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Baucus meets with Eastern Montana farmers

Baucus meets with Eastern Montana farmers

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FORSYTH — Farmers should start thinking about what subsidies they can live without, Sen. Max Baucus said, warning of cuts in the next farm bill.

The Montana Democrat, speaking Monday to farmers in Forsyth and Miles City, called farm bill cuts inevitable and encouraged producers to contact his office to talk about what they can do without. The challenge, Baucus said, will be making sure the cuts don’t harm Montana’s bottom line.

“Agriculture is still our largest industry by far,” Baucus said. “Half our economy is tied to it, so we better make sure it stays strong.”

The senator said he will focus on ensuring that the nation’s budget isn’t balanced on the backs of rural states, although cuts were certain. The last farm bill, passed in 2008, cost roughly $289 billion, although two-thirds of its spending went to public nutrition programs, not farms.

Crafting the bill

Serious crafting of the next farm bill is probably still a year off, Baucus said, but talk about what might be cut is already taking place.

House Agriculture Chairman Frank Lucas, R-Okla., has already suggested cutting the $5 billion conservation reserve enhancement program, which pays farmers not to plant on marginal crop land. About 32 million acres have been idled nationally.

Montana farmers collected $105 million from the program in 2009, according to the Environmental Working Group farm subsidy database, ranking Montana in the top six recipients.

There’s also talk of cutting the direct-payment program, which is given to grain, soybean, cotton, rice, peanut and oilseed farmers every year regardless of need. In 2009, Montana farmers received $95.7 million in direct payments, the 18th most of all states, according to EWG.

Farmers argue that the money helps them deal with unexpected challenges, such as bad weather or rising fuel and fertilizer costs.

In Forsyth, the 30 constituents meeting with Baucus in the basement of the public library said any cuts need to be thoughtful to avoid undue harm.

Farm subsidies were established after the broad-scale farm failures of the 1930s as a way of preventing financial disaster not only for farmers but also for the agriculture banks that lend them money. But other programs have been added to improve land and energy conservation, among other things.

‘Safety net’

Not all of those add-on programs are viewed as “safety net” programs for farmers, but they can help farmers cut costs by working smarter. One of those creations is the Environmental Quality Incentives Program, or EQIP, said Darrell Grogan, president of First State Bank in Forsyth. EQIP helps farmers save fertilizer and water and ultimately drives down their business costs, Grogan said.

“There still needs to be some sort of basic safety net, but after the safety net, that’s a good program,” Grogan said.

Farmer Don Steinbeisser said he didn’t want to see small-cost items, such as the federal sugar program, cut from the bill. The program isn’t a subsidy but rather a method of regulating how much foreign sugar flows into the U.S. market, based on the ability of American farmers to meet domestic demand.

Sugar producers are in a near-endless battle with food and beverage companies over how much foreign sugar should be allowed to come into the country. The sugar program is the great equalizer.

After the meeting, Steinbeisser said his other concern is agriculture research funding, much of which is delivered to farm science programs at universities where the federal government is the main source of funding.

Farmer Floyd Dahlman said farm programs need to be more manageable. He was particularly frustrated with the 2008 Supplemental Revenue Assistance Payments Program, also known as SURE.

The SURE program was crafted after Hurricane Katrina as the federal government rolled out better ways to respond to natural disaster.

Baucus was a major advocate of SURE because it was intended to get farmers disaster relief in a hurry. In some instances, they had waited years for federal assistance after a natural disaster.

But SURE turned into a mountain of paperwork for farmers, Dahlman said. In many cases, farmers who needed the program couldn’t get the computer software required to fill it out.

“The only thing sure about SURE is that it’s unsure,” Dahlman said.

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