Q&A: Why US grain embargo may not be dropped

Why hasn't President Reagan carried through on his campaign pledge to scrap the Soviet grain embargo? Because evidence mounts that the Soviets had to scramble to make up for the 17 million metric tons of feed grains cut off last year by the January 1980 embargo.

Ever since President Carter responded to the Soviet invasion of Afghanistan by embargoing new grain sales, experts have lined up on every side of this issue. But even some solidly Republican experts advise Mr. Reagan that the only fault with the embargo is that it leaks -- with the main leaks due to "lenient" US government policy authorizing many US and foreign grain shipments that could have been blocked. Is the Reagan Cabinet split over the embargo question?

Not in the sense that a pro-embargo State Department is squaring off against a ban- the-embargo Agriculture Department.

Secretary of State Alexander Haig has said lifting the embargo now would "give the Soviets the concession they want most."

Agriculture Secretary John Block continues his outspoken support for ending the embargo, arguing that it hurts US farmers more than it hurts the Soviet economy. But the State Department continues to study and weigh the economic costs of the embargo at home. And block, Says an aide, "is a West Point man himself, who's ready to embargo everything if national security is at stake." Has the embargo hurt the Soviet Union?

Yes -- but perhaps also no. Soviet and US statistics confirm that the embargo combined with poor harvests have forced Soviet planners to cut meat and milk production. Moscow is expected to import more than 34 million tons of grain this year, but at an extra $1 billion in higher prices for Argentinian grain and higher shipping charges.

US Rep. Peter A. Peyser (D) of New York, sponsoring a resolution supporting the embargo, has broad bipartisan support in Congress for his view that the Soviets are hurting and will hurt more as the US-imposed grain shortage shows up in continuing meat shortages over the next two years.

The counter argument is that the embargo helped teach the Soviets not to depend on the United States for grain -- and that the Soviets are net winners from being forced to find new suppliers. Privately, however, Soviet officials in Washington have said they want to resume buying US grain. Has the embargo hurt the United States?

Overall, despite the embargo, US farmers increased their grain exports last year and expect further increases.

But farmers are left with two hard-to-calculate concerns. They dub the embargo "the South American AGricultural Act of 1980," claiming it cut US grain prices by $1 to $1.50 per bushel, with Argentina and Brazil getting that much extra for their grain. As well, they feel the embargo undermined America's reputation as a reliable supplier, thus driving not only the Soviets but others to new suppliers.

Farmers are worried that the five-year Soviet-US grain sale agreement, Which expires in September, won't be renewed. They point out that the agreement largely benefits the US, by stabilizing year-to-year Soviet grain purchases. What are the State Department's reasons for wanting to keep the embargo?

The chief argument is that ending the embargo would "signal" the Soviets and our Western allies that the US is ending its objections to the Soviet presence in Afghanistan. Such a signal, it is thought, could increase the risk of Soviet intervention in Poland.

The State Department wants instead to send a clear signal that improved relations depend on Soviet observance of the 1972 Nixon-Brezhnev "code of conduct" under which the two countries agreed "to do their utmost to avoid military confrontations and to prevent the outbreak of nuclear war." What are the Agriculture Department's reasons for wanting to lift the embargo?

The main arguments are that embargoing grain sales unfairly discriminates against farmers, cuts vital US export earnings, and cuts a trade tie that has encouraged the Soviets to pursue peaceful relations with the West. Why is Reagan expected to maintain the embargo?

Because of Poland -- and because of domestic politics.

Embargo opponents recognize that Reagan has three options: lift the embargo, extend it to include other exports, or "refer it to further study." Many now expect him to pick the third option. The reason: If the Soviets invade Poland or step up aggression elsewhere, Reagan could respond with a broadened embargo. He also may come under new domestic pressure for a grain embargo if this year's US grain harvest is poor and supplies become tight. In either case, he would find it wiser politically to extend a "Carter embargo" than to lift it and th en later impose a "Reagan embargo."