1. IN THIS CORNER, BIG AG...

Round one of the US Farm Bill negotiations has just about ended. In one corner, weighing in with billions of dollars in backing and a savvy and entrenched lobbying presence, Big Industrial Ag. In the other corner, a quick and growing alliance of family farm, church, conservation and consumer groups trying to make the farm bill greener and more family-farmer friendly. So far, with round one nearing completion, Big Ag has edged ahead. Still, this promises to be long and heated contest.

Highlights follow..

Last week President Bush released his recommended Ag budget and it clearly favors Big Ag. The President proposed spending roll backs on many programs including conservation and rural development while managing to find hefty increases for trade, food inspection and crop insurance. (See story below for more detail) Meanwhile, the House and the Senate have both released their idea of budget game plan. It's got Big Ag written all over it.

While the Senate version is a little greener, largely due to the effectiveness of this fresh and nimble green-farm alliance, neither version will do much to bring real income or adequate environmental protection. Both budgets look designed to perpetuate failed farm policy and conveniently ignore increased concentration, wasteful overproduction and continued rural economic and environmental decay.

Emergency bailouts are still a wildcard with a special $61billion "Strategic" emergency fund set up by Congress for the military, and guess what? Agriculture.

In the next round, which may begin as early as next week, the Senate and the House meet in joint conference to hack out a final spending plan. What will this final version look like? Who knows. But stay tuned. Congress may fumble and hand over what's left of the family farm to Big Industrial Ag - that remains to be seen. In any event, it's a great time to speak up and see who's listening to your concerns and who needs to be voted out come next election. For new directions on the farm bill see http://www.familyfarmer.org/sections/next.html

2. HEY, WAIT A SECOND, WE VOTED FOR YOU

President Bush unveiled his agriculture budget last week and amazingly it penalizes the very people that put him in office - rural America. As Paul Krugman points out writing in the "Reckonings" section of the New York Times (see link below) even though the President lost the majority vote, it was the electoral college votes wielded by rural America that carried Bush to the White House.

Yet a close study of the Presidents budget recommendations shows that rural America will be the big budget loser. Incredibly, the overall ag budget, which is of course the mainstay of rural America, took a hefty 7% cut in the midst of the worst economic crisis since the great depression. Conservation programs which almost exclusively benefit rural America also took direct hits. More amazingly, the USDA's rural development program faces a whopping 12% cut.

Not everything in the Presidents ag budget took cuts. The trade liberalization arm, the Foreign Agricultural Service (FAS) got a nice 6% boost. Food inspection, increasingly important as international trade spreads diseases like Mad Cow and Foot and Mouth, got a modest 3% increase. Finally, the Risk Management Program, or crop insurance got the biggest boost of all with a monstrous 15% raise.

While farmers don't mind crop insurance support the program is sharply criticized because it eats up disproportionate chunk of the ag budget (2.2 billion annually) while bringing no real wealth to the farm sector. Moreover, the program hands over nearly one-fourth of its total budget ($500 million annually) to the urban insurance industry for "administration" with virtually no oversight and numerous reports of abuse.

The free market and tax cuts will not bring vitality to rural America. Rural residents know well that the so-called free market has been draining rural lifeblood for decades now. As for tax cuts, most of the beneficiaries of Bush's plan are in the big cities, not in the rural districts that voted for him. Only a few elite producers are making enough actual income to even pay federal income taxes. The rest are kept alive by the very federal programs that the president recommends cutting.

3. FARM BUREAU AND THE INSURANCE INDUSTRY

While people are just now discovering that Farm Bureau is in the banking industry, many have known for years the Farm Bureau "non-profit" trade organization is linked to an intricate web of "for profit" Farm Bureau insurance companies. The "relationship" between these two is very close and often blurred. Farm Bureau non-profits in some areas, for instance, might share an office building and both utilize the same personnel and leadership. The president of a state farm bureau, for example, is often on the board of directors of the insurance company and so on.

With regard to the handsomely subsidized federal crop insurance program, the farm bureau owns and controls about of one-fourth the companies approved by the USDA to provide coverage.

While the USDA will not release stats on how much Farm Bureau insurance companies have profited from the federal crop insurance program, the situation begs questions regarding conflict of interest. Should a non-profit trade organization afforded special tax breaks to provide service to members be allowed to manage companies that profit from doing business with those very members? When mutual leadership controls both entities will they act in the best interests of their members, or in the interest of their corporate shareholders?

To join over a hundred groups calling for an investigation into Farm Bureau leadership conflicts of interest go to http://www.defenders.org/rural3.html

To learn more about Farm Bureau and crop insurance visit the Rural Updates! Archives (July 9, 2000).

4. WHAT PEOPLE ARE SAYING

Just in case people believe that urban folks are oblivious to concerns about what food production is doing to families, food safety, and rural American environments, we are forwarding the following links. Two of these articles appeared in large urban newspapers and show that word is getting out about bad farm policy. The other appeared in a rural Agriculture journal and suggests a great way to improve it.

Fake Farm Bill
Editorial by Washington Post

Muddled in the Middle
New York Time OP-ED

The Conservation Security Act
Letter to Minnesota Agrinews

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