Criticism rains on Obama's farm subsidy cut idea

[Ban Hammer 13,643]

WASHINGTON (Reuters) – Wally Darneille has two words for President Barack Obama's proposal to end the so-called direct payment subsidy to large U.S. farmers: "That's insanity."

"I think we're really going down the wrong path here," said Darneille, the head of a farmer-owned cotton marketing cooperative in Lubbock, Texas.

An array of lawmakers and farm groups agree, suggesting poor odds for the idea to become law.

Foes say the idea is poorly timed and aimed at growers who account for three-fourths of farm production. Two longtime Senate backers of farm subsidy reform oppose Obama's proposal.

As part of his 2010 budget, Obama proposed phasing-out direct payments to farmers with sales of more than $500,000 a year, to save $9.8 billion over 10 years.

Direct payments, which total $5.2 billion a year, are paid regardless of crop prices.

"Large farmers are well-positioned to replace those payments with alternate sources of income from emerging markets for environmental services, such as carbon sequestration, renewable energy production and providing clean air, clean water and wildlife habitat," the White House budget documents said.

Criticism of the direct-payment plan eclipsed a companion White House proposal for a $250,000 a year cap on farm subsidy payments, the usual battleground for controlling subsidies.

"Most full-time farmers, commercial farmers ... it looks to me like they're going to get hit," said Daryll Ray, a University of Tennessee agricultural economist.

"It will include any livestock operations you have. You might even go over (the sales limit) on livestock alone."

A farmer could reach $500,000 in sales with 885 acres of corn or 2,250 acres of lower-yielding wheat.

Roughly 126,000 U.S. farms have sales over $500,000 a year, according to the Agriculture Department.

"We did some figuring, and it would not take much to get to that cap, said Tim Bartram, who farms 400 acres of wheat in Guthrie, Oklahoma. "They are showing a real lack of understanding of agriculture."

FAMILY BUSINESS

Gregory Guenther, a farmer from Belleville, Illinois, said the "agribusinesses" are actually family operations.

"Brothers or a father and son or whatever have combined their resources, their acreage, into one big operation in order to capture volume discounts on seed, fertilizer, chemicals, or things like that which make them more efficient," he said.

"Each of those individuals that are involved in this so-called corporate farm, they only have the income off of a few hundred of those acres," said Guenther.

Bartram and Guenther were interviewed at a farm conference in Grapevine, Texas. Darneille spoke at an USDA meeting.

The Obama proposal faces opposition in Congress, which has taken the lead in farm policy in recent years.

Lawmakers overrode two presidential vetoes last year to enact a five-year farm law that bans crop subsidies to people with more than $500,000 in income from off the farm and tightened subsidy rules somewhat.

They rejected a $250,000 payment cap.

"We just passed a fiscally responsible Farm Bill that made cuts to farm programs, so now is not the time to reopen it," said House Agriculture Committee chairman Collin Peterson.

Senate Budget Committee Chairman Kent Conrad, a North Dakota Democrat, said he opposed any effort to cut support for the farm safety net, especially when the economy was so weak.

The two most direct ways to cut direct payments would be for the House and Senate Agriculture committees to pass a bill or for the budget panels to order long-term cuts.

Opposition by Peterson and Conrad would make those routes more difficult.

"While it aims for the right goal, the approach outlined in the president's budget is not the best way to ensure farm payments go to those who need it most," said Iowa Senator Charles Grassley, a Republican who favors a $250,000 cap on payments.

"I'm a farmer and I know that gross income or sales revenue does not reflect your ability to pay."

Jay Hardwick, chairman of the National Cotton Council, said "the direct payments are critical to a producer's ability to secure financing."

Bob Young, an economist for the American Farm Bureau Federation, said farmers often feel under attack from their city cousins and that it was time to build connections with them. "I think we need a renewed emphasis on what is involved in agriculture today," he said.

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[johndecka 0]

THat's why

RUSH said,"I HOPE OBAMA FAIL."

Obama is like a Piper, leading us to the River.

[Mr. Big Dog 10,747]

The GOP is all about cutting pork. Time to get serious, guys. Large business welfare here that should have been cut a long, long time ago - in fact, it should have never been allowed in the first place. Where's the self-reliance that the heartland always cries for?

[Ban Hammer 13,643]

The GOP is all about cutting pork. Time to get serious, guys. Large business welfare here that should have been cut a long, long time ago - in fact, it should have never been allowed in the first place. Where's the self-reliance that the heartland always cries for?

you do like to eat, don't you? american farmers have been under the gun for quite a while due to imports.

[Mr. Big Dog 10,747]

The GOP is all about cutting pork. Time to get serious, guys. Large business welfare here that should have been cut a long, long time ago - in fact, it should have never been allowed in the first place. Where's the self-reliance that the heartland always cries for?

you do like to eat, don't you? american farmers have been under the gun for quite a while due to imports.

A "farmer" that nets 500K a year doesn't need taxpayer funded welfare.

[Ban Hammer 13,643]

The GOP is all about cutting pork. Time to get serious, guys. Large business welfare here that should have been cut a long, long time ago - in fact, it should have never been allowed in the first place. Where's the self-reliance that the heartland always cries for?

you do like to eat, don't you? american farmers have been under the gun for quite a while due to imports.

A "farmer" that nets 500K a year doesn't need taxpayer funded welfare.

i'll agree to that. however, not many make that. probably only the large corporate owned farms can make that kinda cash.

[lostinblue 1,989]

The GOP is all about cutting pork. Time to get serious, guys. Large business welfare here that should have been cut a long, long time ago - in fact, it should have never been allowed in the first place. Where's the self-reliance that the heartland always cries for?

you do like to eat, don't you? american farmers have been under the gun for quite a while due to imports.

A "farmer" that nets 500K a year doesn't need taxpayer funded welfare.

Obama proposed phasing-out direct payments to farmers with sales of more than $500,000 a year,

Go take an accounting course so you can understand this article

revenue minus expense equals net income. " Sales" ....... not the same as net income.

[HAL 9000 96]

Seems like we're skirting this issue. Perhaps Obama should have rethought some of the details or perhaps we are not looking at all of the details in their entirety.

Usually this kind of target I would assume to have more to do with the government targeting huge corporations that are actually squeezing the life out of smaller farms- including farming cooperatives and smaller farmer-run businesses by the skillful art of competition. Perhaps this is the case, and we are seeing the fringe effect on the upper levels of these less-large conglomerates starting to freak out.

I've never met a farmer netting $500K per year anyway. I have seen the Monsanto types making off quite well though.

[Ban Hammer 13,643]

The GOP is all about cutting pork. Time to get serious, guys. Large business welfare here that should have been cut a long, long time ago - in fact, it should have never been allowed in the first place. Where's the self-reliance that the heartland always cries for?

you do like to eat, don't you? american farmers have been under the gun for quite a while due to imports.

A "farmer" that nets 500K a year doesn't need taxpayer funded welfare.

Obama proposed phasing-out direct payments to farmers with sales of more than $500,000 a year,

Go take an accounting course so you can understand this article

revenue minus expense equals net income. " Sales" ....... not the same as net income.

and combines aren't cheap pieces of equipment either.

I've never met a farmer netting $500K per year anyway. I have seen the Monsanto types making off quite well though.

i don't know of any that make over 100k, more like 50k and 16 hour days all year long.

[HAL 9000 96]

Pretty much. I know farms are not cheap to run...

[Niels Bohr 72]

126,000 Farmers making over 500k. Geezes.

[Ban Hammer 13,643]

126,000 Farmers making over 500k. Geezes.

out of how many farmers?

[Dan J 277]

Why should we subsidize farmers who can't profitably produce their products? If another country can produce the same food for less money, why shouldn't we just buy from them? Isn't that the whole idea of free trade?

It seems to me, the only really reason we subsidize small farms is because of the sorta romanticized ideal of American life they represent.

[Ban Hammer 13,643]

Why should we subsidize farmers who can't profitably produce their products? If another country can produce the same food for less money, why shouldn't we just buy from them? Isn't that the whole idea of free trade?

It seems to me, the only really reason we subsidize small farms is because of the sorta romanticized ideal of American life they represent.

great thinking, i'm sure that would work real well when some country cuts off our food supply in order to strong arm us.

[HAL 9000 96]

Why should we subsidize farmers who can't profitably produce their products? If another country can produce the same food for less money, why shouldn't we just buy from them? Isn't that the whole idea of free trade?

It seems to me, the only really reason we subsidize small farms is because of the sorta romanticized ideal of American life they represent.

great thinking, i'm sure that would work real well when some country cuts off our food supply in order to strong arm us.

I'm sure you could probably then give your business to another country then. Or *gasp* pay more for it at home. The magic of trade.