Senate Votes to Cap Farm Subsidies

In an effort to rein in large payments to corporate agriculture, the Senate voted Thursday to cap annual federal subsidies at $275,000 per farm family.

The amendment--approved on a voice vote after an effort to derail it was defeated, 66 to 31--also would make the nation’s richest farmers ineligible for federal crop support.

The amendment represents an effort by senators to target assistance to small and mid-size family farms, as well as to change the image of agriculture subsidies, which have become increasingly viewed as another form of corporate welfare.

“Capping farm payments will restore integrity to farm programs,” said Sen. Charles. E. Grassley (R-Iowa), one of the amendment’s authors.

The Senate also heeded a request from President Bush and voted to restore food stamp benefits to legal immigrants who have been in the country at least five years.

The votes came as part of the debate on a five-year farm bill that would undo a 1996 law that aimed to wean farmers off federal subsidies. Overall, the bill would expand federal financial support for farmers, many of whom have been struggling through tough economic times for years, and would increase agriculture funding by $45 billion over five years.

A final vote on the Senate bill is expected next week.

A bill passed by the House last year would almost double the payments to farmers allowed under the Senate version. If the Senate bill passes, lawmakers will have to work out differences between the two versions before sending the legislation to the president.

In Thursday’s debate, senators from the South fiercely fought the amendment to cap crop subsidies, saying it would devastate farmers in the region who have had to enlarge their operations to remain competitive in a global market.

“Do you know what this farm bill says to the South? ‘Hold still, little catfish, all I’m going to do is just gut you,’ ” said Sen. Zell Miller (D-Ga.).

“Farmers need more support and higher prices because their costs are forever rising,” said Sen. Blanche Lambert Lincoln (D-Ark.). “Farmers are going out of business, and rural towns are heading for the abyss.”

Some California crop associations lobbied the state’s two senators--Barbara Boxer and Dianne Feinstein, both Democrats--to oppose the amendment. The lobbyists argued that it would hurt the state’s large agricultural enterprises, such as rice producers, which rely heavily on subsidies. But Boxer and Feinstein voted against the effort to derail the amendment.

The amendment establishes an annual limit of $275,000 in subsidies to a couple working a farm. In an effort to stop subsidies for wealthy individuals who have so-called hobby farms, it requires that an owner actively manage or work a farm to qualify for subsidies. It also bans subsidies for individuals with incomes exceeding $2.5 million three years in a row.

“There have to be limits,” said Sen. Don Nickles (R-Okla.). “If not, we are going to allow people to make millions off of these programs.”

The amendment was accepted despite Congress’ usual reticence about capping subsidies. Support was spurred by a Web site that listed names of those who have received farm subsidies, set up by the Environmental Working Group, a Washington-based watchdog organization.

Recipients of hundreds of thousands of dollars in federal farm payments over recent years have included such Fortune 500 companies as Chevron Corp. and International Paper Co., and wealthy urbanites including Charles Schwab, who heads a nationwide brokerage firm, lives in San Francisco and owns a rice and cotton farm in Northern California’s Glenn County, according to the database.

“This vote showed the power of information can energize citizens to overcome special interests,” said Ken Cook, president of Environmental Working Group.

The funds saved by the new restrictions, $1.3 billion over 10 years, would be used to extend eligibility for food stamps, particularly for low-income families with high rent costs.

The food stamp amendment approved Thursday would revise a portion of the 1996 Welfare Reform Act. Under that law, most legal immigrants were prohibited from receiving food stamps.

Since then, Congress restored benefits for some of those affected by the law, such as children and the elderly who arrived in the country before the act went into effect. The amendment would expand eligibility to legal immigrants who have lived in the U.S. five years.

“Making this change is the right and the humane thing to do,” said Sen. Richard Durbin (D-Ill.).

Environmentalists also praised the amendment because, in another provision, it would seek to remove the incentive for landowners to convert grasslands to cultivated fields by barring farmers from receiving subsidies on such fields. In part because of the lure of federal subsidies, farmers plowed 22 million acres of grasslands from 1982 to 1997 to grow crops.