Senate OKs $7.4 Billion in Farm Aid

The Senate on Wednesday approved $7.4 billion in assistance for farmers hurt by depressed crop prices, setting the stage for negotiations with the House.

Democrats and some farm-state Republicans wanted more money, including special assistance for Eastern growers who are suffering through one of the region’s worst droughts this century.

GOP leaders beat back several attempts to fatten the package, but they signaled their willingness to consider adding money later, during talks with the House.

“We think this is a very strong program. . . . It’s a strong commitment,” said Sen. Thad Cochran (R-Miss.).

Sen. Charles E. Grassley (R-Iowa) said the Senate action should be a clear signal to farmers and their bankers that help will be on the way this fall.

The money was added by voice vote to the Agriculture Department spending bill for the fiscal year beginning Oct. 1.

The House version of the measure contains no disaster aid, but Speaker J. Dennis Hastert (R-Ill.) said recently that the House is “committed to taking decisive action.”

A House-Senate conference committee will begin negotiating the final assistance package in September after Congress returns from a monthlong recess.

Prices for corn, soybeans, wheat and other crops have slumped to lows not seen by farmers in years, even decades in some cases, because of huge crops worldwide. Federal farm subsidies already were expected to reach a near record $16.7 billion, even without the additional assistance Congress is considering.

The Senate’s aid package includes $5.5 billion in direct payments to most growers, a separate $475 million for soybean growers and $400 million in subsidies for crop insurance.

The measure also would double--from $75,000 to $150,000--the cap on crop subsidies that an individual farmer can receive.

Democrats had sought $11 billion in assistance but conceded defeat after losing battles over several smaller packages. Their plan included $500 million in disaster aid for drought-stricken growers on the East Coast and Midwest farmers whose land is flooded.