For the year 2000, it is estimated that approximately 52 percent of the net income received by farmers nationwide will be from government farm payments. That number seems incredible, when you consider the number of farming enterprises that receive very low levels of government support. This early estimated data for 2000 also suggests that farmers in North Dakota and Indiana received over 200 percent of their net income through farm payments from Uncle Sam. In other words, these farm operations would have suffered a huge financial setback or would have went out of business in 2000, without the significant injection of federal farm payments. At the same time, many crop producers will give Freedom to Farm high marks for the planting flexibility aspects of the legislation.
Most farmers appreciate being able to make their own decisions on which crops to plant each year.
However, this flexibility has helped lead to large grain surpluses and significant acreage switches to some crops due to more favorable CCC loan rates and other factors. Soybean acreage increased about 1 million acres in 2000, and is expected to increase another 2 million in 2001. Most ag leaders, members of Congress, and other persons that follow farm policy feel that it is almost certain that we will have another Farm Bill in place when Freedom to Farm expires in 2002. There are some underlying questions dealing with farm policy philosophy which must be considered as we evaluate various Farm Bill alternatives. Payments that abnormally encourage or discourage production or distort prices compared to world grain prices are placed in the amber box, which has WTO limits.