updated 7/27/2007 2:52:52 PM ET 2007-07-27T18:52:52

The Democratic-controlled House passed legislation Friday that combines billions in aid to farmers with funds for low-income nutrition programs, defying a veto threat from President Bush over the bill’s largesse to crop producers.

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The measure, which was passed on a vote of 231-191, devotes more money to conservation, renewable energy, nutrition and specialty crop programs than in the past but leaves in place — and in some cases increases — subsidies to producers of major crops such as corn and soybeans at a time of record-high prices.

It reflected a delicate straddle for Democrats writing their first farm bill in a decade, who struggled to balance the needs of first-term, farm-state lawmakers against the demands of liberals seeking more money for environmental and nutrition programs.

House Speaker Nancy Pelosi, D-Calif., said the measure “signals change and shows a new direction in our farm policy,” but it fell well short of the changes many in her party had demanded.

Democrats rallied around the bill, however, after debate turned bitterly partisan over a tax measure included to finance some $4 billion in food stamp and other nutrition programs. The plan would impose new taxes on certain multinational companies with U.S. subsidiaries.

'An unprecedented move'
Democrats said they were closing a loophole and cracking down on foreign tax-dodgers, while Republicans called it a massive tax hike that would affect manufacturers that provide millions of jobs in their districts. The spat sapped the farm bill of much of its customary bulletproof regional appeal, turning many rural Republicans against the measure.

“This is an unprecedented move to use a farm bill as a vehicle to increase taxes,” said Rep. Adam Putnam of Florida, the No. 3 Republican. “We could have put the House imprint on the farm bill, and now it is veto bait, and that is a tragedy.”

The legislation aims to ban subsidies to farmers whose income averages more than $1 million a year, down from the current limit of $2.5 million. It also would stop farmers from collecting payments for multiple farm businesses. Still, it includes about $42 billion in assistance to farmers.

It came after Democrats quashed a rebellion from one of their own, Rep. Ron Kind, D-Wis., who teamed with conservative GOP budget hawks and urban and suburban Democrats on an amendment to wean farmers from government payments. It would have imposed stricter income limits on farmers, barring subsidies to those making an average of $250,000 or more annually, and would have steered more money to conservation, nutrition, specialty crop and rural development programs.

Conservation, nutrition programs funded
The amendment lost on a lopsided vote, but Pelosi credited it with creating the pressure to invest more farm bill resources in nontraditional programs.

“I had high hopes that this Congress — given market conditions and our commitment to a new direction for this country — would have the stomach to reform these outdated and unfair policies,” Kind said in a statement. But he said his efforts had prompted increases for conservation and nutrition programs, and made “some modest inroads” on curbing subsidies.

Still, the overall measure was a huge victory for farmers, who got much of what they asked for in a year when they sometimes feared their priorities would be trumped by Democrats’ talk of overhauling the way agricultural money is allocated.

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