Release No. 0023.97
Remarks
                               of
             Secretary of Agriculture Dan Glickman
             National Cattleman's Beef Association
               Kansas City, Mo.--January 31, 1997
INTRODUCTION
     Thank you. I'm thrilled to be here in Kansas City for this convention.
First, I'd like to congratulate John Lacey for the superb job he's done
leading this organization during a very challenging year. Max Dietz, your
new president, will have big shoes to fill ... but I have every confidence
in Kansans. I'm sure he'll do a great job. I'd also like to thank Chandler
Keys, the head of your Washington office. He's a fine champion of America's
cattlemen.
     America will succeed in the new century, but we have to rethink old
roles and responsibilities. We have to recognize now that we're headed into
a dramatically different world ... one where national borders are not
absolute barriers ... where markets are freer and fairer ... where
government exerts less control of agriculture and more power rests directly
in the hands of farmers and ranchers.
     We're playing on the international stage now. And we're all working
toward the same things -- safe, high-quality food, strong economic
opportunities, and a country with an agricultural future capable of
surpassing its own stunning history. Let's get it together. Let's  create
the link.'
THE YEAR IN CATTLE
     That's the philosophy we at USDA have shared with this organization in
recent years. It's given us a solid record. Just look at the past year:
     We overhauled a 90-year-old inspection system -- reaffirming that
     America's beef is the hands-down safest in the world. You knew it was
     the right thing to do, and you came to the table and helped us craft a
     stronger rule and a safer America. Thank you. I know you're also
     concerned about difference in meat and poultry inspection standards.
     It's going to take some time to bring the systems closer together, but
     we will wherever good science says we should. Next week, I'll issue a
     final rule to clarify and strengthen our zero tolerance policy for
     fecal contamination of poultry. We're working on other areas as well,
     including water gain.
     In the past year, USDA took the first hard look at concentration in
     the meat-packing industry. You backed us up. We sought an expanded
     reporting system and improved enforcement, so all producers can have
     the information they need to be better marketers, and you said  OK.'
     We both want to see small family ranchers get a fair shake.  The issue
     will continue to get attention.  I remain concerned that in
     agriculture, as in other key industries, concentration will produce
     adverse social and economic results for mainstream Americans -- it
     will continue to be a high priority.
     Together, we pried open door after door around the world. We'll be
     carrying that crowbar for some time to come, but already our progress
     is measurable. This past year, we exported 19% more U.S. beef than
     ever before in history.
     Of course, this doesn't mean that America's cattlemen and women didn't
face far more than their fair share of hardship:
The drought in the Southwest Plains and the blizzards in the Dakotas
     The fallout from BSE in Europe and E. coli in Japan -- tragedies of a
     scale that won't ever occur on American soil as long as we keep
     putting safety first ...
     The challenge of a combination of low cattle prices and record-high
     grain prices ...
     This was not an easy year.
DAKOTA BLIZZARDS
     Right now, USDA's working hard to help ranchers in the Dakotas. It's
warming up now, but they still need our help. As I speak, our Deputy
Secretary Rich Rominger is out there to see first-hand the damage and report
back. Dakota ranchers won't have to brave the elements alone. USDA will be
there as long as we are needed. We are announcing some emergency disaster
assistance today.
     But there is a broader issue looming on the horizon. I read in the
paper recently that the National Weather Service has stopped referring to
rare weather catastrophes as  100-year events.' Why? They're happening too
often!
     Lately, we've seen an increase in extreme weather conditions, and it's
taken its toll on our grain reserve -- which is our only source of funds for
livestock assistance. We started 1996 with about 45 million bushels of
government-owned feed grain. We sold 15 million to help out during the
Southwest drought. We'll use more for the Dakotas. So in less than a year,
we've gone through well-over a third of our reserve.
     So I think we need to ask the obvious question: What do we do when the
reserve runs out?
     In last year's Farm Bill, Congress eliminated the Emergency Livestock
Program. Maybe that was a wise decision, maybe it wasn't. But one thing is
certain: We need a permanent system to help cattle ranchers in crisis. And
we should figure it out now, rather than waiting until we're in a position
where disaster strikes and we're powerless to respond.
     If extreme weather patterns continue, that's a position we could be in
within 2 years. So we need to start the dialogue now. We may not be able to
duck Mother Nature when she's angry, but with proper planning, we can
significantly soften her blows.
TRADE
     Disaster aid is part of a much larger umbrella issue in agriculture
today -- risk management. How can farmers and ranchers get sufficient
shelter -- whether it's from a powerful blizzard or a weak market? One long-term solution is to expand the size of the market.
     While the U.S. population has remained relatively stable, world
population is growing faster than ever. Rising incomes in Asia, Latin
America and Eastern Europe are translating into more money for food and an
increasingly Western palate, including an increased appetite for red meat.
     As we stand on the cusp of a new century, there's a world of
opportunity out there in front of us.
     That's why President Clinton and this Administration have been so
aggressive on trade. We've opened up more foreign markets than any
Administration in history. As a result, U.S. agriculture is now America's #1
export. Not cars, not computers, American agriculture is #1. We send out
more than $1 billion in food and fiber every week, and record high farm-incomes are our reward.  While sales of bulk commodities will show a small
decrease, value-added products like beef will continue to increase.
     I know when it comes to good news -- especially good economic news --
politicians like to take all the credit. But when it comes to our trade
success, a lot of credit is due to this organization and others like it that
had the courage and foresight to support freer trade.
     It doesn't win any popularity contests, but it should. Just look at
beef: In 1990, before NAFTA and our bilateral agreements with East Asia, we
exported about $1.6 billion in beef every year. 5 years later -- after we
opened the doors -- we exported $1.7 billion -- to Japan alone. That's an
unprecedented leap, and there's room to go much, much higher.
     Of course, you wouldn't know that from listening to talk radio. But
I'd encourage you to also listen to each other ... listen to ranchers whose
cattle helped drive last year's $2.6 billion in beef exports. Beef and veal
exports to Mexico alone jumped up nearly 80 percent.  With strong world
economic growth in 1997, we expect beef exports to resume the record growth
of the  90s.
     So it disturbs me to hear that some in cattle country want to pull the
plug. They say,  we're better off without free trade. Let's rebuild our
walls and go back to the past.'
 I can't imagine a more destructive path.
     Why? The laws of gravity apply here. What goes up, must come down. If
we don't export our beef, domestic supplies go up. What comes down? Prices.
     We shouldn't fear freer markets. We're the most competitive nation in
the world. We have the safest, highest quality beef in the world. So we
should see the world for what it is -- 96 percent of our potential customer
base. The question is not whether free trade is a good idea. The question
is: What more can we do to ensure that free trade is fair? The answer is
plenty.
CHINA
     We need to make sure that countries that join our trading alliance
play by the rules. 1997 could be the year China finally enters the World
Trade Organization -- whether they do is largely up to them. They're our
largest and fastest-growing market. If they agree to lower trade barriers
and allow competition, it would be a tremendous opportunity. If they don't,
it would be a disaster. They'd be the bull in our china shop, shattering the
fragile fairness we've established with our trading partners.
     So China will enter the WTO on these terms or not at all. And when we
make that decision, we should be certain that they're serious about keeping
their commitments. As a sign of good faith, China should start bringing down
their barriers now ... and not just for CDS and stereos, but beef and other
agricultural products as well. Otherwise, to borrow a phrase from our Texas
friends,  they're all hat and no cattle,' and that's no way to make a major
change in world trade.
     Agriculture has got to be in the mix of China negotiations. I promise
all of you today: I'll fight to make sure that it is.
HORMONE BAN
     It's an important fight ... economically for our producers, but also
for the future of free trade. If we don't take a stand for fairness, for
sound science, and for an unbiased resolution of our disputes, then we'll
just glide back into protectionism.
     We see that now with phony science trade barriers. Remember when South
Korea tried to keep out our premium-cut meats? They didn't want us in their
markets. Because of our trade agreements, they couldn't say that, so they
developed ridiculous shelf-life restrictions. They had nothing to do with
science, and everything to do with protectionism. They knew it. We knew it.
     So we took them to the WTO and won. In 1996 alone, that victory
translated into a quarter of a billion dollars in U.S. meat exports to
Korea.
     So we know the process can work. The next big test will be the
European Union's ban on beef from cattle raised using hormones. Study after
scientific study has shown this beef to be perfectly safe. What that means -- thanks to the GATT agreement -- is that all of you have a right to compete
in European markets. That's a right we've been denied for 8 years. If the
WTO sticks to sound science, we'll see this unfair policy reversed.
VETERINARY EQUIVALENCY
     Another priority for this Administration is veterinary equivalency.
Any scientist worth their salt will tell you that our meat and poultry
inspection system is as good as any in the world. Yet the EU is demanding
that we change it to mimic theirs -- all the way down to where we locate
bathrooms in our plants and what color we paint the walls. I'm serious. It's
that ridiculous.
     What this means to you is that come April 1, our exports could be
disrupted if we don't adopt European procedures. What we need to do -- what
it would be fair to do -- would be to have our scientists sit down, go
through our inspection plans, and come up with an agreement that recognizes
that while our systems are different, they ensure an equivalent standard of
safety for our people.
     This month, USDA put all EU nations on notice that come April 1, if
there is no agreement, the United States, too, will have no choice but to
raise serious scientific questions about European inspections. So we've made
it crystal clear to the EU that equivalence is a two-way street. We can
nickel and dime each other to death, but that should be unacceptable to both
of us.
     Clearly it's in both our interests to have our scientists sit down now
and work this through in advance of the deadline. We can do it. We owe it to
our producers.
     There are other challenges as well: We need to make the flow of live
cattle between the U.S. and Canada more of a two-way street. We need to
resolve this issue of individual states grading beef in Mexico. It's a
problem, and we need to eliminate it.
CONCLUSION
     John Kennedy used to say,  When written in Chinese, the word crisis is
composed of two characters. One represents danger and the other represents
opportunity.'
     I was recently reminded of this lesson by a young girl in Fargo, North
Dakota. I heard a story about her on the radio this week. Evidently, last
Saturday, the wind chill climbed back up to a relatively balmy 40 below.
Most of us would take one look at the snow and climb back under the covers,
but not this little girl. She opened the door, looked outside and saw that
world of opportunity. She put on her warmest clothes, hauled out her wagon,
and went door to door selling Girl Scout cookies ... Bet she made a bundle,
too.
     American agriculture's hardly snowed under. There are challenges
ahead, but they're overshadowed by tremendous possibility. We can seize it
together. If we build on the strong relationship we've had, we'll head into
a new century ripe with promise and help write a bright new chapter in
American history.
     Thank you, and congratulations on another successful convention.
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