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NY Times castigates all parties in 'Politics of Drought' editorial (Friday, Sept. 20, 2002 -- CropChoice news) -- This is provided courtesy of the Agribusiness Examiner.
NEW YORK TIMES EDITORIAL: Many of America's farmers and ranchers are in
a bad way. Some parts of the country are now enduring a fifth
consecutive year of drought. Yields are dismal, families desperate. That
said, it was mainly politics, not compassion, that drove the Senate last
week to approve nearly $6 billion in emergency drought relief, thereby
defying President Bush and deepening Washington's budget woes. Budget
experts say that with only modest adjustments, the Senate could have
easily extracted the $6 billion in drought relief from the extravagant
$180 billion farm-subsidy bill it approved last spring. But that would
have required trimming some of the bill's lavish entitlements, a step
few senators were prepared to take.
As the midterm elections draw near, it is becoming increasingly clear
that control of the Senate, where the Democrats have a one-vote margin,
may hinge on what happens in a few closely contested, sparsely populated
states where regional concerns outweigh big issues like the economy,
taxes, corporate malfeasance and even Iraq. A case in point is this
summer's forest fires, another natural disaster that, like drought, has
created both personal hardship and bad public policy. Western and
Plains-state senators are falling all over each other to see who can cut
down the most trees in the name of fire control.
But nothing quite matches farm policy for election-year mischief. Back
when the ten-year omnibus farm bill was passed last spring --- a bill,
incidentally, that represented a staggering increase over the money the
federal government had already been spending on farm programs ---Senate
leaders said there would be no further need for "ad hoc" disaster
payments. But as the drought worsened and the election neared, these
promises shriveled like autumn corn.
Not surprisingly, farm-state senators in tight races led the debate in
favor of aid. The Democrats included Paul Wellstone of Minnesota, Tim
Johnson of South Dakota, Jean Carnahan of Missouri and Tom Harkin of
Iowa, a co-sponsor with the majority leader, Tom Daschle, of last
spring's gargantuan bill. Republicans like Wayne Allard of Colorado and
Tim Hutchinson of Arkansas, equally worried about retaining their seats,
joined the chorus.
The Bush administration promptly complained about the bill's budgetary
impact. One prominent Republican senator who is not facing re-election
this fall, Phil Gramm of Texas, said he did not want to hear any more
lectures from the Democrats about deficit spending, and he had a point.
Mr. Daschle's home state, South Dakota, has been the epicenter of farm
bill politics, and he probably bears more responsibility than any other
legislator for this unconscionable overspending.
Nevertheless, Mr. Bush cannot escape all the blame. A little more than a
year ago, when Congress first took up the farm bill, the president
promised a different course. Lavish subsidies, he argued, stimulate
excess production, hurt the environment and benefit only a select group
of big growers at enormous public expense.
As it happened, there was a reform vehicle readily at hand that would
have made the omnibus farm bill fairer and cheaper. A bill sponsored by
Senator Richard Lugar, Republican of Indiana, would have helped farmers
buy generous insurance against economic downturns of all kinds. The
program would have covered all farmers, big and small, including
livestock producers, who are excluded from traditional commodity payment
programs but whose sorry plight is one of the main reasons why Congress
is now seeking emergency relief.
But Mr. Bush did not lift a finger on behalf of the Lugar bill, and in
the end the old and manifestly inequitable price-support system was
allowed to prevail. In effect, by not vetoing the farm bill or working
harder for an alterative, Mr. Bush allowed Congress to put politics
ahead of principle and sound policy. He should not be surprised that the
Senate is trying to do so again.
USDA REPORTS DROUGHT DAMAGE WORSENS
AS SOME FARM STATES SLIPPING INTO RECESSION
SCOTT KILMAN, THE WALL STREET JOURNAL:The Agriculture Department raised
its tally of drought damage to U.S. crops as evidence mounts that some
farm states are slipping into recession.
The government's monthly crop report showed that farmers abandoned
nearly 690,000 acres during August. While rains have returned in recent
weeks to some parts of the Plains, triggering a race by farmers in
Kansas and Nebraska to plant winter wheat, the drought is intensifying
in the eastern half of the farm belt.
Ohio farmers are expected to harvest 27% less corn than last year, and
19% fewer bushels of soybeans. The department said it expects the
Indiana corn crop to shrink 29% from last year.
The department's forecast of total U.S. crop production changed
relatively little from a month ago, when the government first slashed
its outlook to account for drought invading the Midwest from the East
and the West. That is largely because crop prospects continued to
improve in a few states such as Iowa and Minnesota, which have escaped
the drought. Iowa is on track to harvest its third-biggest corn crop.
Based on September 1 conditions, the department said it expects U.S.
farmers to harvest 8.85 billion bushels of corn, down less than 1% from
its August outlook but down seven percent from last year. U.S. soybean
farmers are expected to harvest 2.66 billion bushels, up one percent
from August but down eight percent from last year.
The farm economy usually bounces back quickly from drought, helped by a
corresponding jump in crop prices and disaster aid from Congress. True
to form, the price of a bushel of wheat has soared 64% since March.
Prices of corn and soybeans are up 46% and 38%, respectively. Congress
is preparing a $5.9 billion disaster aid package.
But this drought --- which has dragged on for three years in parts of
the Plains --- will likely dent the economy of farm towns there for
several years.
Several rivers, such as the Republican and North Platte, that supply
water to farmers are so low they likely will need years to return to
normal, limiting supplies for irrigation. Ranges in parts of Nebraska,
Kansas, Wyoming and Colorado are so dry it also will take years before
the grass can support the same number of cattle as before the drought.
"This drought has gone on for so long here that we will feel it for
years," said Martin Albright, a Kansas State University economist who
estimates ranchers and farmers in the state are losing nearly $1.4
billion in income this year.
Some small-town tractor dealers, fertilizer makers and grain elevators
are laying off employees or otherwise cutting costs as farmers spend
less money in their stores. Farmco Inc., a Tribune, Kansas, grain
cooperative, has seen its revenue plunge 70% so far this year because a
paltry wheat harvest left it with little grain to handle.
"In the last month, things slowed considerably," said Orville Kaschke, a
Deere & Co. implement dealer in Hershey, Nebraska.
Kelly Sittner, president of the Hershey State Bank, is worried the cow
population in the area will drop 25% this year --- a decline that would
take ranchers years to repair. "The pastures look like cardboard," said
Mr. Sittner, who estimates that 15% of his farmer-borrowers are in such
poor financial condition they probably won't qualify for loans from his
bank next year.
Ernest Goss, an economist at Creighton University in Omaha, Nebraska,
said his survey of 1,100 central U.S. businesses shows the drought is
threatening to tip some Plains states back into the recession they
emerged from last winter.
Prof. Goss's leading-indicators index for Nebraska, for example, has
dropped three consecutive months, including August. The eight-year-old
Mid-American Business Conditions index, which tracks new orders,
production and employment, among other things, also shows slowing
business activity in Kansas and the Dakotas. "The drought is giving the
Plains states a cold and the fear is it could turn into pneumonia," he
said.
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