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Published October 17, 2008, 12:00 AM

Ag payments divide McCain, Obama

ST. PAUL — John McCain was talking to reporters on his Straight Talk Express bus earlier this year, speeding past Minnesota corn fields while saying the federal government has no business subsidizing farmers who grow that crop, or any other.

By: DON DAVIS St. Paul Capitol Bureau, DL-Online

ST. PAUL — John McCain was talking to reporters on his Straight Talk Express bus earlier this year, speeding past Minnesota corn fields while saying the federal government has no business subsidizing farmers who grow that crop, or any other.

He also said he opposes tariffs designed to slow sugar and other agriculture imports.

“Let the market work,” the Republican presidential candidate said.

McCain’s Democratic opponent, Barack Obama, strongly supports the new farm bill, which continues federal farm policies that include a variety of farmer subsidies. He calls it a safety net for farmers who otherwise could face financial disaster.

Much of Obama’s emphasis has been on ending federal aid to large farms, while continuing help for the small family farmer.

“Most importantly, Barack Obama and Joe Biden will close the loopholes that allow mega farms to get around the (profit) limits by subdividing their operations into multiple paper corporations,” an Obama campaign paper says. “They will take immediate action to close the loophole by proposing regulations to limit payments to active farmers who work the land, plus landlords who rent to active farmers.”

Obama supporters say that since he represents Illinois farmers, and grew up in Kansas, he understands agriculture issues better than his Arizona rival.

National Farm Bureau President Bob Stallman wrote in a recent column that the presidential choice is not clear-cut for farmers:

“Both Sens. McCain and Obama represent what I call a mixed bag of support for agricultural issues important to Farm Bureau,” he said. “For example, Sen. Obama supports the renewable fuels standard and the farm bill, whereas Sen. McCain champions offshore drilling and many of the Farm Bureau-supported tax reform provisions.”

The presidential candidates have said little about agriculture on the campaign trail, so specifics of their farm policies are lacking.

Over the past several months, their campaigns turned down repeated requests to interview the candidates about rural issues. The campaigns also did not answer a series of written rural-issues questions. And farm and ranch advisors often said they could not speak for their candidates on specific issues.

The biggest, and most publicized, part of the ag debate is about the 2008 farm bill, which sets federal farm policy for five years. McCain said he supported President Bush’s veto of it, while Obama liked the bill.

Prime among farm bill disagreements is continuation of federal payments directly to many farmers, designed to allow them to make money in a market where other countries’ farmers receive aid from their governments. Subsidies also are supposed to keep consumer prices down as well as keeping farmers afloat when they are hit by natural disasters or low prices.

“If you take away that safety net…you are talking about a fundamental case of food security,” said David Lazarus, director of the Obama campaign’s rural policy.

A top McCain ag advisor, former Deputy Agriculture Secretary Jim Moseley, said the candidate does not want automatic payments to continue. A new look is needed for the farmer safety net, he said, but that new look still needs to be designed.

Moseley’s suggestion, which he said McCain accepted, is to bring together ag policy experts to conduct in-depth research to find the best alternative.

Democrats criticize McCain for wanting to further study farm policy when Congress just spent 18 months drafting the new farm bill. But Moseley said that recent economic problems — that include soaring farmer costs such as for fertilizer and fuel — change the situation dramatically.

“The farm bill that we just passed is not going to protect farmers at all,” Moseley said. “Events have overtaken the farm bill.”

What was farmer enthusiasm has turned into anxiety, said Moseley, an Indiana hog producer.

It appears McCain favors an expanded form of the current crop insurance program. Such a program could be turned into a plan to guarantee farmers’ income regardless of the threat — natural disaster, soaring input costs, etc.

There are some obvious things McCain favors, even if specifics are not available.

“He would lean toward things like tax credits, tax policy, some mechanism of insurance that covers price and yield together,” Moseley said.

In some ways, it is not all that different from Obama.

“We have to find ways to help farmers through the tax code,” U.S. Sen. Dick Durbin, D-Ill., said about farmers’ high input costs. “You have farmers who have (crop sales) prices that are soft and costs that are hard.”

Durbin introduced a bill to make a broad insurance program the key part of the federal government’s farmer safety net, and Obama voted for it. It failed, but Durbin, the Obama campaign’s chairman, said he thought Obama would support the effort if elected president.

In the past, Lazarus said, disasters like floods meant farmers needed to wait for Congress to act. The new farm legislation streamlines the process by setting up a permanent disaster program that does not require congressional action.

The 2002 farm bill, used as the basis for the 2008 version, “is a success story,” Lazarus said.

McCain emphasizes foreign trade as a way for farmers to make more money. He promises to work with both the agriculture community and international leaders to improve trade, and to enforce existing trade agreements so other countries do not get a better deal than American farmers.

Obama also looks to trade, but takes a different stance. In comments given to the Farm Bureau, Obama said that he supports “full funding to vital market promotion programs that enhance our access to important international markets.”

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