Panel Advises Tighter Farm Subsidy Rules
The federal panel created by Congress to examine farm subsidy payment limits recently recommended tightening eligibility rules for payments and tying payments to individual farmers rather than corporate entities.
Commission members viewed the recommendations as important steps to simplify the crop subsidy system. However, the 10-member commission disagreed on how to treat revenue that U.S. grain, cotton and soybean growers get from price supports.
One faction wanted tighter rules blocking producers from using generic commodity certificates and price support loan forfeitures to evade the subsidy cap, while other commission members wanted no change in the current rules.
The report should provide ample fodder for a congressional debate over lowering the payment limit. Sen. Charles Grassley, an Iowa Republican, is expected to seek a vote on a "hard cap" in the range of $275,000 to $300,000.
Grassley's legislation would end the use of multiple "entities" to double subsidy collections and bar the use of generic certificates and loan forfeitures to exceed the payment limit.
Editors note: Richard Brock, The Corn and Soybean Digest's Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.
To see more market perspectives, visit Brock's Web site at www.brockreport.com.