Farmers Urge Policy Based on Market Forces

The American Farm Bureau Federation urged Congress on Thursday to replace government farm subsidies and crop controls with a farm policy based on supply and demand. But it stopped short of endorsing an end to the price-support system, which is generating increasing controversy among the nation’s growers.

Existing farm legislation setting up a rigid system of price supports for 10 basic agricultural commodities expires this year. The Farm Bureau blames that system--which cost the federal government $12 billion last year--for inflating U.S. prices above world prices, resulting in lost export sales and reduced farm income.

The organization, representing county farm bureaus across the country, is meeting this week to agree on a platform that will become its base for lobbying Congress as it takes up new legislation this year to replace the Farm Act of 1981.

Over the five days of its annual meeting, the bureau repeatedly has castigated “the politicians” in Washington for interfering with agricultural market forces to the detriment of farmers and ranchers. But, ironically, governmental “interference” in the form of price-support subsidies and other payments has also meant the difference between solvency and bankruptcy for many small growers, particularly in the Southern states.

A move backed by Western growers that would have set a four-year deadline for dismantling the farm program was defeated by a surprising coalition of Southern and Midwestern growers.

As a result, the Farm Bureau’s official policy calls for price supports “as income supplementation for farmers to help them make the adjustment to a market-responsive agriculture.” The statement acknowledges that price supports must be temporary but stops far short of setting a deadline.

Western farmers were disappointed that no deadline was imposed. “I would have preferred setting a day of reckoning,” Henry J. Voss, president of the California Farm Bureau, said in an interview.

Voss, a peach grower from the San Joaquin Valley, said, however, that “the thread of philosophy that winds through the policy is that we need to move toward less government involvement.” The lack of a deadline will provide “weasel room” that may prove valuable in negotiating a revised farm program with Congress, he said.

Expiration of the 1981 Farm Act is receiving additional attention this year because the Reagan Administration has made it clear that it plans to press for big cuts in farm spending in its effort to reduce the federal budget deficit.

Regional politics play an important role in the decision making. An apparent coalition between the pro-price support Texas delegation and delegates from the more conservative grain-growing states of Iowa, Indiana and Illinois led to the elimination of a specific deadline for phasing out the farm program.

Although Iowa first proposed the four-year deadline, it abruptly moved to withdraw its own motion after Texas proposed stiff controls on grain production.

Once the toned-down farm-program policy won approval, the Texas delegation quietly dropped its proposal.

National President Robert B. Delano told reporters as the convention adjourned Thursday that the farm bureau has been “philosophically committed for a long time” to a market-oriented agriculture but conceded that the “steps are very small” toward realizing that concept.

He agreed that “the implication is there” that price supports should be phased but added: “I don’t that it actually says it.”