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The US Congress has passed a $290 billion farm bill, which will increase subsidies to US farmers and cut international aid programs.

George Bush has threatened to veto the bill, however, but there is still a good chance it will be passed into law. Interestingly, the presidential candidates response to the bill were contrasting with John McCain critical, Hilary Clinton supportive and Barack Obama labelling it as “far from perfect”.

“It does not target help for the farmers who really need it, and it increases the size and cost of government while jeopardizing the future of legitimate farm programs by damaging the credibility of farm bills in general,” Agriculture Secretary Ed Schafer stated. “At a time of record setting income for farmers, it sends the wrong message to the rest of the country who are not experiencing the boom of the agriculture sector. This bill is loaded with taxpayer funded pet projects at a time when Americans are struggling to buy groceries and afford gas to get to work.”

“Eight months behind schedule, Congress will send a bill to the President that is trade distorting and fails to provide meaningful reform to the adjusted gross income limit, beneficial interest or the international food aid program,” he added.

Raymond Offenheiser, President of Oxfam America, was also strong in his criticism of the bill. “Faced with a mounting food crisis at home and abroad, Congress had the opportunity through the Farm Bill to shift funds from wasteful agricultural subsidies for large scale farms to food aid to meet the needs of the poor,” Mr Offenheiser said. “But instead, Congressional leaders settled on a bill that will continue to be costly to taxpayers, undermine our rural economy, damage our trade relationships, and hurt the world’s poorest farmers.”

The slight decrease in tax credits to ethanol producers (by 5c per gallon) and increased conservation funding were welcomed, although many believe the cuts in tax credits do not go far enough.

With global food prices skyrocketing this year and global fears of a potential food shortage growing, the bill sends a disappointing message from the US to the rest of the world.

Tags: adjusted gross income, agricultural subsidies, agriculture secretary, agriculture sector, barack obama, beneficial interest, ed schafer, ethanol producers, farm bill, farm bills, Food, food aid program, food crisis, food price, food prices, ford, hilary clinton, international food aid, john mccain, meaningful reform, oxfam america, rural economy, target, trade relationships, us congress

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Under the deal, aimed at averting a recession in the world%26#39;s largest economy, individuals would get a maximum rebate of $US600 and married couples could get up to $US1,200.
Individuals with annual incomes above $US75,000 in adjusted gross income (AGI) and married couples making $US150,000 in AGI would get less depending how high their incomes are above those thresholds.
The size of the package is equivalent to around 1 percent of US gross domestic product, according to one source close to the negotiations. President George W. Bush has said an initiative of that size should help give the economy a %26quot;robust%26quot; lift.
The White House cautioned that nothing was final yet.
%26quot;Our understanding is that there is no final deal yet but they are making progress,%26quot; White House spokeswoman Dana Perino said.
Congress and the Bush administration have been negotiating for several days in an attempt to inject money into consumers%26#39; pockets to minimize the fallout from an economic slowdown, prompted by the mortgage and credit crises, that some fear could slide into a recession.
One issue of contention was whether the rebates would be distributed to just those who paid income taxes or whether low-income people who do not earn enough to owe taxes would also get them. Democrats had sought to ensure that the rebates would be given to these workers as well.
LOW INCOME WORKERS
Under the package, workers who made at least $US3,000 last year and paid no income taxes would be eligible for a check of up to $US300 for individuals and up to $US600 for married couples, according to the aide.
Low income filers who paid some income taxes get an additional rebate of $US300 per child.
Still, the deal could upset some Democrats who had hoped to get more aid for poor people, and some conservative Republicans who are worried it will increase the US budget deficit and are skeptical rebates will boost the soft economy.
The package includes incentives for businesses to make new equipment purchases and other investments. Businesses would be able to immediately deduct 50 percent of the costs.
Furthermore, businesses would be able to write off more of their current losses against previous tax years.
Lawmakers could announce details as early as today.
According to one congressional aide, the package will not include increases in food stamp benefits for the poor or extending jobless benefits. Democrats had pushed for the inclusion of such provisions.
The package includes provisions to address the US housing market crisis by allowing Fannie Mae and Freddie Mac, the government-sponsored mortgage purchasing companies, to buy larger loans, sources said.
Fears of a US recession prompted a worldwide sell-off in financial markets this week. But expectations of a stimulus package and an emergency interest-rate cut of three-quarters of a percentage point by the Federal Reserve on Tuesday appear to have helped soothe financial markets.
The Dow Jones industrial average, which rose by nearly 300 points on Wednesday, was about 50 points higher in midday trading on Thursday (Friday morning NZT).

Tags: adjusted gross income, bush administration, Food, job, romp, spokeswoman, ups

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