Reagan Failed to Aid Farmers, Officials Say

President Reagan’s campaign promise of $650 million in credit relief for farmers has gone virtually unfulfilled, partly because of Administration insensitivity to the problems of agriculture, a delegation of Iowa public officials charged today.

Gov. Terry Branstad, a Republican, and the state’s eight-member bipartisan congressional delegation charged that the White House has been slow in coming up with regulations for the credit relief plan, possibly in a deliberate attempt to curb its use and save government money.

“Too many people feel that because only 3% of people in the country are farmers, that maybe there’s no crisis out there,” GOP Sen. Charles Grassley said at a news conference.

Serious Proportions

But Grassley and the others said the credit crunch has reached grave proportions in their state and soon will be just as serious in other farm states from the Dakotas to Texas.

“It has a ripple effect throughout the entire economy,” affecting banking, small business and ultimately consumers, Grassley said. Agriculture and food production are the nation’s No. 1 industry, employing directly or indirectly one of every five Americans.

Branstad said some farmers face an immediate credit crisis, needing money to make annual lease and mortgage payments on March 1, the traditional date for such payments. They then will need loans to plant spring crops, he said.

Even if the Administration were to settle on the rules for its announced credit aid, the $650 million would not be enough, Branstad said. He called for an increase in aid to $3 billion.

The group advocated changing the rules of the credit relief program, which is to provide federal loan guarantees to lenders if they agree to write off part of the loans to farmers.

The program would be more effective, they said, if a write-off in interest rates were substituted for the current plan of knocking at least 10% off a farmer’s loan principal.

The Administration announced the credit package on Sept. 18, a day before a Reagan campaign swing that included farm states.