10/31/07 Flinchbaugh likes protecting revenue over price

Farm and Ranch October 31, 2007 Farm policy expert Dr. Barry Flinchbaugh, who will be a speaker at next month's Pacific Northwest Grains Conference in Spokane, says the new farm bill will contain one significant change from past bills; the option to substitute target revenue for target price. The Kansas State economist says the idea was devised several years ago. Flinchbaugh: "I chaired a commission that came out of the 96 Farm Bill and we reported in the year 2000 and we suggested that we have a counter cyclical revenue program rather than a counter cyclical price program. It took seven years but we have finally got that in both versions. It will come out of conference. We will have some battles over the details, but the principle is established." Flinchbaugh says the current counter-cyclical payment program is backwards. Flinchbaugh: "We have a bumper crop across the country. We have something to sell so we will make some money. But price is likely to be below the target so we get a payment. Now we have record drought across the country we are in deep trouble. If you don't have any to sell price is insignificant. But here we are. We have a drought across the county. Nothing to sell but the price is high and we don't get a payment. It's backwards." So Flinchbaugh sees the revenue option as a much stronger safety net. I'm Bob Hoff and that's the Northwest Farm and Ranch Report on the Northwest Ag Information Network.