Continuing Education and
Communication Services
3614 Administrative Services Building
Ames, Iowa 50011-3614
(515) 294-9915
11/5/01
Contacts:
Mark A. Edelman, Department of Economics, (515) 294-6144, medelman@iastate.edu
Del Marks, Continuing Education and Communication Services, (515) 294-9807,
delmarks@iastate.edu
Farmers Say Farm Bill Should Provide Safety Net
AMES, Iowa -- A survey of Iowa farmers indicates that they agree with a nationally-held view that government farm programs should provide a safety net for farm operators, according to an Iowa State University economist.
Eighty-four percent of the respondents to the Iowa survey and 80 percent from a national composite survey said "yes" when asked if government programs should provide a safety net. The national results were based on farmer surveys from 27 states that include 70 percent of the nation's farms. The Iowa results were reported by Mark A. Edelman, Iowa State University Extension public policy economist who conducted the Iowa survey in collaboration with the Iowa Agricultural Statistics Service.
The National Agricultural, Food and Public Policy Preference Survey project was organized by the National Public Policy Education Committee, which represents land grant university extension educators, and the Farm Foundation, a nonprofit organization based in Oak Brook, Ill., and the National Agricultural Statistics Services in participating states. The state surveys were conducted by mail during spring 2001. Iowa's results were based on 754 responses to a randomly selected sample conducted in April. "It was part of a comprehensive effort to examine agricultural policy options and to gather producer input on future farm, food and trade policies, most notably the 2002 Farm Bill," Edelman said.
"The survey indicates farmers are willing to take a lead role in caring for the environment, but also see a farm income safety net and greater trade opportunities as high priorities," Edelman said.
On the environment, the survey asked whether the federal government should provide financial incentives to encourage nine different environmental incentive programs. Programs ranking highest among Iowa farmers and nationally were incentives to improve water quality. "Ninety-four percent of Iowa farm respondents indicated yes, while 91 percent nationally said yes" to such programs, Edelman said.
On the safety net, 40 percent of the Iowa farmers said "yes" to increasing funding for direct income support programs to maximum levels allowed by international trade agreements. Another 40 percent of Iowa farmers said funding for direct income support programs should be continued at current levels. Twenty percent said all direct income support payments should be eliminated over a 5- to 10-year period. "This compares to 42 percent in favor of increased funding, 36 percent for continuing current levels and 22 percent for elimination, nationally," Edelman said.
On trade, Iowa farmers are slightly more free trade oriented than farmers nationally. Eighty-three percent of the Iowa respondents said farmers benefit from international trade, and 85 percent indicated that the United States should pursue free-trade agreements to reduce and eliminate trade barriers.
However, 72 percent also said that labor laws, environmental impacts and food safety standards should be included as part of the international trade negotiations. "In the national composite results, 75 percent of the respondents said farmers benefit from trade and 74 percent said pursue free trade agreements. But, 79 percent said include labor, environment and food safety issues in negotiations," Edelman said.
"Perhaps one of the most surprising responses in the survey results was farmer attitudes on labeling of biotechnology in food." Edelman said. Ninety-one percent of the Iowa survey respondents indicated that food products made with biotechnology should be labeled if there is a scientifically determined difference in the product. However, only 49 percent of the Iowa farmers said biotech food products should be labeled if there is no scientifically determined difference.
"The labeling issue is different for large and small farmers," said Edelman. Both large and small farmers say labeling is needed when there is a scientifically determined difference. However, when there is no scientific difference between biotech foods and foods already available on the market, 57 percent of the farmer respondents with less than $100,000 gross sales say label it anyway, while only 33 percent of the farmer respondents with more than $100,000 in gross sales say label it.
"Nationally, 61 percent of the small farmers said label biotech foods even if there are no scientific differences. However, only 35 percent of the large farmers agreed with such labeling," Edelman said.
Farm Income and Risk Management
Ten states asked questions about the base that should be used for counter-cyclical safety net payments. Farmers in all 10 states ranked net farm income first. Gross enterprise receipts, county farm income and gross farm receipts tied for second, and national farm income was last. Edelman said that the survey results suggest that farmers are more interested in a safety net that is counter cyclical to the conditions faced by their own farms than they are national payment triggers.
Farmers in Iowa and nationally also favored support payments tied to price over fixed payments or income support payments, subsidized insurance or disaster assistance. Nationally, farmers ranked tax-deferred savings accounts as the highest risk management priority, above increased crop insurance coverage and other tools. However, Iowa farmers ranked increased crop insurance coverage slightly higher than tax-deferred savings accounts. When asked what incentives, if any, should be used to encourage farmers to save for bad times, Iowa farmers indicated highest rank for deferred tax incentives, matching deposits and interest rate bonuses.
Producers were divided on the role of interstate dairy compacts. Most respondents want to expand the Northeast Dairy Compact to more regions of the country. However, if the program cannot be expanded, they favored allowing it to expire.
Conservation and Environmental Policy
Respondents favored either maintaining or increasing enrollment in the Conservation Reserve Program (CRP). "Through existing programs like the CRP, Environmental Quality Incentives Program (EQIP) and others, growers appear ready and willing to provide environmental benefits to society if society is willing to provide financial incentives for doing so. But it's also clear that if given a choice, in 11 state surveys including Iowa that asked the question, farmers are not in favor of shifting commodity program funding to pay for environmental incentive programs."
Most agreed that incentives to improve or support water quality, erosion control, biofuels, farmland preservation, wildlife habitat, animal waste management and open space preservation should be funded, but were mixed on endangered species habitat incentives and carbon sequestration.
While producers may see potential in being paid to store carbon in the soil and remove it from the atmosphere, respondents also may be unsure of the overall effectiveness and management constraints of sequestering carbon, contributing to what looks like a wait-and-see attitude, according to the report.
Trade and Food Policy
Most of the growers surveyed believed that they benefited from international trade, and supported expanding opportunities through free trade agreements and the elimination of unilateral trade sanctions. Trade negotiations, however, could be difficult as producers were also in favor of comprehensive deliberations including labor, environmental and food safety issues.
The vast majority (98 percent) favored country-of-origin labeling of food products. Respondents also strongly agreed that government efforts to improve traceability from consumer back to producer should be stepped up.
Agricultural Structure
Access to capital, education and training, and business development ranked as the most important goals for rural development, the survey showed. Those priorities ranked ahead of rural infrastructure and services funding and rural access to the Internet. The majority of growers agreed that maintaining or increasing farm and rural credit programs was important.
"The survey also showed that most producers look to the government to support a competitive marketplace, through the enforcement of existing antitrust laws and merger reviews, and through the collecting and reporting of agricultural market information," Edelman said.
A full report of the national survey is available in the 2002 Farm Bill section on the Farm Foundation Web site at http://www.farmfoundation.org. The Iowa survey results are available on the ISU Department of Economics Web site at http://www.econ.iastate.edu/ under agriculture outreach, special reports.
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