United States farm subsidy programs are again proving to be a major obstacle to expanding international trade opportunities at Geneva meetings aimed at reviving the Doha round of trade negotiations. Opponents of farm subsidy reform may be applauding this impasse, but there is be no reason for glee from the public at large. U.S. farm subsidy programs are broken and need to be fixed.

The farm program has been a 70-year failure. It helps rich farmers get richer, drives small farmers off the land, and is costly to both taxpayers and consumers. Between 2002 and 2006, subsidies and so-called disaster assistance averaged $20 billion annually. Farm subsidies increased the cost of food by $16.2 billion in 2004. Federal milk marketing orders alone impose a $1.5 billion annual "milk tax" on consumers. The import-restricting sugar program costs consumers $1.9 billion annually in inflated prices for sugar and sugar-containing products.

Earlier this year, the Bush Administration released its 2007 Farm Bill proposal. The Bush farm plan did incorporate some good ideas, but it was mostly a disappointment for those, including Citizens Against Government Waste, looking for greater reform of archaic agriculture policies.

The Bush Administration missed an opportunity to propose significant reform, leaving the farm program largely intact. The plan does nothing to reform product-specific, trade-distorting income and support programs (including price supports and countercyclical and loan deficiency payments), nor does it reform the antiquated sugar and dairy programs. The administration plan also fails woefully by not proposing to lower the overall payment limitation from the current $360,000 to a more reasonable level of $50,000 or $100,000.

To its credit, the Bush proposal acknowledges that present agriculture policy, in which the top 10 percent of farm subsidy recipients collect 73 percent of all subsidies, is inequitable and costly. It proposes eliminating subsidy payments to individuals with an adjusted gross income (AGI) of $200,000 or more, and the three-entity rule that allows some subsidy recipients to triple-dip. However, the proposal should have gone even further by eliminating payments to those with an AGI in excess of $100,000, which is 50 percent higher than the average American household.

The only other slight improvement in the administration proposal is to make the countercyclical payments based on revenue rather than on historic production. This means that farmers would receive fewer subsidies if they have a good financial year. Currently, farmers get a set level of subsidies whether they need them or not.

Even the modest reforms proposed by the Bush Administration face an uphill battle in Congress. The proposal had barely been announced when House Agriculture Committee Chairman Collin Peterson (D-Minn.) expressed his hostility toward "any payment limits at all."

Sen. Saxby Chambliss (R-Ga.), ranking member of the Senate Agriculture, Nutrition and Forestry Committee, is also adamantly opposed to lowering the AGI cap. In bipartisan fashion, Chambliss appeared with Sen. Blanche Lincoln (D-Ark.) in Little Rock, Arkansas, where they argued that "$200,000 sounds like a lot of money to most people, but to farmers, it's not that much." Chambliss says that's because farming operations and equipment are expensive.

Two hundred thousand dollars sounds like a lot of money because it is a lot of money - more than three times the income of the average American household. Certainly, Sen. Chambliss is aware that AGI takes into account the expenses of farming operations and equipment. In fact, farmers have more opportunity to deduct expenses from their tax bills than the average taxpayer.

Taxpayers would not be the only ones to benefit from a reform of farm subsidies, whether through the Farm Bill or a successful Doha round. Elimination of trade-distorting subsidies in exchange for significant tariff reductions could raise U.S. farm prices by 12 percent, increasing annual farm earnings by as much as $13.3 billion. Moreover, expansion of trade and economic development in emerging markets could lift millions of people out of poverty and create new markets for U.S. products, including agricultural goods.

The farm lobby's opposition to farm subsidy and trade reforms is short-sighted and will only end up harming the agriculture industry in the long run. John Frydenlund is the Food and Agriculture Policy Director at  Citizens Against Government Waste http://www.cagw.org