The Oregonian, Charles Pope
Published November 11, 2007
WASHINGTON -- Portland will never be mistaken for America's agricultural heartland. There are no stockyards within the city limits, no grain silos clustered in bunches or wheat fields stretching to the horizon.
Even so, a surprising number of Portland residents as well as thousands more across Oregon probably will be paying close attention this week as the Senate debates the $288 billion farm bill.
More than 1,000 people and entities with Portland addresses collected farm subsidies between 2003 and 2005, according to a database created by the Environmental Working Group from federal records. An additional 9,370 people and entities in Oregon received federal farm payments worth $88 million over those same years, the most recent for which data were available. Those include Oregon Sen. Gordon Smith, though aides say he kept none of the money.
The farm bill is a sprawling document that touches everything from food stamps to nutrition, conservation, energy independence, rural development and food labeling. But the fight this week in the Senate will focus almost entirely on money. That's with good reason: As written, the bill would cost $950 for each of the 303 million people in the United States.
This also might be the year for change. Never before, critics of the current law say, has there been a better opportunity for fundamental change in the rules for subsidies. The program, they say, is flawed and outdated, a relic of the Depression that showers money on very large farmers and conglomerates that grow wheat, corn, cotton, rice and sugar while bypassing small, often struggling, family farmers who grow fruits, vegetables and other commodities.
"Now is the time to reform our farm safety net to place reasonable limits on subsidy payments and ensure government subsidies are provided not to a select group of wealthy individuals, but to those that truly need them," Cal Dooley, president of the Grocery Manufacturers Association, said last week.
The grocery manufacturers are part of an improbable coalition that includes environmental groups, religious organizations and Republican-leaning tax groups, as well as conservative think tanks such as the Heritage Foundation that have close ties to the White House. All are demanding that subsidies be dramatically reduced and that the money -- by some accounts $16 billion -- be used for nutrition programs and conservation.
Supporters of the current system say it has yielded the lowest food prices in the world and that ensuring the viability of the nation's farms is critical to national security.
"We uphold the strength of all America when we uphold the safety net," Sen. Saxby Chambliss, R-Ga., said last week. "If we go down the path of crippling farm programs in response to newspaper editorials, the inevitable result will be the outsourcing of our food and fiber."
The American Farm Bureau Federation, with help from lobbying groups for corn, wheat, rice and other commodities, is using all of its considerable muscle to derail efforts to change the subsidy system.
"Farm Bureau strongly urges you not to adopt a farm bill that shifts money from the commodity title to increase funding for other programs including nutrition, conservation and rural development," the group's president, Bob Stallman, wrote last month to Sen. Tom Harkin, D-Iowa, chairman of the Senate Agriculture Committee.
It was a plea with power. In July, the Farm Bureau and other interests persuaded House Speaker Nancy Pelosi, D-Calif., to support the current system.
Pelosi said the move was necessary to protect vulnerable Democrats in rural and conservative districts that rely heavily on agriculture. Once her position was known, a proposal by Rep. Ron Kind, D-Wis., to limit subsidies -- also supported by Rep. Earl Blumenauer, D-Ore. -- was doomed. It lost 309-117.
Today the U.S. House of Representatives missed an important opportunity to seriously reform the Farm Bill," Blumenauer said in July after the bill passed the House. "Had we adopted the . . . amendment, which would have limited subsidies, supported smaller farmers and ranchers, and helped hungry people and the environment, my vote would have been different."
President Bush is not pleased, either. He has promised to veto the Senate bill, calling it too expensive. He supports lowering the yearly income standard for subsidies to $200,000 from $2.5 million.
Lawmakers opposing the bill make other points:
Commodity prices are at or near record levels, and farm income has never been higher. Federal budgets are tight, yet the current program pays money to farmers who have died and to thousands more who don't farm at all. In July, The Washington Post reported that $1.3 billion in subsidies have been collected since 2000 by people who do not farm.
"Farmers have not only joined the middle class, they've also joined the investor class," Scott Faber, a grocery lobbyist said last week. "In 2006, the average wealth of farm households was nearly $900,000, and a great proportion of that wealth came from off the farm, from investments."
Faber is part of a coalition, including Taxpayers for Common Sense, Environmental Defense, Oxfam and Bread for the World, that is lobbying the Senate to eliminate or vastly reduce subsidies and use the money for nutrition programs and conservation.
The politics are complicated.
The Senate bill prevents payments to dead farmers and denies subsidies unless recipients earn at least two-thirds of their income from the farm. It would ban payments to nonfarmers whose income is more than $750,000 a year. It also attempts to close a major loophole by banning a single farmer from collecting payments from multiple farm businesses.
Oregon's Republican senator could be under especially heavy pressure.
Government checks totaling $45,400 were sent to Smith between 1995 and 2005 as a result of his 50 percent ownership of Smith Frozen Foods Inc. Aides to Smith say he does not earn subsidies because Smith Frozen Foods does not farm. However, the company controls 600 acres of farmland in Umatilla County that is leased to independent growers. The subsidies simply pass though the company to farmers who lease the land.
Smith said in an interview that he has not decided whether he can support an amendment by Sen. Richard Lugar, R-Ind., that would abolish subsidies and replace them with federally backed crop insurance.
"It has some appeal. It's not something I have committed to," said Smith. "We need to give it a little more thought and perhaps it will jell into something concrete. The good thing about American agriculture is it has rebounded more than any sector of our economy with the competition between food and fuel. American farm future looks bright."
The House version of the bill bans farm payments to anyone who earns more than $1 million a year. It also appeased some critics by adding $1.6 billion to specialty crops, $4.7 billion for nutrition programs, and an extra $4.5 billion for conservation.
This week, the Senate will battle while under lobby bombardment from interests as diverse as food safety, energy independence and living standards in Africa.
Others, such as the Physicians Committee for Responsible Medicine, say current subsidies promote overproduction of high-fat and high-sugar foods that contribute to obesity. Still others, such as Oxfam, say overproduction depresses world prices for staples, denying farmers in western Africa a livable wage. And environmental groups say the law siphons money from habitat protection and wetland renewal to subsidize wealthy farmers.
It's a far cry from the days when the farm bill was written quickly and quietly by a select group of lawmakers largely from the Midwest and Southeast who made sure the law favored corn, wheat, soybeans, rice and cotton.
More recently, lawmakers have recognized the problems but have been powerless to make major changes.
This year, however, proposals are coming from surprising places. Sen. Charles Grassley, a Republican from Iowa and a farmer, plans to offer an amendment that would limit a married couple to $250,000 in subsidies each year. Current law allows $360,000 annually. Another has come from Lugar, who farms corn in Indiana when not in Washington.
"The law creates a system that is clearly out of balance," Grassley said from the Senate floor Nov. 6. "The top 1 percent is getting almost 30 percent of the payments."
Ironically, the debate has been reshaped by technology. In 2001 the Environmental Working Group created an online database of subsidies. The database now includes the name and amount of every recipient.
The data reveal, for example, that 1,088 people and entities in Portland collected subsidies, and 9,370 more in the rest of Oregon. Many of them do not come home with dirt on their cufflinks.
For example, the records show the late C.M. Bishop Jr., former president of Pendleton Woolen Mills, collected $262,871 in farm subsidies between 2003 and 2005.
But the Oregon subsidies are meager compared with those collected in the Midwest and Southeast. In 2005, the top 10 percent of all recipients nationwide were paid 66 percent of $21 billion in federal farm subsidies distributed that year.
Riceland Foods Inc., in Stuttgart, Ark., was the top recipient in the country in 2005, collecting $15.8 million.
In its simplest form, the battle this week will be about winners and losers. Newly emboldened critics of the farm program hesitate to predict an outcome, but they are taking solace in an idea expressed by Brian Riedl, an analyst with the conservative Heritage Foundation.
There is no direction but up.
"Lawmakers," he says, "would be hard-pressed to enact a set of policies more destructive to farmers, taxpayers and consumers than the current farm policies."
