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Purdue Ag Economist Predicts Policy Shifts

With Democrats running Congress starting in January of 2007, Purdue University agricultural economist Allan Gray says to expect a new approach to agricultural policy.

Gray outlines the "four E's" that he believes will be central to the Democratic approach to agricultural policy: extension, environment, equity and energy.

'Extension,' in this case, refers to extending the 2002 Farm Bill.

"Some Democrats who are taking over chairmanships in the ag committees have generally been pretty favorable to the commodity title, or the subsidy system, of the 2002 bill," Gray says. "I think it is highly likely that they are going to push for an extension of those programs, meaning that direct payments, counter-cyclical payments and marketing loan payments are likely to stay the same."

In keeping with their past record, Democrats will probably push for greater environmental protections in agriculture, Gray says, pointing out that the new chairman of the ag committee, Sen. Tom Harkin, D-Iowa, authored the 2002 Conservation Security Program.

"Due to some changes in appropriations, that program never got funded as it was supposed to. I think Sen. Harkin will push to have that program become a bigger part of the next farm bill," Gray predicts.

Both Republicans and Democrats have talked recently about leveling the playing field between producers receiving different amounts of subsidies, making "equity" a potential issue as well. Gray says Congress may start "thinking about making those payments to a broader base of farmers."

The fourth E, "energy," has been a very hot topic, and both Republicans and Democrats support initiatives to reduce U.S. dependence on foreign oil by promoting biofuels, Gray says. Although the two sides generally agree on this approach, Gray expects the Democrats to "push that agenda a little bit harder."