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USDA Officials Testify in Senate Hearing on Conservation Security Program

posted on May 14, 2004

Hello, I'm Mark Pearson.

It's one of the government's most closely watched economic barometers. But for months now, inflation has been almost an afterthought. No more.

In the first four months of this year, consumer prices have risen 4.4 percent. That compares with a 1.9 percent increase for all of last year. Even excluding volatile food and energy costs, inflation is up this year by 3 percent.

In other less-than-encouraging news, wholesale prices last month shot up by their largest margin in a year, retail sales declined, and the trade deficit in March swelled to an all-time high.

The economic news in farm country appears more upbeat. In fact, government numbers released this week show farm program payments for 2004 and 2005 should be about $5 billion below previous estimates. That's because commodity prices have been so good lately, that so-called countercyclical payments used to prop up farm income will not be needed.

For Washington policy-makers, that's shifted the focus of farm programs to other areas, like the Conservation Security Program, or CSP.

USDA Officials Testify in Senate Hearing on Conservation Security Program Authorized under the 2002 Farm Bill, CSP is the first federal agricultural conservation program to provide economic incentives for conservation efforts on working farmland.

1.8 million farmers and ranchers potentially are eligible for the $41 million dollars budgeted for CSP in fiscal year 2004. But last week, when the Bush administration announced proposed sign-up plans featuring a rotation of America's waterways, USDA said no more than 5,000 producers would be entitled to receive payments this year.

Senator Tom Harkin, D-Iowa: "It seems to me that what you're doing is, you're going to pick a few people in a watershed and, selected watersheds, and then that watershed will not be eligible for eight years..."

Senator Tom Harkin of Iowa, the ranking Democrat on the Senate Agriculture Committee, and the author of CSP, sharply criticized the Bush administration's implementation of the program.

According to Harkin, USDA is too narrowly focused on watersheds, has established rules that favor farmers in some regions over others and has drastically curtailed financial incentives. But USDA officials claim there isn't enough money to pay everyone who would be eligible.

Bruce Knight, Chief, National Resources Conservation Service: "It is important to note that especially in this first year, we are in a zero-sum game. So the more generous the program implementation is per contract, the fewer total contracts we are able to do under the cap we currently have to operate under."

Lawmakers weren't the only ones expressing their displeasure with USDA's proposed guidelines for the CSP program.

Francis Thicke, Sustainable Agriculture Coalition: "I think what I see here is actually the long arm of the Office of Management and Budget of the White House. So we can talk to Chief Knight 'till we're blue in the face but it really isn't going to make a difference as long as it's a political process."

Tags: agriculture conservation news security USDA