More Farm Aid Backed by 3 in GOP : Key Senators Join Democrats Fighting President’s Plan

As farmers and farm-state legislators swarmed to the Capitol seeking federal help, Senate Democrats won the backing Monday of three key GOP senators for legislation that would expand emergency relief to American agriculture--measures opposed by President Reagan and Senate Republican leaders.

At the same time, Sen. David L. Boren (D-Okla.), who spearheaded a four-day filibuster last week over the farm credit crisis, said he feared the President was backing away from his previous promise to provide extra help for farmers.

Boren called on Reagan to explain why, when discussing the farm credit issue in his weekly radio address Saturday, he did not mention that he already had agreed to provide additional money after an aid agreement was worked out under pressure from Democrats.

Two Measures Unveiled

Led by Boren, a group of farm-state Democrats on Monday unveiled two measures designed to expand those aid programs even further. Among other provisions, the legislation would make available $1.85 billion in additional money for loan guarantees to farmers through the Farmers Home Administration.

Senate Majority Leader Robert J. Dole (R-Kan.), saying he opposed the measures, noted that the White House and the Senate Republican leadership view the Administration’s existing farm credit program as sufficient to handle the crisis. He also hinted that Reagan would veto any such legislation, if enacted.

“It seems to me we ought to give this (existing) program time to work,” Dole said. “I believe we’ve moved in the right direction.” Moreover, he added, it would be cruel to hold out the hope of financial solvency to those farmers whose debt problems are too big even to be erased with government help.

Republicans Join Democrats

But the President’s opposition did not stop three farm-state GOP senators--Mark Andrews of North Dakota, Larry Pressler of South Dakota and Charles E. Grassley of Iowa--from joining forces with the Democrats to sponsor the additional emergency farm aid. The expanded aid proposals were being offered as amendments to a bill that would provide emergency famine relief to starving Africans.

The co-sponsorship of Andrews, Pressler and Grassley indicates that other Republican farm-state senators might cast their lot with the Democrats when the measures come up for a vote later this week. Senate passage of the farm bail-out legislation, which is still considered uncertain, would be a major defeat for Dole and the President.

The urgency of the problem facing America’s farmers was outlined by legislators from nine farm states at a Joint Economic Committee hearing chaired by Rep. David R. Obey (D-Wis.), who accused the Administration of perpetrating “a cruel hoax and an economic delusion” by advancing the idea that expanded farm exports will solve the crisis in rural America.

“If we lose our farmers, local lending institutions, feed and seed suppliers, implement dealers and Main Street businesses, we are going to lose a very important way of life in rural America,” state Sen. Rod Moen of Wisconsin declared. He said the value of Wisconsin farm land, for example, has fallen from $20.5 billion to $17.5 billion since 1981.

In an especially dramatic move, all 105 members of the South Dakota Legislature are expected to lobby today in Washington for more emergency farm aid. The South Dakotans will meet with Vice President George Bush, Agriculture Secretary John R. Block, Federal Reserve Chairman Paul A. Volcker and congressional leaders.

Senate Democrats said their proposal for emergency aid specifically provides $1.85 billion for loan guarantees because they are skeptical that Reagan will live up to his promise to permit unlimited funds to be spent for that purpose. They noted that Reagan, in his speech Saturday, only mentioned spending $650 million for loan guarantees without saying that he had agreed to a larger amount.

Clarification Sought

On Monday, Boren called on the White House to clarify the matter. “I’m not questioning the integrity of the President,” Boren said. “It could be there’s simply confusion at the White House on the subject matter we’re dealing with.”

A key feature of the new legislation would be to advance to farmers at planting time up to 50% of the money they would normally collect after harvest through the federal Commodity Credit Corp. Dole estimated that would cost $10 billion, but Boren insisted that it would cost no more than funds already allocated.

Boren noted that $18 billion has been set aside for the Commodity Credit Corp. program and that the Democrats’ proposal, to be introduced today by Sen. Alan J. Dixon (D-Ill.) along with Pressler and Grassley, would only spend that money a little earlier than planned.

But Dole estimated that 8% to 10% of the farmers receiving the advance payments would probably default, leaving the federal government to make up the loss.

Additional Loan Guarantees

A second measure, which was introduced Monday by Sen. Edward Zorinsky (D-Neb.) and Andrews and which would set aside the $1.85 billion for additional loan guarantees, also provides $100 million through the Agricultural Credit Insurance Fund to buy down the interest rate on farm loans made by commercial lenders.

Meanwhile, Sen. Alan Cranston of California, the Senate’s second-ranking Democrat, said he has decided against proposing a particular loan guarantee formula sought by California growers and the Bank of America. He said he made his decision because the Administration already has authority to carry out the proposal under existing legislation.

Block, speaking to the National Conference of State Legislatures, called on farm-state legislators to trust the Administration’s program. “We have to play our hand with the deck of cards that have been dealt to us,” he said.

But Block won few, if any, supporters. The conference has called for a national moratorium on farm foreclosures and a farm debt recovery program.

“Debt restructuring is going from a life sentence to Death Row out there,” said Minnesota state Sen. Charlie Berg. And California state Sen. Rose Ann Vuich dismissed it as “just rhetoric.”