US Farm Bill waning

30 Jan, 2002 10:00 PM

Federal President George W. Bush's opposition to the protections US Farm Bill appears to be waning, with the US head of state declaring his support for the bill to farmers last week.

At times issuing conflicting messages on world trade, President Bush told farmers on a three day tour through the US "heartland" that the farm economy was one of the three most important drivers of the US economy providing $1.3 trillion of gross domestic product in the year 2000, and employing more than 24 million people.

As a result, a good Farm Bill, which was "generous" was paramount, he said.

"There will be ample money in there to meet the (farmers') needs, and it's money that will fit into our budget," he said.

"A farm bill must provide a safety net for the American farmer."

However he added that it should not encourage overproduction thereby depressing prices, and should support the commitment to freed trade.

The latter comments were encouraging for Australian trade officials, who will view closely whether the administration's actions match President Bush's mantra when the final Farm Bill is passed, probably in the next couple of months.

Mr Bush also reconfirmed the United States' commitment to free trade, but then gave ammunition to those countries resisting attempts to open up world agricultural markets when he said: "It's a national security interest to be self-sufficient in food. Imagine if we have to rely upon somebody else to provide us food - it would be a problem. I would hate to be the President of a country that has import a lot of food."

Australia's trade minister Mark Vaile said the US still remained a large importer of food, despite Mr Bush's comments

"It was obviously targeted at a specific audience," Mr Vaile said. "America is a significant importer of all sorts of products."

In his speech to farmers President Bush also declared "the American farmer farmer is more efficient, and can raise more crop than anybody, anywhere in the world".

That begged the question: Why do they need more subsidies then?

"If American farmers are so efficient, why are they lobbying so hard for handouts and free kicks from Uncle Sam?" NFF trade and deputy director Lyall Howard said.

"American farmers are not the most efficient in the world, but they can be if they throw off the chains of protectionism. Subsidies are driving up farm costs, such as land rents and input costs, and undermining their efficiency."

Yet the US farmers continue to campaign for extra government support, claiming recently it was "imperative that we have a new farm bill within weeks, not months."

That's despite an 18 per cent increase in net cash farm income, excluding government payments, since 1999.

But the American Farm Bureau argues that a $10b drop in government support would cut farm income by 15-20pc, causing big concerns for farmers.

As a result it wants the new farm bill approved as soon as possible.



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