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DIRECT PAYMENTS NEEDED, SAY FARMERS AND REPS

By Erin France/ OF THE COMMERCIAL STAFF
Saturday, March 21, 2009 11:53 PM CDT

Local farmer Jamey Price does not like it when the federal government steps into his territory — how to run a farm.

Jamey Price walks through a rice paddy. He is one of several Jefferson County farmers who could be affected by President Barack Obama’s proposed $500,000 cap on crop sales revenue. By Don Plunkett

“It’s not going to sit well with any farmer,” Price said.

President Barack Obama has proposed limits of $250,000 in federal direct payments to farms and phasing out direct payment to farms with sales revenue greater than $500,000.

The direct payments are tax dollars from the federal government for stabilizing farm incomes.

Price said his farm might not be affected, but he worries about the ramifications.

“It makes you uneasy about it,” he said.

Any restrictions on direct payments could hurt agriculture, especially, Price said, if other farmers are seeing the same trend he’s seen in the last year.

“My expenses are steadily going up but my profits are steadily going down.”

Price said he feels like the Arkansas representatives in Congress understand the hurdles he and his neighbors face.

“We hope we’ve got enough people fighting for us,” he said. “I just hope that we have enough firepower to fight what you know the American farmer deserves — and that is support from

the American government and support from the American consumer.”

Price said support could come in the form of opening up foreign markets, like Cuba, to Arkansas rice farmers, or finding cheaper fuel.

“I just wish that they would give us, you know, a fair market,” Price said. “Not just in commodity prices but ... on expenses out of our hands.”

While there are many different entities controlling the market, Price said it’s the farmer who takes most of the lashings.

“You’re at the mercy of the weather. You’re at the mercy of the commodity prices,” he said. “If somebody in this business is incurring extra costs, who are they going to pass it to? It’s my bottom line.”

Farmers, and those who represent them, say the proposed limits are due to politicians’ misperceptions.

“There’s a huge misunderstanding about the economics of row crop agriculture, I think,” said Bobby Coats, an extension economist for the University of Arkansas Division of Agriculture.

Many see direct payments as a farming safety net.

The proposed limit in Obama’s budget is too low, said Bill Bridgforth, a Pine Bluff attorney and an expert in agricultural law and policy.

“A cotton picker can cost as much as that,” he said.

By limiting payments, Congress hopes to abolish the non-resident farmer, Bridgforth said.

These can be business partners on a farm, but as individuals or entities, they do not participate in daily farming activities.

Still, there’s value to direct payments even with those exceptions, Bridgforth said. There’s also value to studying the farm bill, something Obama has only had a few months to do.

“He didn’t grow up in the agricultural world,” Bridgforth said. “I would just hope that he would revisit this.”

There were about three years of discussions before the 2008 farm bill came about, and changing is inadvisable, Bridgforth said.

“In my opinion, he’s making a mistake,” he said. “Without the farm payments you simply could not farm.”

Price Tag

Obama’s suggestion for limiting farm payments is a way to contract the government’s expenses, Bridgforth said.

According to Environmental Working Group, Jefferson County received $10.2 million in direct payments in 2007. The state of Arkansas received $248 million the same year.

The six-year 2002 farm bill cost taxpayers an estimated $93.3 billion according to the Congressional Budget Office in 2007.

Direct payments count for about 12 percent of the total farm bill, Bridgforth said.

“I think that’s such a small amount in the grand scheme of things,” he said. “Perhaps in the politician’s mind it sounded good to the rank-and-file voter.”

“I oppose any cuts to direct payments as our farmers and farm families depend on this federal assistance to stay in business,” Rep. Mike Ross, D-Prescott said.

“I fought hard for this assistance in last year’s farm bill and will oppose any planned cuts or moves to prematurely rewrite the Farm Bill by the Obama Administration.”

Bridgforth said he does not think the cap will materialize.

“It’s my impression, that if it stays in the budget — the budget will not pass.”

More than computers

Kenny Bonds grows cotton, rice and soybeans and says he’s keeping an ear on what the Obama administration is proposing for farmers. He said the $500,000 cap could affect plenty of farms in Jefferson County.

“Oh yeah, yeah, that’d be really bad,” he said. “Anything with any kind of size would be affected.”

Like Price, it’s not just the federal government that concerns Bonds.

“Everything is such a mess right now.”

Bonds said he’d like to see decreasing input costs by finding resources for homemade fertilizer and fuel.

“We need to manufacture things here and not just sell each other computers and insurance,” he said. “We should have learned that lesson from our oil.”

Like Bridgforth, Bonds sees the need to keep American consumers purchasing local crops.

“We need to stay viable in agriculture in the United States so every body can eat,” he said. “You can’t depend on the rest of the world for that.”

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