WASHINGTON (B)--The House Agriculture Committee decided Wednesday to go against the wishes of its chairman by limiting a aid package to help farmers with their 2001 crops to $5.5 billion.
Chairman Larry Combest, R-Texas, started out the hearing by proposing a $6.5 billion aid package, which would have split spending between fiscal 2001 and 2002.
Mitchell Daniels, the White House's Office of Management and Budget director, had recently urged that the package be limited--a call termed "short-sighted" and "out of touch" by Combest.
Ironically, it was a Democrat, Rep. Charles Stenholm, Texas, who spearheaded the movement to trim the package, all of which must be spent in fiscal 2001, which ends Sept. 30.
Stenholm told lawmakers that the $5.5 billion is the "minimum needed, but the maximum affordable" under budget constraints and later told BridgeNews that he agreed with much of Daniels' letter that asked the House Agriculture Committee not to add money on to the aid package.
The panel's decision Wednesday not to do so, according to Stenholm, should make it clear there will be more belt-tightening when it comes to farm subsidies as negotiations begin in earnest on the next farm bill in July.
Mitchell in his letter last week to Combest stressed that "in the long run, we need to decrease distortions the federal government creates in agriculture markets."
By vowing to end ad hoc bail outs to farmers, Combest seemed to agree with that sentiment. However, he stressed it was necessary to increase what he called "the last of the temporary assistance packages" before lawmakers "move next month to report out new farm legislation that can provide sufficient, long-term, predictable farm programs that are better able to meet the demands of the current situation."
Congress has provided about $24 billion in emergency bailouts over the past three years on an ad hoc basis.
Combest went on to say, "After carefully reviewing the assistance provided in previous years and evaluating the severity of this year's financial situation, I have come to the conclusion that the $5.5 billion provided in (fiscal) 2001 is insufficient...Restricting spending to (fiscal) 2001 money would prevent the committee from addressing properly the needs of dairy and sugar producers.
"We would not be able to provide loan deficiency payment eligibility to producers on non-contract farms who would otherwise receive no assistance at all," Combest said. "Nor would we be able to provide fruit and vegetable producers assistance in drawing down surplus stocks throughout the coming marketing season."
Instead, the panel approved the amendment proposed by Stenholm and Rep. John Boehner, R-Ohio, which completely replaced Combests' bill and limited spending to this fiscal year with a Sept. 30 deadline.
"If we start spending money now (for fiscal 2002) we're .
opening the door to who knows what," Boehner said. "People are already lining up to add money for 2002. One billion dollars may not seem like much, but it leads to big problems. We need to show some restraint."
Rep. Ron Kind, D-Wis., agreed and predicted Wednesday's hearing would become a "bidding war" to add more money if the Stenholm-Boehner amendment was not approved.
The bulk of the bill approved recently by the House Agriculture Committee provides $4.6 billion for supplemental cash payments through the Agricultural Marketing Transition Act.
Smaller amounts, such as $423 million for oilseed producers, $54.2 million for peanut farmers, $84.7 million for cotton producers, $169 million for "specialty crops" and others make up the rest of the bill.