The Hill / March 28, 2001, Wednesday / By Rep. Earl Pomeroy
There is strong agreement throughout the agriculture community that the next farm bill must provide a measure of protection to farmers when commodity prices collapse. Over the last three years alone, Congress has appropriated $27 billion of economic and natural disaster assistance for farmers in response to the crisis in the agriculture economy.
Although this assistance has been extraordinarily important and has literally kept thousands of farmers from going out of business, its ad-hoc nature has created uncertainty for the farmer and inefficiency for the taxpayer.
I commend House Agriculture Committee Chairman Larry Combest (R-Texas) and Ranking Member Charlie Stenholm (D-Texas) for holding a series of hearings to solicit input from all the major farm and commodity organizations as to how the farm program must be reformed.
Many different ideas have been proposed but there are at least two common themes: 1) the farm program should be counter-cyclical - i.e., assistance should increase when commodity prices and farm income decline and decrease when economic conditions improve; and 2) reforming the farm program will require substantially more money than is currently in the budget baseline for agriculture. In fact, a coalition of 23 major farm groups recently wrote to the House and Senate Budget committees requesting an additional $117 billion over 10 years for agriculture.
Without additional resources, there can be no meaningful improvements made to the failing farm program presently on the books. Unfortunately, the president's budget request not only omitted additional funding for agriculture, it appears to have reduced the agriculture discretionary budget by 8.6 percent.
The budget resolution voted on last week adopts the president's request. In response to concerns raised, both the president and the congressional majority point to a "contingency fund" as the source of additional funding for agriculture, defense and every other priority that members point out is underfunded in the base budget.
We are now experiencing a case of the " incredibly shrinking contingency fund." In his joint session address, President Bush claimed that his budget set aside $1.4 trillion for contingencies. But this amount included interest payments to bondholders and revenues reserved to pay Medicare benefits. Subtracting these items leaves about $600 billion, which is approximately the amount of contingency funding provided in the Republican budget resolution.
Even this amount, however, is highly questionable when you consider that the tax bills passed by the House and the Ways and Means Committee have increased the cost of the Bush tax cut by $250 billion; it is also becoming clearer each day that Congress will address the Alternative Minimum Tax at an estimated cost of $300 billion.
In the end, the contingency fund will not support even the inadequate request by the president for prescription drugs and education, not to mention the hundreds of billions that will likely be requested for defense following the strategic review and the funding requested for agriculture.
Unless the majority dramatically changes its budget approach, I am afraid that agriculture will be one of many victims of the incredibly shrinking - even vanishing - contingency fund. Without additional funding, it will be impossible for Congress to craft a farm bill that protects the interests of family farmers and ensures our continued access to the world's highest quality and lowest cost food supply.
Rep. Pomeroy, a Democrat from North Dakota, is a member of the Ways and Means Committee.
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