House OKs Bill on Grain Sales to Soviets

The House Agriculture Committee approved legislation Wednesday to force the Reagan Administration to sell grain to the Soviet Union at subsidized prices, but there were signs that foreign policy worries could scotch the plan.

The panel approved the idea on a voice vote, with some dissent, as the Commerce Department announced the second straight monthly deficit in U.S. agricultural trade. Farm imports exceeded exports by $71 million in June after a May deficit of $348 million that had been the first such dip into the red since 1959. Under the year-old Export Enhancement Program, the government offers surplus commodities it owns as bonuses when purchases of U.S. farm goods are bought by targeted countries.

Major traditional customers of the United States such as the Soviet Union and China have been excluded, however, for foreign policy reasons, and grain traders say that restriction has meant that the program has hurt rather than helped exports. The House bill would force the $1-billion, three-year program to be used for sales to any country that has been a traditional customer--including the Soviet Union. The Senate already has passed similar language.

Backers of the bill said it was intended primarily as a lever to force the Reagan Administration to take quick steps to bolster sagging farm exports, and some conceded that they might accept a move other than the broadened Export Enhancement Program.

“We’re trying to get them to show some progress on exports,” said Rep. Pat Roberts (R-Kan.). “Perhaps it will not be an across-the-board EEP but some initiative that will keep us from limping along with the current export projections.”

Senate Majority Leader Bob Dole (R-Kan.), who has been pushing for a broadened subsidy program for months, said President Reagan has it under consideration and added that he hoped there would be a decision this week.

Deputy Agriculture Secretary Peter C. Myers, asked about Administration plans to boost exports, said: “At this point, the Administration is not proposing to expand the Export Enhancement Program. Most of the rhetoric right now is coming out of the Senate and the House.”

U.S. commodity sales abroad have dipped to an expected $27.5 billion this year from a peak of $43.8 billion in 1981, and failure to reverse that trend is seen as a potential political liability for the Republicans this election year.

Committee opinion on broadening the export bill was split, with some arguing that increased subsidies could only lead to conflict with U.S. allies who compete in the wheat market.

“The solution is to get together (with other subsidizing nations) and stop this silly use of treasuries to chase export sales around the world without any net gain for anyone,” said Rep. Tom Foley (D-Wash.). “It is economic folly for the European Communities, the United States and other exporters to subsidize rich countries like the Soviet Union and Japan.”