Sen. Chuck Grassley today scored a major victory for family farmers when the Senate voted in support of his amendment to limit farm subsidies and target assistance to small and mid-sized farming operations.
"Today's vote is a huge victory for family farmers," said Grassley. "Capping farm payments will restore integrity to farm programs. Taxpayers can now have confidence that farm assistance will be targeted to those who need it the most. Today's action also sends a message that we will no longer tolerate large corporate farms reaping most of the benefits of federal farm payments."
Grassley offered his payment limitations amendment to the farm bill with Sen. Byron Dorgan of N.D. The measure limits direct and counter-cyclical payments to $75,000 and establishes a combined payment limitation of $275,000 for husband and wife. The provision also closes loopholes that allow individuals to evade the limitations and receive multiple payments.
The farm bill reported out of the Senate Agriculture Committee contained a payment limitation of $500,000 per farmer and made no changes to the law regarding generic certificates. Grassley said high payment limitations put pressure on rents and land prices and encourage overproduction.
"Such a sky-high payment limit accelerates the ability of large operators to grow bigger, and it squeezes out chances for first-time farmers who are trying to get started," Grassley said. "High payment limits also erode public confidence in farm programs because 10 percent of the farmers get 60 percent of the subsidy payments."
The Grassley/Dorgan amendment will provide $1.3 billion in savings over 10 years that will be divided among the food stamp program, agriculture research, a beginner farmer program and crop insurance. Grassley said the large share of savings applied to the food stamp program will increase food stamp spending by $810 million over 10 years.
In addition, the Grassley/Dorgan amendment would help farmers who were not included in the 1996 farm bill receive loan deficiency payments. The amendment will provide a one-year extension of a provision in the Agricultural Risk Protection Act of 2000 that furnished LDP's to farmers not participating in the 1996 farm bill. In Iowa, there are 6,200 farms that could be eligible to take advantage of these loan deficiency payments. The amendment also extends LDP eligibility to farmers who have lost beneficial interest in their commodity.
An effort to table and defeat the Grassley/Dorgan amendment was rejected by a vote of 66 to 31. The amendment was endorsed by 35 farm groups and other organizations, including the Center for Rural Affairs and the National Family Farm Coalition.