Obama calls for "revamping" of farm support system, possible income caps for subsidies

Matt Harsh asks President Obama a question in CBS News' Town Hall meeting on May 11, 2011.

President Obama said in a CBS News' town hall meeting on the economy on Wednesday that it may be time to put an income cap on farm subsidies in order to ensure governmental assistance isn't being funneled to big agri-businesses that don't need them.

Special coverage: CBS News Town Hall on the Economy, with President Obama

In the town hall, most of which aired Thursday morning on "The Early Show," audience member Matt Harsh, a fruit and vegetable farmer, asked the president what his plan was for "weaning agriculture off of federal farm support."

"I'm probably one of the only farmers you'll ever meet who feels that federal farm subsidy payments and programs are misguided, and are not the way we should be supporting the American farmer," Harsh told Mr. Obama.

But, he argued, "They're antiquated. It's just the wrong approach in my opinion. I really think we need to back up from that, and create a more robust - and entrepreneurial - economy for our farmers."

The president agreed that federal subsidies don't always benefit the farmers who most need the government's assistance - and that "our system of farm support needs revamping."

"Part of what we want to do is to make sure that help is going to family farms in crisis situations. Drought, disaster and so forth," said Mr. Obama. "That we're not just giving ongoing subsidies to big agri-business. Which is the way that a lot of our farm programs work right now."

One possible solution, he proposed, was imposing income caps on eligibility for receiving government aid.

Obama reckons with economy at CBS News town hall
Laid-off government worker makes appeal to Obama Obama town hall after show: What did the audience think? Obama calls for deficit reduction "incentives"

"It may start just modestly by, for example, limiting those subsidies to what is a genuine family farm," Mr. Obama told Harsh. "You know, which would put some sort of income cap on whether or not you qualify for this kind of subsidy."

"It shouldn't be just an ongoing subsidy program when farmers can make it on their own," he added.

Still, Mr. Obama noted that efforts at implementing these changes would likely face resistance from the farming community.

"I've got to confess to you that sometimes change is hard when it comes to farm programs," Mr. Obama told Marsh. "Democrats and Republicans on those [related congressional] committees are typically from farm states where, you know, folks are pretty supportive of the existing programs. And so, trying to bring about change there is tough."

The question was part of web-only portion of the town hall, which you can watch above. Mr. Obama also spoke to the question of whether or not it was truly possible "to have a pro-growth economy that creates jobs while at the same time, meaningful deficit and debt reduction."

"I am absolutely convinced that we can do it," the president told Sarah Spear, the audience member who asked the question.

"I think it's very important to reduce our deficit using a scalpel and not a machete," he continued. "We can make cuts on programs we don't need. We can make modifications to programs that may not be working as well as they should be or are outdated. But we can't stop investing in medical research. We can't stop investing in our infrastructure so that businesses can get their products to where the customers are. We can't stop making sure that Pell grants are there for young people so that they can get an education."

Mr. Obama reiterated a point he has made repeatedly in recent months: "The key here is a balanced approach that understands we have to invest in the things we need to grow, but those things that aren't helping us grow, we can reduce."

More from the town hall will also air on "Face the Nation" on Sunday morning.