Search

The future of U.S. agriculture could be reshaped by the convergence of two major policy initiatives over the next two years: the 1990 farm bill and the effort to liberalize world agricultural trade under the auspices of the General Agreement on Tariffs and Trade (GATT). The debate related to these two initiatives, until now, has been carried out in separate arenas. The progress of the Multilateral Trade Negotiations (MTN) toward a targeted 1991 completion date and the pending renewal of U.S. farm legislation will force these two initiatives to be considered jointly within the next few months. In particular, the outcome of the 1990 farm bill debate in the U.S. Congress will provide an early indication of the direction the United States will take in its own policies and how those policies might fit into a negotiated agreement. Past U.S. farm policy has been formulated primarily on the basis of commodity group demands constrained by mild budget pressures. The debate on the 1990 farm bill, however, promises to be different. Growing budget pressure imposed by the Gramm-Rudman-Hollings Act, which requires the Congress to reduce the budget deficit to a specified target each year until the deficit is eliminated, could force legislators and the administration to accept lower levels of support than they would have. In this budget-cutting environment, the gains from a mutual reduction of agricultural trade barriers through an agreement in the multilateral trade negotiations presents an attractive alternative.