Myth and Fact on New Farm Law

June 17, 2002

The House Agriculture Committee has issued a publication titled "The Facts on U.S. Farm Policy," an attempt to dispel reports on the expense and impacts of the new law that the committee considers erroneous.

To the charge that U.S. farm policy "bilks taxpayers and busts the budget," the committee said U.S. farm policy costs pennies per meal and accounts for little more than one-half of 1% of the U.S. budget. "In fact, the 2002 farm bill costs less than the 1996 farm bill with emergency assistance," the committee maintains.

Responding to claims that federal farm policy helps big corporate agribusiness, not real farmers, the committee says "big corporate agribusiness actually opposes U.S. farm policy." And that policy helps "all American farm families because all farm families feel the sting of a world market that is not free or fair."

Another charge is that U.S. farm policy is nothing but corporate welfare benefiting only those receiving direct help. The committee statement says farm policy is important to national security, ensuring a safe, abundant, and affordable domestic food supply, and vital to a strong rural and urban economy, with the food and fiber industry creating 25 million jobs, producing $3.5 trillion in output, and accounting for 15% of U.S. gross domestic product (GDP).

U.S. farm policy fully complies with U.S. trade agreements, says the committee, "and with foreign tariffs on agricultural goods more than five times higher than U.S. tariffs, U.S. farm policy helps level the playing field so our farmers can compete in a world market that is not free or fair."

The new farm bill has aroused strong and bitter opposition from a number of foreign countries, as well as from domestic critics. Although Congress seldom pays attention to overseas criticism, the current denunciations of U.S. policy have the potential to complicate several different trade negotiations, including World Trade Organization talks that are aimed at reducing subsidies worldwide.