Aid cap to hurt farmers -
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Published on: 6/26/2001
Last Visited: 2/8/2002
Such payment limits hit crops with depressed prices and high cost of production especially hard, and growers of two of Louisiana's top crops, cotton and rice, have been seeing very low prices, said Jim Monroe, assistant to the president of the Louisiana Farm Bureau.
The Senate has not taken its final vote on the farm bill.Even after it passed, the Senate amendments -- including the subsidy cap -- must get the blessing of the U.S. House of Representatives.
The key vote was a 66-31 procedural vote to create the subsidy limits as an amendment to the farm bill.U.S. Sens.
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Farmers of lower-priced crops lean more heavily on government supports to make ends meet, so they would hit the limit quicker than growers of more-profitable crops such as corn, Monroe said.
Cotton farmers, for instance, can break even if they sell their crop for about 50 cents a pound, but cotton has been selling for less than 35 cents a pound.
"The lower the market price, the more of a difference between market price and support price," Monroe said.
Louisiana farmers harvested about 855,000 acres of cotton and about 546,000 acres of rice in 2001.
Corn acreage, which surpassed cotton's as recently as 1998, dropped off sharply in the late 1990s after outbreaks of a fungus that rendered massive amounts of the crop unsaleable.
Louisiana corn farmers harvested 307,000 acres in 2001.
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Family farms in Louisiana have grown and merged through marriages or partnerships among different families, and the proposed cap would act to stop that kind of growth or even break up those partnerships, Monroe said.
With the cap set on a per-farm basis, partners in a family farm who have been able to each get a piece of supports for their share of the entire farm would find themselves sharing the support under a single cap, he said.
"You're essentially punishing people who have worked hard to get their operation economical by growing," Monroe said.
The huge corporate farm model, which is held up as part of the reason for the cap, is not a major factor in Louisiana agriculture, Monroe said.
Bigger farms would mean bigger risks because the cap would only cover a certain amount of potential acreage before farmers are operating without any support for possible shortfalls in production and price.
Less support means more trouble in farmers getting financing, which more and more farmers need to get a crop in the field.
The per-farm basis of the cap could even affect whether families become families at all, Monroe said.
"They talk about the marriage penalty in income tax," he said."That is about the ultimate marriage penalty in that farm bill."
The cap would act as a marriage penalty because only one member of a husband-and-wife farm partnership, who had been treated as equal partners under the current farm bill, would be eligible for the full amount under the proposed cap, Monroe said.
A married couple running a farm would be better off financially getting divorced immediately and divvying up their farm into two farms, so both would be eligible for full cap benefits, he said.
"It makes people do strange things," Monroe said.
The cap would come at an especially bad time for cotton farmers, who have had to wait until very close to planting season to see whether they can get enough guarantees of federal support to get financing for this year's crop.
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