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Betting The Farm On Free Trade


Across the midwest, rural radio stations are airing ads that feature a famous quote from President Dwight D. Eisenhower: "Farming looks mighty easy when your plow is a pencil and you're a thousand miles from the cornfield." The ads are sponsored by the National Farmers Union, a group representing family farms, and it's no secret that the Washington pencil-pusher being targeted is American Farm Bureau Federation President Bob Stallman.

Even Stallman, who grew up on a 1,100-acre rice and cattle farm in Columbus, Tex., ruefully calls himself "a cell-phone farmer." But it's not his pinstripe suits or corner office overlooking the U.S. Capitol that get the goat of the NFU. It's the way Stallman is dividing farm country by leading the 5.6 million-member Farm Bureau, the nation's most powerful agricultural lobby, in a strong free-trade direction. Stallman favors low worldwide tariffs and a cut in government handouts, reasoning that large-scale, mechanized, and superefficient American farmers can export their way out of the commodity glut dogging the industry.

That stance puts Stallman at the epicenter of a raging controversy over the future of American farming. Other voices representing small farmers and their struggling rural communities -- the NFU and the National Family Farm Coalition among them -- fear being crushed between giant U.S. agribusiness and tons of food from developing countries.

The debate will heat up in the coming months. In June, Congress will take up the Central American Free Trade Agreement (CAFTA) between the U.S. and six Caribbean Basin countries -- a deal that would open the U.S. to increased imports of sugar, among the most heavily protected crops in America. Meanwhile, the Geneva-based World Trade Organization is pushing Europe and the U.S. to trim the hefty subsidies that provide some farmers with a third or more of their income. Agriculture "is the tiebreaker" that will bring developing nations to the table for an overall deal that will include manufactured goods and services, says U.S. agricultural trade negotiator Allen F. Johnson. The Farm Bureau supports CAFTA and the WTO initiative in the face of critics who insist that trade deals will hasten consolidation of U.S. farms into large-scale corporate agriculture.

Despite skepticism among some farm families and rebellions by state Farm Bureau offices in North Dakota, Louisiana, and Colorado, Stallman remains an adamant free marketer. During nearly six years heading the Bureau, he has beefed up its economic analysis and insists that its studies demonstrate that America's farming future lies in exports.

If Stallman has any sentimental attachment to the family farm, it doesn't show in the number-crunching. "It is important to maintain a productive and profitable agriculture sector, but the questions of who should be farmers, and what size farms should be, and what the countryside should look like -- those are social issues," Stallman declares. "If you want a social program, look at what the European Union spends to maintain its countryside and keep individual families on farms." Washington would have to pay subsidies four times as high as it does now to halt the trend toward consolidation, he says.

Such hard-nosed calculations draw considerable support from farm economists. "He is seeing the whole forest instead of looking to save every single tree," says Paul A. Drazek, an independent farm analyst and adviser to the Bush Administration. The nation's First Rancher also is a fan, and little wonder: As head of the Texas Farm Bureau, Stallman engineered an endorsement of long-shot challenger George W. Bush in his successful campaign for governor in '94.

To Stallman's critics, free-trade deals are the key to ruin, not prosperity. They point to the dwindling U.S. trade surplus in farm products, which the U.S. Agriculture Dept. predicts will turn to a deficit this year. During the 1990s, the North American Free Trade Agreement, establishment of the 147-nation WTO, and trade deals with China all failed to kick-start exports. But they did encourage imports of meat, fruit, vegetables, and wine.

DICTATING PRICES

"We have been hearing forever that we are just one trade agreement away from prosperity," says Tom Buis, vice-president for government relations at the 103-year-old, Denver-based NFU. While he calls Stallman "a very bright agricultural leader," Buis insists that the consolidation that Stallman considers inevitable "is a huge issue to rural America." Giant purchasers -- such as Tyson Foods (TSN) and Archer Daniels Midland (ADM) -- are increasingly able to dictate prices. Also, "Just having diversified family farms helps sustain a stronger rural economy," insists Katherine Ozer, executive director of the National Family Farm Coalition.

In the end, the future of CAFTA and the summer's farm policy debate may well hinge on the American sugar industry. Although sugar growers account for less than 1% of the nation's 2.1 million farmers, they wield political power in Washington far in excess of their numbers. Republicans from such states as Idaho and Georgia will hesitate to sacrifice their sugar farmers on the altar of free trade. Unless the Administration can attract 30 or so Democratic House members to make up for expected GOP defections, CAFTA dies. Ironically, the sugar program is the last vestige of the 1930s-era government supply-management programs once championed by the Farm Bureau. "Some of my best friends are sugar farmers -- cane and beet," says Stallman. But, he calculates, "The damage to sugar is minimal compared to the benefits for all agriculture."

Even more ironic, in the 2000 race for Farm Bureau president, Stallman beat 14-year incumbent Dean R. Kleckner by promising to concentrate more on domestic programs than on a free-trade agenda. Instead, Stallman buttressed the organization's finances, moved its headquarters from Chicago to Washington, and eventually shifted the Farm Bureau focus back to trade. While willing to swap subsidies for lowered import barriers abroad, Stallman insists: "We won't unilaterally disarm." But in the long, hot summer ahead, his biggest worry won't be battles abroad, it'll be friendly fire at home.

By Paul Magnusson in Washington


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