Harkin: Subsidies may be cut to pay for farm bill

JANUARY 18TH, 2008 | Harkin for Senate

By PHILIP BRASHER Register Washington Bureau January 18, 2008

Washington, D.C. – Some crop subsidies could be cut as lawmakers search for ways to pay for a new farm bill, Sen. Tom Harkin, D-Ia., said Thursday.

“As far as I’m concerned, direct payments are still on the table,” he said, referring to the more than $5 billion in fixed annual payments that grain and cotton farmers receive.

Iowa farmers and landowners collect about $500 million a year in such payments.

The House and Senate resisted reducing those subsidies in writing their versions of the farm bill and got money instead from increasing corporate tax revenues, prompting a White House veto threat. Advertisement

Harkin will be chairman of a House-Senate panel that will be charged with writing a compromise version of the bill.

Charles Conner, the acting agriculture secretary, has said that the administration would not approve a farm bill funded by new taxes. Last year, President Bush fought off plans by Democrats to include new taxes in energy and children’s health care bills.

Harkin, who is chairman of the Senate agriculture committee, ruled out additional cuts in payments to crop insurance companies and agents, an area that Conner has suggested for further reductions.

“I hope that as we go down the road we’ll see some flexibility” on the tax issue, Harkin said.

Some critics of farm programs have argued that the fixed farm payments aren’t justified at a time when prices for corn, soybeans and other commodities are at record levels. Harkin initially favored reducing the payments but couldn’t get support for the idea from fellow senators. The American Farm Bureau Federation recently reiterated its opposition to reducing the subsidies.

But given the high commodity prices, “the issue of direct payments becomes even more important,” Harkin said.

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