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October 2005

U.S. Farm Policy Update
Media Summary

Welcome to American Farmland Trust's U.S. Farm Policy Media Summary. This bi-weekly publication will alternate with the U.S. Farm Policy Update and highlight key farm policy items seen in the media.

Drastic Cuts to Conservation; USTR Proposes Deep Cuts; Mainstream Agriculture Proposes Novel Reform; Brazil Seeks Sanctions

Two big stories dominate agriculture in Washington, DC. The budget reconciliation plan put forth by Sen. Saxby Chambliss (R-GA), chairman of the Senate Agriculture Committee, calls for drastic cuts to already under-funded conservation programs. Meanwhile, commodity subsidy programs, which are the center of World Trade Organization (WTO) debates, face only slight reductions. Agriculture Secretary Mike Johanns, in a speech that echoed many points American Farmland Trust (AFT) has been saying, called for significant change in U.S. farm policy. Following the speech, the Administration proposed to cut trade-distorting subsidies at talks in Zurich. While some mainstream agricultural groups, such as the Illinois Farm Bureau, proposed alternatives to the unpopular subsidy programs, other news articles pointed out the folly and effects of the current policies.

Budget Reconciliation Bill Includes Deep Cuts To Conservation, Could Derail WTO Talks
The Guardian explains that the reconciliation budget proposed by Congressional Republicans will make deep cuts to conservation programs while only reducing commodity supports—which are considered trade-distorting by the WTO—by 2.5 percent. A Western Farm Press article notes that various national commodity groups continue to resist changing the 2002 Farm Bill.

Sec. Johanns Tells Agriculture “The Farm Bill Must Be Different”
Speaking to the Washington, DC, commodity club, Agriculture Secretary Mike Johanns signaled the strength of the Administration’s resolve to fight for a new farm bill: “Soon, we must decide as a nation whether to embrace a new age of agriculture or continue relying on a policy structure that was conceived 75 years ago, when the face of agriculture was very different from what it is today.” See the U.S. Department of Agriculture transcript of Johanns’ remarks.

Administration Offers Dramatic Cuts in Subsidies at Zurich Talks
In a Monday news release, AFT congratulated Secretary Johanns and U.S. Trade Representative Rob Portman for their proposal to cut trade-distorting commodity supports by up to 60 percent in exchange for tariff reductions by other countries of 55-90 percent. For a summary of the U.S. proposal, see the USTR’s Web site. While this is a step in the right direction, it appears that the proposal will not dramatically reduce commodity subsidies.

Mainstream State Agriculture Groups Propose Novel Reforms
Illinois Farm Bureau’s Farm Week details a proposal to assist farmers, based on their revenue and not on the price of a commodity, which could result in “a more solid producer safety net,” yield significant savings for the federal budget and help the United States comply with demands from the WTO and trading partners to dismantle its current subsidy system.

Brazil Seeks To Impose Over $1 Billion in Trade Sanctions Against the U.S.
Just as U.S. Deputy Secretary of State (and former U.S. trade representative) Robert Zoellick arrived in Brazil last week for good-will talks, Brazil delivered a request to impose over $1 billion in trade sanctions against the United States in its long-standing dispute over payments to U.S. cotton producers. The request will be discussed the week of October 18th. Zoellick countered that Brazil should think carefully about the implications, saying their actions could incite a trade war.


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