WASHINGTON - For four generations, the Nedbalek family has tilled the sun-baked Texas soil, making a living out of growing cotton and grain on its 6,000-acre farm near Corpus Christi.
Despite his age, Bobby Nedbalek, 66, is often up before the break of dawn, preparing for the day's chores ahead. He usually works about 10 hours a day, and often up to 16 hours, during the harvesting and planting seasons.
"You must react to Mother Nature, and sometimes, she's pretty demanding," he chuckles.
Yet Nedbalek worries his way of life may be changed forever, as Congress prepares to draft new legislation to replace the 2002 farm bill that expires at the end of September.
With little extra money available for conservation and energy programs due to a burgeoning national budget deficit, many observers predict funding for those programs will probably have to come from cuts in farm subsidies. Nedbalek says that any such move to do so, however, would put him and thousands of other farmers across the country at risk.
The battle is already heating up on Capitol Hill, as various factions scramble to claim their share of what promises to be a tight budget for the farm bill. Arrayed on one side is the farm bloc, representing various commodity lobby groups, including the American Farm Bureau and the National Cotton Council. Facing them is an ad hoc alliance of non-profit organizations, think tanks and other interest groups.
Despite its moniker, the farm bill not only covers commodity programs but also encompasses and funds a host of other provisions on land conservation programs, rural development initiatives, agricultural research and the national food stamp program that affect not only rural communities but urban Americans as well.
At the heart of the struggle over the bill are its price and income support programs. The support program under the current farm bill uses direct payments, countercyclical payments and loan deficiency payments to boost farmers' incomes.
Federal farm programs were initially started in the 1930s to help farmers who were struggling with the effects of the Dust Bowl and the Great Depression. With record prices for corn and other crops in recent years, however, critics are calling the controversial subsidies programs anachronistic, saying American farmers have outgrown the need for them.
However, Nedbalek says that even though current prices are good, the crop subsidies are still vital to the livelihood of farmers, as they offset the losses during bad years.
"Last year, we only had 120 acres of cotton from all the land we farmed and 70 acres of grain," he says grimly, alluding to the drought that plagued the state.
"It was absolutely devastating."
Thanks to the farm subsidies and the insurance he had taken out on his crop, he averted what he says "would have been a very difficult situation."
"It's just an ideal kind of farm bill now," he says. "Cutting out any one of those programs wouldn't be good."
L.G. Raun, a rice farmer from El Campo, agrees.
"I would go out of business," Raun says simply. Because rice farming is such a high-risk business, a decrease or elimination of subsidies, he says, would finish him off.
Direct payments are fixed payments tied to a farmer's historical production base and are made regardless of what he grows. Under this scheme, even people who don't farm anymore or are living on old farmland would receive the handouts.
Countercyclical payments are also based on historical acreage and are designed to make up the difference between the prevailing market price and a government-established target price. In this way, farmers are able to ride out difficult years when prices are low.
Loan deficiency payments (LDPs) provide minimum price guarantees on the crop actually produced. When market prices fall below a government-set minimum, farmers are paid the difference in cash. This boosts farm incomes in times of low prices. The lower the price and the higher the production, the bigger the payment a farmer receives.
The administration unveiled a plan early this year that would save $1.5 billion over ten years by eliminating subsidies to people with adjusted gross incomes of more than $200,000 -- income after adjusting for certain expenses and deductions. It would also make the Unites States more compliant with World Trade Organization agreements by reducing trade-distorting subsidies.
However, it faces opposition from a number of lawmakers, many of whom come from major farm states where constituents support an extension of the Farm Bill in its current form.
The House Agricultural Committee, which spent this week drawing up its version of the bill, voted last week to ban federal subsidies to farmers making more than $1 million in adjusted gross income annually. Currently, farmers who make up to $2.5 million are eligible for the payouts.
It would continue subsidies for some large-scale crops, including corn, soybeans, cotton and rice. While it would stop farmers from collecting payments for multiple farm businesses, it increases the maximum limit in direct payments.
Domestic concerns are not the only worry for lawmakers, as the United States is under pressure to reduce farm subsidies from its international trade partners.
"Subsidies tend to encourage overproduction of crops like rice and cotton, which leads to lower prices on the world markets,"
Oxfam spokeswoman Laura Rusu explained.
This, in turn, hurts farmers abroad who do not enjoy the generous subsidies that American farmers receive. The U.S. is currently embroiled in a cotton trade dispute with Brazil, who successfully argued to the WTO last year that U.S. subsidies depress world cotton prices.
Organizations like the Environmental Working Group have also raised concerns that because current subsidies are based on farm size and production, they favor large operations at the expense of small family farms that need help the most.
Dr. Joe Outlaw, co-director of the Agricultural & Food Policy Center at Texas A&M University, calls such accusations inaccurate.
"They're not skewed to benefit the large farms any more than small farms," he says. "You got more acres, you get more payments."
However, Jake Caldwell, an agricultural trade expert at the Center for American Progress in Washington, D.C., says that almost 60 percent of all payments go to just 8 percent of farms in the United States. This dispels the myth that the government is helping small family farms stand on their own. Rather, he argues, it is the big operations that gain the most.
Caldewell says that the beneficiaries of the farm programs may not even be the individual farmers themselves, but rather large agribusinesses.
"The subsidies basically contributes to the large agribusinesses and helps them," he explains. "These folks benefit from a low price, so they can make food products out of it and make a huge profit on that."
In addition, a report released by Oxfam on Thursday said that minority farmers do not receive a fair share of government subsidies under current farm policies. This is partly because federal support programs subsidize commodity crops like wheat, corn, rice, soybeans, and cotton, which increasingly are grown on a relatively few large farms owned by whites.
The government paid out about $17 billion in subsidies last year. Of this amount, those five commodities received nearly 90 percent of those payments. By contrast, minority farmers tend to raise livestock or grow fruits or vegetables, which are not eligible for commodity price supports.
"I see all these people getting millions of dollars, and we're not getting anything but chunk change," says frustrated farmer Don Bustos, who grows vegetables in New Mexico.
Ben F. Burkett, a black farmer from Forrest County, Miss., says he used to plant corn, wheat, soybean and cotton until he had to make a difficult decision 15 years ago: either downsize or lose money.
Faced with that choice, he opted to downsize from 600 acres to 255 acres and grow just vegetables, even though that meant forfeiting the lucrative commodity payouts.
"You can't make money on planting just 100 acres on 200 acres of cotton anymore," he says. "You need at least a thousand or so to be profitable."
Burkett says subsidies have encouraged farmers to produce more, driving commodity prices commodities down and forcing smaller farmers to downsize or go out of business.
"In order to remain profitable, there is this constant pressure to grow bigger and bigger," Burkett says softly. "You can't ever catch up."
Ian Lye's e-mail address is [email protected]Cox News Service
