The next farm bill is seen as critical for many farm state economies, especially those where farmers have developed their operations on the basis of a steady flow of government dollars. Turning down the USDA spigot will have an impact on some farming operations and local farm economies that are dependent upon the production of some of the historically more subsidized crops.
The emerging farm bill ultimately will define how government dollars are spent. In the meantime, the White House is fashioning a USDA budget that anticipates sizable fiscal demand.
The unveiling of the administration's budget this week set the stage for a showdown with Senate Democrats over a 10-year agriculture funding package.
The president's budget fulfills a promise made last year to support $73.5 billion in new spending over the next decade. .The White House wants that money distributed evenly over a 10-year period. But a Democrat-backed farm bill pending in the Senate would spend an estimated $44 billion through 2007, leaving about $30 billion for the remaining five years.
Ann Veneman, Secretary of Agriculture: "When you talk about the upfront loading, there is a concern ... we believe that spending ought to be spread over the 10-year period as evenly as possible to preserve a consistent baseline and some certainty for our farmers and ranchers."
A farm bill passed by the Republican-controlled House is more in line with administration thinking, spending $34.6 billion over the first five years.
The $73.5 billion represents a 78 percent increase over the spending required by existing farm programs, which expire September 30th. In the short term, Veneman expects there either will be a farm bill that affects 2002 crops or a supplemental appropriation for the coming crop year. Either way, there will be additional spending for farmers in 2002.
The administration's budget sets aside $4.2 billion for new farm spending this year and $7.3 billion in 2003. Beyond that, Veneman said the annual spending levels depend largely on congressional action on the farm bill.