WASHINGTON - Congressman Marion Berry says he has “heartburn” – and it’s not the spices. A couple of issues are pressing the northeast Arkansas Democrat, and they may soon have producers reaching for the antacid too.
The first is an attempt by USDA administrators to redefine the family farm in a way that could leave a number of producers out in the cold when it comes to participating in some federal farm programs.
Under the definition proposed by USDA, a farming operation could not exceed $750,000 in annual gross farm income and still be considered a “family farm” and remain eligible for direct and guaranteed loan program or other forms of Farm Service Agency assistance.
A Federal Register notice published by USDA in February says farms could not exceed the greater of $750,000 or “95 percent of the statistical distribution of the income of farms in the state with gross sales in excess of $10,000.” (Analysts say the latter would establish a de facto limit of $750,000 in many states.)
“We’re preparing to resist this rule and get it stopped,” the congressman said in an interview. “This is an attempt to circumvent the intentions of the Congress and make people ineligible for benefits under the farm programs – direct and guaranteed loans.
“Basically, it would means-test and disqualify larger farmers. This would adversely affect Mid-South farms – we’d be disproportionately hit by this. This is just another attempt by the (Bush) administration to dismantle and means-test farm programs.”
To stop the rule change, producers need to get in touch with their Congressional delegation immediately, says Berry. A rule change must be published in the Federal Register for 90 days before Congress deals with it. The proposed changes were published on Feb. 9.
“We have only a couple of weeks before this becomes a rule,” says Berry.
Berry says other farm-state Congressmen have begun working to block the implementation of the rules change. “You should start seeing some press releases and serious action this week.”
A group of farm organizations, including the National Cotton Council, the USA Rice Federation and the U.S. Rice Producers Association, have also written USDA’s Farm Service Agency to express their opposition to the proposed rule.
“We do not believe that the proposed definition adds any clarity to the question of what is a “family farm” and would unnecessarily exclude legitimate family farmers from access to capital,” said the letter signed by 15 farm organizations and the American Bankers Association, the Independent Community Bankers Association and the Farm Credit Council.
“We also are greatly concerned that while this rule only affects farm lending programs, it could easily serve as a precedent for possible future income caps on other USDA farm programs.”
The second “outrage” that has Berry’s teeth on edge is the recent preliminary ruling by the World Trade Organization on American cotton subsidies. Many economists say the WTO ruling (which reportedly favors a complaint filed by the government of Brazil against the U.S. cotton program) will shortly mean complaints on subsidies for other crops.
“All of us from the Mid-South and the cotton-producing areas are upset about it,” says Berry. “I think the ruling was made in error. We wrote the 2002 farm bill with the assurances that it was GATT-legal. I don’t know how they’ve found it wasn’t. The entire last farm bill was considered to be in compliance with (trade treaties). We looked at that very carefully.”
Congressman faults Bush administration for ‘inaction’
Rep. Berry finds what he calls the inaction of the Bush administration in dealing with the WTO especially upsetting. “The thing that concerns me the most is the (Bush) administration,” he notes. “I don’t think they tried very hard to keep this from happening.”
Berry says the current move against cotton subsidies is simply a way for foreign ag interests to get what they want through back channels.
“Back in the 1980s and 1990s, environmentalists tried to impose environmental standards on the U.S. by agreeing to an international treaty that didn’t affect anyone except the United States – like the Kyoto treaty, the Montreal protocols and that sort of thing. It was clever – they wanted standards imposed that hadn’t been authorized by the U.S. Congress. I always thought that was a sorry way to do business and still do.
“What we’re seeing here (with the latest WTO ruling) is the first step in an attempt to dismantle farm programs by letting the WTO ruling take effect. Then they will say, ‘Well, we’ve got to be compliance.’”
While the cotton ruling is misguided, says Berry, the larger concern is the possibility other WTO member states will come after “every program we have. That could mean dismantling the farm programs and circumvent the will of Congress and the American people. It’s like turning our foreign policy over to the U.N. We’re turning our trade policy to the WTO. True, we must have an umbrella organization to oversee world trade. But if we allow this to go forward, it will cause huge problems for our country. I fear that’s what’s happening.”
Berry does agree with Brazilian trade officials’ use of the word “war” to describe their actions against the U.S.?
“It absolutely is a trade war, and I think it’s time to engage. Up until now, our trade negotiators, Ambassador Robert Zoellick and others in the U.S. Trade Representative's office have just rolled over on this issue. They said, ‘We don’t care about farm programs anyway. Just go ahead and do it.’ If they’d taken this issue seriously, it would have been negotiated out before it ever got to the WTO ruling.”
Imagine, he says, what will happen if competitors take this fight to other program crops. “They’ll essentially be making policy for the United States from outside our borders. We can’t have that.”
The United States, points out Berry, consumes more than any other country. “They need us a lot more than we need them. The United States has never exerted the influence we could in the international marketplace. The United States has always been very generous in allowing other countries to bring their products in. But if Brazil – or anyone else – wants to have a trade war, let’s have at it. They can’t stay in the game with us.”
How does Berry view comments by some of his fellow congressmen and Ambassador Zoellick to “let the WTO process run its course”?
“It’s fine with me to let the process run. But we must make it a two-sided deal - now it isn’t. Currently, (another nation) will file a WTO complaint, and we sit around and say nothing, don’t protect our producers. We let other countries beat us up and that’s been happening for years. We don’t make other countries come into compliance. We must, but they don’t. If these rules are to be enforced, they must be enforced from both sides. If that is done, this problem will go away. As I said before, the Brazilians or the EU can’t stay in the game with us.”
If the WTO ruling is left standing, “we will see the outsourcing of jobs and trade deficits explode. It’s very offensive to me that they can come into a sovereign nation and dictate public policy. That causes me a great deal of concern.”
The two concerns amount, Berry says, to an, “attack on Southern agriculture that is unprecedented. We’ve always had opponents, but both of these actions were taken under the radar careen. Both were either aggressively pursued or allowed to take place by the (Bush) administration even while there were people inside the administration who knew what the consequences would be. Still, they did nothing to protect our producers.”