GOVERNMENT SUPPORT FOR FARMERS IN SOME OF THE WORLD'S WEALTHIEST NATIONS IS NOTHING NEW. IN FACT, IT'S INCREASING. CONGRESS ALREADY HAS PASSED LEGISLATION TO PROVIDE PAYMENTS TO FARMERS FOR A 2000 CROP THAT'S BARELY IN THE GROUND. AND WHILE FEW BEGRUDGE FARMERS COMPENSATION FOR ANEMIC CROP PRICES, THERE ARE THOSE WHO SAY SUCH LARGESSE COMES AT A COST.
THE STUDY WAS DONE BY THE ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMENT, A GROUP OF 29 COUNTRIES THAT USES DATA TRACKED BY O-E-C-D AS A BASIS FOR POLICY DISCUSSIONS ON TRADE, THE ENVIRONMENT AND AGRICULTURE.
THE O-E-C-D STUDY FOUND PRICE SUPPORTS AND PAYMENTS BASED ON PRODUCTION ACCOUNTED FOR ABOUT 75 PERCENT OF THE GOVERNMENT AID. BUT THE ORGANIZATION SAID A NUMBER OF AD HOC EMERGENCY PACKAGES, INTENDED TO COMPENSATE FARMERS FOR LOW COMMODITY PRICES, COULD ALTER FUTURE PRODUCTION DECISIONS, ENDANGER EFFORTS TO LIBERALIZE FARM TRADE AND STALL IMPLEMENTATION OF FARM POLICY REFORM.
THE STUDY CONCLUDED THE VARIETY OF WAYS IN WHICH EMERGENCY FARM AID PACKAGES WERE EMPLOYED WERE "INCONSISTENT WITH THE LONGER-TERM PRINCIPLES OF AGRICULTURAL POLICY REFORM" ADVOCATED BY MANY O-E-C-D NATIONS.
THE REPORT SAID ALL O-E-C-D NATIONS EXCEPT AUSTRALIA AND TURKEY RAISED LEVELS OF FARM SUPPORT IN 1999. KOREA WAS THE BIGGEST SPENDER, WITH AID TO FARMERS WORTH 74 PERCENT OF THE COUNTRY'S TOTAL FARM OUTPUT. NEW ZEALAND, AT 2 PERCENT, CONTINUED TO PROVIDE THE LOWEST LEVEL OF SUPPORT.
IN THE U.S., THE RATE OF FARM SUPPORT INCREASED FROM 22 PERCENT IN 1998 TO 24 PERCENT LAST YEAR, DUE ALMOST ENTIRELY TO EMERGENCY AID DELIVERED BY CONGRESS.
ON A COMMODITY BASIS, RICE, MILK AND SUGAR REMAIN THE PRODUCTS WITH THE HIGHEST LEVELS OF SUPPORT. WOOL, POULTRY AND EGGS RECEIVED RELATIVELY LITTLE.
ON THE HEELS OF THE O-E-C-D REPORT COMES NEWS FROM WASHINGTON THAT U.S. DAIRY FARMERS COULD RECEIVE UP TO $17-THOUSAND DOLLARS ANNUALLY TO COMPENSATE FOR FALLING MILK PRICES. UNDER BIPARTISAN LEGISLATION INTRODUCED THIS WEEK, THE $450-MILLION DOLLAR PROGRAM WOULD PROVIDE WHAT BACKERS CALL A "SAFETY NET" FOR DAIRY FARMERS.
THE PAYMENTS WOULD TRIGGER IF FLUID MILK PRICES DROP BELOW $12.50 A HUNDREDWEIGHT. FARMERS COULD RECEIVE PAYMENTS FOR UP TO THE FIRST 2.6-MILLION POUNDS OF MILK THEY MARKET.