The New American Farmer

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up the money to use it.

A final uncertainty facing agriculture is Government farm policy. Pat Benedict complains that it consists of "frustrating contradictions," and he has a point. For 40 years, starting with the New Deal, policy aimed at having farmers restrict production and sell at high Government-supported prices. In 1973-74, Earl Butz tried a new tack: he lobbied through Congress the law under which farmers could no longer unload their crops on the Government, urged them to increase output by planting "fence to fence," and set target prices far below market quotes. He got away with it because rocketing export demand permitted farmers for a year or two to sell everything they could grow at prices that the Government did not have to prop.

The Carter Administration, which took office when farm prices were falling drastically, partially reversed the Butz policy. Besides urging farmers to participate in set-aside programs, it has, with considerable prodding from Congress, established target prices for wheat and corn that are above today's market quotes, even though these target prices by no means guarantee farmers a profit. Government outlays to support farm incomes have quadrupled in two years, to an estimated $7.9 billion in fiscal 1978. But the Administration has resisted pressure to set support prices still higher—even though Agriculture Secretary Bob Bergland last winter had to climb out a basement window to escape a few fanatic farmers who invaded his office demanding that the Government bail them out.

There is considerable room for improvement in farm policy. If some form of price support has to be continued—and a case can be made for it as a kind of disaster insurance—the practice of setting target prices just high enough to cover most production costs is a good one. But many experts believe the Government should drop its set-aside programs and once more urge farmers to produce. The U.S. and the world need all the food that American farmers can grow. Set-asides also tend to benefit big farmers, who can more easily take, say, 10% of their land out of production than small growers can.

Congress has already put a ceiling —in most cases $40,000 a year —on the target-price payments that any one farm can receive. It could go further and establish a sliding scale, with full target prices applying only to the first 50,000 or so bushels of a farmer's production. That would funnel a larger portion of the payments to small farmers who have less ability to survive a one-year loss.

Washington also could help all farmers—and the world—by pushing agricultural exports even harder. For example, U.S. negotiators at the world trade talks in Geneva might insist that the nation will do nothing to open the U.S. market wider to European and Japanese goods unless industrialized nations let in more American-grown food. The Government might also expand its aid—$10 million this year —to farmers who organize cooperative groups that develop foreign markets. One tempting target: China, which has just begun to buy U.S. meat and grain and could use more. Carter has signed a new law that permits indirect Government loans to finance food exports to China and establishes U.S. Agricultural Trade Offices overseas, strengthening efforts currently carried on by embassy officials.

In the end, the