US Farm Bill 2008: Back to the Future?

After years of deliberation, eight temporary extensions of expiring law and two overridden vetoes, the Food, Conservation and Energy Act became law on June 18, 2008, framing the policy environment for US farmers for several years to come. The farm bill was written in a period of lean supplies, soaring demand, increased budget deficits, and intense scrutiny. When the dust settled the bill had five new titles, a new disaster program, and a new option offering an irrevocable choice of the traditional price-based safety net or a new revenue-based program. The latter constituted a new direction for US policy, moving towards more revenue based payments, a move that was resisted by the administration concerned with the implications for the WTO and that disapproved of the changes to the budget that financed the new programs. In the end the desires of the members of Congress trumped the administration's veto. FAPRI- MU's analysis shows that the impact of the 2008 farm bill on agricultural markets will be small. However, the direction of US agricultural policy is likely to put the farm bill at odds with the WTO, especially if there is a new agreement under the Doha round.