This spring is a good time to sit up and pay attention to congressional action. Red ink may make budget knives a reality in the farm bill's future. Just over 2 years ago, when another congressional majority was busy formulating the farm bill, the nation had a budget surplus and no looming bills on foreign wars. But that budget reality gave way to today's volatile world in which the government needs to impose fiscal discipline--in other words, no government-funded program is entirely safe.

Of course, in political issues like these, no one can accurately predict outcomes. It's all speculation. But normally conservative observers are speculating that conservation offerings will be the first items on the chopping block. In large part that's because many of those provisions are either first-time or recent additions. Consider, too, that Congress went straight to the brand-new CSP (Conservation Security Program) to fund this year's disaster assistance payments. That's bad precedent for other conservation items.

As a result, say Beltway observers, farmers should at least consider the impact of substantial reductions on federal environmental and conservation programs. Specifically, look to EQIP (Environmental Quality Incentives Program), WHIP (Wildlife Habitat Incentive Program), CRP (Conservation Reserve Program), Grasslands Reserves, Wetlands Reserve Program and even renewable and bioenergy programs.

Those being impacted by confined animal feeding operation (CAFO) regulations should consider how their projects would be affected by government cuts. Reduced spending means less money available in cost-share items.

Expect, too, that farmers who were planning to use federal funds on conservation projects won't be nearly as disappointed as the environmental and conservation groups who will howl in protest. Those howls might actually help reduce the likelihood of severe cuts.

The new farm bill added $17 billion in new funding measures for conservation purposes. That makes for an easy and obvious target in negotiations. In large part, the money is vulnerable because, by early March, Congress had yet to officially appropriate the cash.

And a cash crunch is definitely coming if all the signs are right. Fed chief Alan Greenspan, in his mid-February report to Congress, gave tacit approval to the president's tax cuts only if they were offset by spending reductions. That increased the odds of a good budget trimming.

In fact, astute listeners to Greenspan's testimony focused on the number of times he used the phrases "difficult choices" and "fiscal discipline." At one point he settled all doubt by saying, "However, there should be little disagreement about the need to reestablish budget discipline." That's clear language for Washington and puts politicians on notice that spending cuts are mandatory for economic health.

On the positive side, congressional observers expect budget trimming will be offset partially by projections of good news on the agricultural economic front. Respected analysts are forecasting good-sized increases in farm income, mainly from increasing production (cash and livestock receipts totaling the highest in years) rather than simply hikes in government program benefits.

The Federal Reserve expects higher livestock prices to lead a rebound in net farm income. In fact, they expected a modest recovery from 2002's $9 billion drop. Additionally, agricultural land values are expected to provide a source of strength.

All in all, keep your eyes open. To paraphrase Will Rogers, Congress is like a baby with a hammer. You don't know what to expect in the way of damage but keep watching till you get a hold of that hammer.