Q: is American farm reform headed in the right direction?

0 Comments | Insight on the News, May 13, 1996 | by Pat Roberts, | Victor Davis Hanson

Yes: Farmers can now plant whatever they want and federal payments decline over seven years.

During the last year, I often have compared our efforts to reform outdated farm policies with the Texas-to-Montana cattle drive in the movie Lonesome Dove. We have fought off our share of hostile attacks and made it across more than one river full of snakes. But, like the gritty cowboys in the movie, we persevered and eventually reached our destiny.

The recently enacted farm bill represents the most sweeping change in federal farm programs since the Great Depression. Our "Freedom to Farm" bill saves taxpayers billions and gets the dead hand of government out of the business of farming. The bill eliminates obsolete mechanisms of farm policy that hinder international competitiveness and encourage poor soil stewardship. Farmers are set free to produce and compete in a growing global market. Predetermined annual payments are authorized to assist agricultural producers during the transition from an economy heavily dependent on government to one focused on markets.

On the strength of these arguments, the Freedom to Farm bill (renamed the Federal Agriculture Improvement and Reform Act) cruised to comfortable victories in both the House and Senate in late March. Nearly all Republicans and a good portion of Democrats supported the bill on final passage. In the House, we pulled off the unthinkable by producing a farm bill that was palatable to both House Majority Leader Dick Armey, a Texas Republican, and Rep. Bernie Sanders, a Vermont independent. With some reluctance, President Clinton signed the bill into law.

Still, a few critics remain. The populist left charges that we have eliminated the "safety net" for farmers; the purist right is unsatisfied with anything short of complete elimination of federal support to agriculture. To those critics who have not yet been baptized at the altar of Freedom to Farm, I once again will explain the policy rationale.

The original New Deal farm programs 60 years ago were based upon the principle of supply management. The thinking then was to control supply and raise prices. While this may have been possible a generation ago when our farm production was primarily for domestic consumption, it is sheer folly in today's global market. For the last 20 years, farmers have received federal assistance in return for setting aside (that is, not planting) a portion of their acreage. That assistance was largely in the form of deficiency payments to compensate them for prices below the government's target price for their production. That system has collapsed as an effective way to deliver assistance to farmers. Worldwide agricultural competition usurps markets when we reduce production. In short, the supply-management rationale not only fails under close scrutiny but also has enabled international competitors to increase their production by more than we "set aside."

The doctrine of supply management tied federal subsidies to the production of specific commodities such as wheat, corn and rice, requiring farmers to plant the supported crops year after year regardless of environmental consequences. Planting the same crop continuously led to excessive use of fertilizer, chemicals and tillage to control pests and maintain crop yields.

The Freedom to Farm bill was born of an effort to create farm policy from an entirely new perspective. Acknowledging that budget cuts were inevitable, the bill set up three goals for farm policy: getting the government out of farmers' fields; returning to farmers the ability to produce for markets, not government programs; and providing a predictable and guaranteed phasing-down of federal financial assistance.

By removing government controls on land use, the reform bill effectively eliminates farmers' chief complaint about the programs -- bureaucratic red tape and government interference. Endless waits at the county office of the Agriculture Department are over. Hassles about field sizes and whether the right crop was planted to the correct amount of acres are things of the past. A preliminary analysis by the General Accounting Office shows that $334 million will be saved just in Agriculture Department administrative expenses.

Benefits to the environment through deregulating agriculture cannot be overstated. Under this program, the government no longer forces the planting of surplus crops and monoculture agriculture. Farmers who want to rotate crops for agronomic and economical reasons are free of current restrictions. Good soil stewardship is good economics, since crop rotation produces higher yields and lower fertilizer and chemical costs. Farm-program participants still will be required to meet soil-conservation and wetlands-protection standards but otherwise will be free to manage their farm operations as they see fit.

American agriculture stands at a gateway of opportunity. Falling trade barriers under the North American Free Trade Agreement and the General Agreement on Tariffs and Trade, combined with population and income growth throughout the world, put U.S. agriculture on the brink of an export explosion the likes of which we have not seen in 30 years. Seizing this opportunity will mean sustained economic growth and jobs -- not just in rural farm communities, but in the cities of the farm belt in which modern manufacturing turns the productivity of America's farms and ranches into the food products lining grocery-store shelves worldwide. Failure to take advantage of this opportunity will further erode U.S. leadership in agricultural production.