Political control of Congress is directly tied to the size of federal farm subsidy checks.

That simple fact explains why both parties are fighting so hard to pass a new Farm Bill. While only about 2 percent of Americans live on farms, some of this year's most endangered Senate Democrats hail from states that would gain from the whopping $73.5 billion increase in farm aid Congress is considering — South Dakota, Iowa, Minnesota, Montana and Missouri. Since Democrats control the Senate 50-49, with one independent, James Jeffords of Vermont, any of those contests could tilt the balance.

'”They have to get something for the agriculture community,” said Jennifer Duffy, who tracks Senate races for the Cook Political Report. “If nothing comes out of this, that's a huge downside because then you could start talking about Democratic gridlock. It takes on that bigger partisanship issue,” Duffy said

But there are pressures on both parties. President Bush initially opposed lawmakers' calls for the $73.5 billion, 10-year increase in spending. He relented not only to help candidates, but to secure crucial votes for his $1.35 trillion tax cut and a bill giving the White House more power to negotiate international trade deals.

Then there is the personal element. The White House is doing all it can to defeat South Dakota Democratic Sen. Tim Johnson — a close ally of Senate Democratic leader, and fellow South Dakotan, Tom Daschle. Bush personally recruited GOP Representative John Thune in the most bitterly fought race in the country.

“It's an incredibly contentious race of great attention virtually more of a battle between Bush and Daschle,” said Brad Redlin of the Center for Rural Affairs in Walt Hill, Neb. “Farm issues are primary.”

The agriculture debate didn't arise because of the election; Congress rewrites farm policy every five years. But the political stakes give it far more punch this year.

In 1996 a divided Congress voted to 'deregulate' farming by ratcheting down subsides and moving farmers toward export markets. Then prices tanked. Five years, four emergency bills and $30 billion in disaster payments later, both parties are focused on a more traditional policy of guaranteed aid, though without the rigid planting controls of past years.

Critics say such policies have led to a vicious circle of overproduction, inflated land values, and low prices. Most subsidies go to big producers, rather than small, family farms.

Farm programs are politically and economically entrenched in areas like the Great Plains, which gets more federal aid per capita than any other part of the country. Public attention was focused on Congress's recent economic stimulus package, but agriculture supports are far more vital in some regions.

“I have never had as many phone calls from lenders saying we're not lending because [growers] don't have cash flow without farm payments,” said Mary Kay Thatcher, lobbyist for the American Farm Bureau Federation.
Given the dwindling federal budget surplus, banks are no longer confident Congress will continue to step in with annual emergency aid, if negotiations on a long-term bill fail.

Lawmakers argue that subsidies stabilize an industry that faces volatile weather, unpredictable markets, and has been in a multiyear recession. Prices for some crops such as soybeans and cotton have fallen to 30-year lows since the 1996 farm bill, while farmers have also been hurt by bad weather. Without federal aid, farm income would have been at the lowest levels since the farm crisis of the mid-1980s.

“All I hear is disaster assistance. Montanans need disaster assistance,” said Democratic Senator Max Baucus — a prime target of Republicans — whose state has suffered from prolonged drought.

There is agreement on the general direction of the bill, but deep divisions on specifics. The Senate wants to slap a $275,000 per-farm cap on subsidies — a lower ceiling than the House wants. That has provoked a regional fight. Midwest grain farmers wouldn't take too big a hit, but southern producers of crops like cotton and rice, which have higher production costs, would.

The Boston Globe