The Right Action--on Thin Ice

President Reagan did the right thing in vetoing the bill dealing with the farm credit crisis. His action carries with it, however, responsibility to make sure that the emergency measures that he has already taken prove to be as effective and adequate as he has said they are.

The President seemed most concerned about the cost of the proposals and in demonstrating with the veto his determination to hold the budget line on domestic programs. There he was on thin ice. The costs of the programs proposed by Congress were not likely to disrupt efforts to reduce the budget deficit. The President already is committed to more than $4 billion in expanded credit programs implemented by administrative authority since September.

More to the point was the fact that the legislation before him was both imperfect and unnecessary. Among its imperfections was the absence of the provisions of the original House bill to give loan relief to farmers devastated by natural disasters in three of the last five years.

The basic problem of credit for spring planting had already been addressed by the decision of the Department of Agriculture to lift the ceiling on loan-guarantee funds and to liberalize the rules for both federal guarantees of commercial loans and direct federal loans. The effect of the crisis also has been modified by the Administration's decision to make advance deficiency payments and to accelerate commodity loans, pushing an estimated $15 billion into farmers' hands by April 1.

The legislation that was vetoed might have helped sustain some insolvent farmers for a few more months. That is not an appropriate goal of the federal program. The priority must be to help effective farmers stay in business. That problem is now being tackled in Washington with the drafting of the 1985 Farm Act. Future farm prosperity may depend on that more than anything else.

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