Could conservation programs receive greater funding than commodity programs in the 2007 Farm Bill? Should conservation programs receive greater funding than commodity programs in the 2007 Farm Bill? Will conservation programs receive greater funding than commodity programs in the 2007 Farm Bill? You can play word games until the legislation is signed, but what are the implications of conservation programs replacing commodity programs for the bulk of the dollars that go into the next Farm Bill?

Agricultural Economist Brent Sohngen at Ohio State University believes conservation funding will average $5 billion per year over the life of the 2007 Farm Bill. The 1985 Farm Bill and Agriculture Secretary John Block provided the Conservation Reserve Program. Since that time, Farm Bill funding for conservation and other environmental programs has grown. The current legislation pays out about 13% of its funds for conservation. So what makes Sohngen believe that percentage will increase?

1) World Trade Organization negotiations will have a lot of impact on the next Farm Bill, and US negotiators are fighting hard for unlimited payments to farmers that are related to conservation, which is strongly endorsed in Europe and acceptable to the developing nations.
2) For the past 20 years, the CRP program has been popular, and sister programs like EQIP also have strong support from agriculture, as seen by the quantity of applicants for funding.
3) States want the federal government to expand conservation programs, because their budgets are strained by requirements of the Clean Water Act. Sohngen says states have little incentive for development of their own conservation programs and see the Farm Bill as the means to meet water quality standards.

Sohngen says, “Thus, pressure from the WTO and pressure from states, combined with the success the Natural Resource Conservation Service has shown in allocating current conservation funds to farmers, will lead to an expansion of farm bill conservation programs. This expansion will occur even if overall farm bill subsidy programs decline.”

What makes him think that? He says, “The primary constituency for farm bill conservation programs is farmers. The future farm bill, however, has a broader constituency – the American people. This constituency has different values than farmers, and wants different things than farmers from conservation programs. Conservation programs need to be based on these values in order to maintain political viability in the long-run. Moving USDA to implement conservation programs that focus first on benefits to society and second on providing money to farmers is the single largest challenge that will be faced in the new farm bill.”

Supporting Sohngen’s analysis of WTO forces supporting increased conservation spending is Ag Policy Specialist Robert Thompson at the University of Illinois, who says, “In the Doha Round of trade negotiations, payments for conservation and environmental programs that are not linked to the production of any specific commodity would be categorized in the Green Box. European farm groups, who foresee lower traditional farm program benefits, would like to increase direct payments to underwrite the cost of soil conservation, protection of the landscape, and investments in other measures beneficial to the environment, as well as in rural development. It is likely, therefore, that an agreement would be easily achieved with the European Union for these kinds of payments to be exempted from any “binding” or cap in the Doha Round Agreement on Agriculture (DRAA). This may open a window for increased conservation payments in the United States.”

Concerned about the fact that all farmers might qualify for conservation program payments and the added expense, Purdue agricultural economists Zachary Cain and Stephen Lovejoy, expressed some doubt that such changes might be made. In their article, entitled, “History and Outlook for Farm Bill Conservation Programs,” in the 4/2004 issue of Choices Magazine, they said, “In a green payment system such as the CSP, almost every producer would be entitled to payments, not just those growing specific crops. Moving to such payments could decrease productivity, essentially driving up food prices. They require more planning and input from agencies like the NRCS, costing more money and further intruding on the farmers' independence. It will be interesting to see where the tradeoffs will be made among Americans' desire for a healthy environment, low taxes, cheap food, a profitable agricultural sector, and a dynamic rural economy. In an age of big budget deficits, it is probably safe to assume that we might not see a switch to solely green payments in the next farm bill, but rather a fight to keep the conservation payments we currently have.”

Summary:
Conservation issues may become the focal point for 2007 Farm Bill legislation, due to commodity price support programs drawing fire from trading partners, budget drafters, and consumers. In an effort to approve some type of income support program for agriculture, Congress may defer to the Conservation title in the Farm Bill and rely upon its acceptance in nearly every sector. Farmers concerned about their cash flow, may want to polish off their conservation plans and make appointments with their local NRCS office.