Dems Cut Deals To Move Farm Bill Forward

Democratic leaders of the House of Representatives added money for international food aid and settlement of racial discrimination claims as ways to entice their party mates to push through a broad, five-year farm bill to extend agriculture and nutrition programs.

Amid internal divisions and Republican defections, those and other last-ditch enticements were thrown into the mix Thursday to ensure passage of the multibillion-dollar legislation over strident objections of Republicans and the Bush administration.

The House vote is planned Friday.

Leaders promoted the bill as an important step toward modernizing farm programs. Still, it would leave in place and in some cases increase subsidies to producers of major crops and contain far less money for conservation and nutrition programs than many Democrats wanted.

The Democrats' late hunt for votes was an unfamiliar scene for a farm bill, which usually has broad appeal across party lines due to strong regional coalitions that spring up around crops rather than ideologies. Until this week, that also was true of this year's measure.

On Wednesday, however, farm-state Republican lawmakers, once strong supporters of the bill, staged a revolt against tax increases included as partial payment of the $4 billion (euro2.9 billion) worth of domestic nutrition programs in the bill.

They balked when Democrats decided to raise money for nutrition programs with a provision by Democratic Rep. Lloyd Doggett to tax certain foreign-owned companies with U.S. subsidiaries.

With the business community lobbying vigorously against the measure, Treasury Secretary Henry Paulson wrote Congress on Thursday that the plan would cost U.S. jobs by disrupting foreign investment and ruining relations with trade partners.

"The tax proposal would raise taxes on foreign investment into the United States, thus discouraging such investment and the resulting job creation. Foreign-owned companies provide, directly and indirectly, millions of jobs in the United States," Paulson wrote to Rep. Jim McCrery of Louisiana, the top Ways and Means Committee Republican.

Doggett said the plan would not affect "legitimate multinational corporations that are not employing a haven to dodge American taxes."

And Democratic leaders denounced Republicans for their sudden reversal, accusing them of caring more about protecting big multinational corporations than the farmers in their districts.

They also went shopping for more votes in their own party, especially among urban and suburban lawmakers.

They won over Rep. Jim McGovern of urbanized Massachusetts, with the promise of more funding for an international food aid program. Money to settle U.S. Agriculture Department racial discrimination claims from the 1990s was offered up to cement support among members of the Congressional Black Caucus.

House Speaker Nancy Pelosi, the chief Democrat and leader of the House, "had to knock some heads together" to scrounge up enough Democratic support, said the Democratic Agriculture Committee chairman, Rep. Collin Peterson.

Pelosi already was walking a fine line on the measure, struggling to balance her desire to protect farm-state farm state Democrats who had a strong stake in traditional farm programs with her party's promises to include substantial reforms.

The White House has threatened a veto, saying the legislation does not cut farm subsidies enough. Agriculture Secretary Mike Johanns said the legislation misses opportunities for reform.

The bill would ban subsidies to farmers whose income averages more than $1 million (euro730,000) a year and stop farmers from collecting payments for multiple farm businesses. Still, it includes some $42 billion (euro30.6 billion) in subsidies and other aid to farmers.

An administration proposal would go further, banning subsidies to farmers with incomes averaging $200,000 (euro145,750) and imposing stricter payment limits.

Despite leadership efforts to unite the majority, some Democrats remained opposed. A showdown vote was expected on an amendment by Democratic Rep. Ron Kind to scale back subsidies in favor of conservation, aid for specialty crops like fruits and vegetables and nutrition and rural development programs.

Kind's measure would bar payments to farmers earning an average of $250,000 (euro182,190) annually. Its adoption could kill the farm bill by sapping it of vital support from rural lawmakers.

Democrats' late hunt for votes was an unfamiliar scene for a farm bill, which usually has broad appeal across party lines due to strong regional coalitions that spring up around crops rather than ideologies. Until this week, that also was true of this year's measure.

Republicans balked when Democrats decided this week to raise money for nutrition programs with a provision by Democratic Rep. Lloyd Doggett to tax certain foreign-owned companies with U.S. subsidiaries.

With the business community lobbying vigorously against the measure, Treasury Secretary Henry Paulson wrote Congress on Thursday that the plan would cost U.S. jobs by disrupting foreign investment and ruining relations with trade partners.

"The tax proposal would raise taxes on foreign investment into the United States, thus discouraging such investment and the resulting job creation. Foreign-owned companies provide, directly and indirectly, millions of jobs in the United States," Paulson wrote to Rep. Jim McCrery of Louisiana, the top Ways and Means Committee Republican.

Doggett said the plan would not affect "legitimate multinational corporations that are not employing a haven to dodge American taxes."

And Democratic leaders denounced Republicans for their sudden reversal, accusing them of caring more about protecting big multinational corporations than the farmers in their districts.

The current farm law expires Sept. 30. The Senate is due to begin its consideration of the legislation in September.