translates into government
take-over of the most important func
tion of a farmer that is making his
own production and marketing
decisions.
An attempt to place the future of
agriculture with government plann
ing rather than with the market
system will place farmers at the mer
cy of politics more than ever before
by controlling it through annual ap
propriations by Congress.
The Harkin-Gebhardt Bill would
provide for producer referendums by
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(JAMES E. NOLL GRAIN
1985 Farm Bill: Give It A Chance
commodities, except for wheat and
feed grains which would be combin
ed in one referenda. The impact on
foreign markets would result in our
being locked into current export
quantities at a time when U.S. exports
are already at historic lows, and
would tell our competitors we will not
tty to recapture our overseas markets.
For the past several years our
farmers have been competing against
the treasuries of other nations which
have generously subsidized their
agriculture. The current Farm Bill
has gone far in placing heavy finan
cial burdens on foreign countries
which do subsidize their agriculture.
Subsidized agriculture has been a
disaster, not only in this country, but
in Europe as well.
The Harkin-Gebhardt Bill limits the
maximum acreage set-asides to 35
percent. More realistic estimates
point to as much as 50 or 60 percent
if the projected prices are to be attain
ed. A national marketing quota for
each commodity would be establish
ed based on projected domestic
demand, export demand, food-aid re
quirements, carryovers and reserves.
From those projections, a national
acreage allotment on acres farmed
would be establish
The Farmers 9 View
Farmers would have to apply for
their allotment by submitting
planting intentions for each commodi
ty. A targeting mechanism will be
established for each commodity
which will distribute the set-aside for
each farm. The unpaid set-aside
would be set at 35 percent of the
acreage base on any farm. Included
is a provision for the Secretary to of
fer a paid diversion plan above the 35
percent.
Marketing certificates will restrict
a producer’s ability and right to
market his product. Products raised
without a marketing certificate can
not be sold on the open market. If a
farmer cannot use the products on his
own farm, they must be donated or
sold at a much reduced price on the
export market.
The Harkin-Gebhardt Bill would
have its greatest impact on the dairy
industry. Within 30 days of enact
ment, a referendum will be held
among commercial milk producers to
determine whether they favor a na
tional milk marketing base for calen
dar year 1988. If the majority votes
in favor of restrictive production, the
support level would increase to 70
percent of parity and would be in-
creased by one percent each year to
a maximum of 80 percent of parity.
A marketing quota would be
established for each producer based
on a five-year history from 1981 to
1985. An adjustment could be made
to bring supply in line with demand
on a national basis. Many questions
have been raised on the definition of
“base” because of the dairy diver
sion program.
The county ASCS committee could
adjust bases and allocate unused bases
to existing and new producers under
a priority system.
In order for the dairy industry to
reach the projected 24 billion pounds
drop in production, a large number
of cows will need to be culled within
a short period of time. Conservative
estimates would indicate nearly two
million culls within two years. The
market would be flooded with beef,
resulting in a dramatic drop in the
price of beef. Some economists arc
estimating as much as a SO percent
drop in price. In the long run, the
livestock industry which accounts for
half of farm cash receipts, would be
hampered by substantially higher feed
costs. Most feed lot operations do not
grow their own grain. They estimate
that the higher feed costs would be
passed along to the consumer in
higher beef prices. Such dramatic in
stability within the livestock industry
could prove devastating.
Other troublesome areas are the use
of tariffs and quotas to stem the flow
of agricultural imports. Foreign
retaliation would be swift and
disastrous to U.S. agriculture. Pro
ducer referendums by .commodities
would not allow those who would be
adversely affected by production con
trols to have a voice in the
referendum.
Lastly, the Harkin-Gebhardt has
made an attempt to deal with the farm
debt issue. It is failing to recognize
that farm debt is declining after
reaching a peak in 1982. Loan write
offs account for some of this, but in
many instances, farmers are ex
periencing an increase in farm in
come and are paying off some of their
debt. This should not be discourag
ed by a government program. Banks
are already restructuring some loans
and farmers are borrowing substan
tially less money.
The current Farm Bill (Food
Security Act of 1985) is not a perfect
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