01/18/07 Fund Agriculture in 2007

Funding Agriculture in 2007. I'm Greg Martin with today's Line On Agriculture. In his State of the Union Address next week - President Bush is expected to list a balanced budget among his goals in an effort to call the Democrats' bluff on fiscal discipline. What will that mean for agriculture? A Farm Bureau economist predicts both parties will safeguard farm programs. Farm Bureau Senior Economist Terry Francl says history shows despite White House talk of deficits and balanced budgets - Congress has managed to come through for agriculture. FRANCL: Congress has managed to find the money to put together the kinds of programs they believe are important for both the agriculture sector and the consumer sector. Francl admits there will be some adjustments to make the upcoming farm bill more green and compliant with WTO rules - but he says he expects lawmakers will find ways to shift funds around if they come up against budget limits. FRANCL: Whether Congress is going to working within the budget baseline figures, I mean, basically sets the rules and to the extent there are times when its coming up against the rules or the money is tight there seems to always be a way to make some adjustment. Farm Bureau has called for farm bill funding comparable to the 2002 bill - and as Francl points out - mandatory or entitlement programs - like direct payments, LDPs and countercyclical payments - are more immune to budget limits than discretionary. FRANCL: Discretionary would be something like food aid that's going to be approve d every year or again as we get into some of the things on the conservation side, those are more discretionary things as opposed to the entitlement part. Francl says lawmakers will try to meet a budget limit - but much will depend on commodity prices in future years - which can't be predicted now. And as far as the President's call for a balanced budget. FRANCL: Well I think you have to take the administration and the spokespeople at their word that this is a matter of concern as with anything else, well it is a primary issue at this point. It is not the exclusion of everything else in the world and that's where adjustments come and things are a little bit different. While actual farm payments came in below those called for in the last farm bill - Francl says the safety net must be protected for times when prices are low. Francl says he's betting Democrats and Republicans will do that - as they have in the past. That's today's Line On Agriculture. I'm Greg Martin on the Northwest Ag Information Network.