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81–659 PDF 2002

S. HRG. 107–652

THE NEW FEDERAL FARM BILL

HEARING

BEFORE THE

COMMITTEE ON AGRICULTURE,

NUTRITION, AND FORESTRY

UNITED STATES SENATE

ONE HUNDRED SEVENTH CONGRESS

FIRST SESSION

JUNE 28, 2001

Printed for the use of the

Committee on Agriculture, Nutrition, and Forestry

(

Available via the World Wide Web: http://www.agriculture.senate.gov

COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY

TOM HARKIN, Iowa, Chairman

PATRICK J. LEAHY, Vermont

KENT CONRAD, North Dakota

THOMAS A. DASCHLE, South Dakota

MAX BAUCUS, Montana

BLANCHE L. LINCOLN, Arkansas

ZELL MILLER, Georgia

DEBBIE A. STABENOW, Michigan

BEN NELSON, Nebraska

MARK DAYTON, Minnesota

PAUL DAVID WELLSTONE, Minnesota

RICHARD G. LUGAR, Indiana

JESSE HELMS, North Carolina

THAD COCHRAN, Mississippi

MITCH MCCONNELL, Kentucky

PAT ROBERTS, Kansas

PETER G. FITZGERALD, Illinois

CRAIG THOMAS, Wyoming

WAYNE ALLARD, Colorado

TIM HUTCHINSON, Arkansas

MICHEAL D. CRAPO, Idaho

MARK HALVERSON, Staff Director/Chief Counsel

DAVID L. JOHNSON, Chief Counsel for the Minority

ROBERT E. STURM, Chief Clerk

KEITH LUSE, Staff Director for the Minority

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(III)

C O N T E N T S

Page

HEARING(S):

The New Federal Farm Bill .................................................................................... 01

Thursday, June 28, 2001

STATEMENTS PRESENTED BY SENATORS

Harkin, Hon. Tom, a U.S. Senator from Iowa, Chairman, Committee on

Agriculture, Nutrition, and Forestry .................................................................. 01

Lugar, Hon. Richard G., a U.S. Senator from Indiana, Ranking Member,

Committee on Agriculture, Nutrition, and Forestry ......................................... 04

Allard, Hon. Wayne, a U.S. Senator from Colorado ............................................. 12

Baucus, Hon. Max, a U.S. Senator from Montana ................................................ 07

Conrad, Hon. Kent, a U.S. Senator from North Dakota ...................................... 05

Crapo, Hon. Michael D., a U.S. Senator from Idaho ............................................ 14

Dayton, Hon. Mark, a U.S. Senator from Minnesota ........................................... 20

Fitzgerald, Hon. Peter G., a U.S. Senator from Illinois ....................................... 24

Hutchinson, Hon. Tim, a U.S. Senator from Arkansas ........................................ 08

Leahy, Hon. Patrick J., a U.S. Senator from Vermont ......................................... 10

Lincoln, Hon. Blanche L., a U.S. Senator from Arkansas .................................... 35

Miller, Hon. Zell B., a U.S. Senator from Georgia ................................................ 13

Nelson, Hon. Ben, a U.S. Senator from Nebraska ................................................ 37

Roberts, Hon. Pat, a U.S. Senator from Kansas ................................................... 16

Stabenow, Hon. Debbie A., a U.S. Senator from Michigan .................................. 15

Thomas, Hon. Craig, a U.S. Senator from Wyoming ............................................ 06

WITNESSES

Carter, David E., Secretary–Treasurer, Mountain View Harvest Cooperative,

Longmont, Colorado ............................................................................................. 41

Cox, Craig, Executive Vice President, Soil and Water Conservation Society,

Ankeny, Iowa ........................................................................................................ 29

Daly, Sharon, Vice President for Social Policy, Catholic Charities,

USA, Alexandria, Virginia ................................................................................... 38

Fluharty, Charles W., Director, Rural Policy Research Institute, Columbia,

Missouri ................................................................................................................ 27

Glenn, Barbara P., Member, Board of Directors, National Coalition for Food

and Agricultural Research, and Executive Vice President, Federation of

Animal Science Societies, Bethesda, Maryland ................................................. 33

Learner, Howard A., Executive Director, Environmental Law and Policy

Center of the Midwest, Chicago Illinois ............................................................. 31

Stallman, Bob, President, American Farm Bureau Federation, Washington,

DC .......................................................................................................................... 25

Swenson, Leland, President, National Farmers Union, Washington, DC .......... 21

APPENDIX

PREPARED STATEMENTS:

Lugar, Hon. Richard G. .................................................................................... 54

Crapo, Hon. Michael D. .................................................................................... 59

Page

IV

PREPARED STATEMENTS—CONTINUED

Dayton, Hon. Mark ........................................................................................... 64

Fitzgerald, Hon. Peter G. ................................................................................. 73

Lincoln, Hon. Blanche L. ................................................................................. 75

Miller, Hon. Zell B. ........................................................................................... 55

Stabenow, Hon. Debbie A. ............................................................................... 62

Carter, David E. ............................................................................................... 205

Cox, Craig .......................................................................................................... 163

Daly, Sharon ..................................................................................................... 199

Fluharty, Charles W. ........................................................................................ 151

Glenn, Barbara P. ............................................................................................. 180

Learner, Howard A. .......................................................................................... 174

Stallman, Bob ................................................................................................... 130

Swenson, Leland ............................................................................................... 78

DOCUMENT(S) SUBMITTED FOR THE RECORD:

Daschle, Hon. Tom ........................................................................................... 210

The American Dietetic Association ................................................................. 230

California Association of Winegrape Growers ................................................ 241

Children’s Defense Fund: Food Stamp Program ............................................ 234

EIR News Service, prepared by Robert L. Baker and Marcia M. Baker ..... 211

Graves, David, National Council of Farmer Cooperatives ............................ 244

Heissenbuttel, John, Vice President for Forestry and Wood Products ........ 218

QUESTIONS AND ANSWERS:

Questions for Craig Cox ................................................................................... 253

(1)

THE NEW FEDERAL FARM BILL

THURSDAY, JUNE 28, 2001

U.S. SENATE, COMMITTEE ON AGRICULTURE, NUTRITION AND FORESTRY, Washington, DC.

The committee met, pursuant to notice, at 9:05 a.m., in room

SD–106, Dirksen Senate Office Building, Hon. Tom Harkin, [Chairman of the Committee], presiding.

Present or Submitting a Statement: Senators Harkin, Leahy,

Wellstone, Conrad, Baucus, Lincoln, Miller, Stabenow, Dayton, Nelson, Lugar, Roberts, Fitzgerald, Hutchinson, Allard, Thomas, and

Crapo.

STATEMENT OF HON. TOM HARKIN, A U.S. SENATOR FROM

IOWA, CHAIRMAN, COMMITTEE ON AGRICULTURE,

NUTRITION, AND FORESTRY

The CHAIRMAN. The Committee on Agriculture, Nutrition and

Forestry of the U.S. Senate will come to order.

I would first like to take this opportunity to welcome my colleagues, as well as our witnesses and members of the audience, to

the first hearing in this committee on the 2002 Farm bill, basically,

as we move ahead to structure it.

In particular, I want to thank Senator Lugar for his courtesy and

consideration during the time that he served as chairman. I just

want you to know, Senator Lugar, I look forward to continuing the

same type of cooperative working relationship that we have thus

far had. I want to thank you for your leadership, and I look forward to more of your leadership on this committee as we work together in this endeavor on a new farm bill.

What I would like to do is proceed. I will make a short opening

statement and then I would yield to Senator Lugar, and then we

will just go back and forth for opening statements from Senators,

hopefully to keep them at least under 10 minutes. I will try to keep

mine under 10 minutes, and then we will go to our first panel. I

know we have two votes at 9:45, so we will take a short recess from

around 9:45 until about 10:00. Then we will come back and complete the hearing.

As we work to formulate and draft a new farm bill, we must keep

in mind that it is one of the most important pieces of legislation

that Congress deals with. The Farm bill is, of course, critically important to farm and ranch families, but also to the well-being of all

Americans, whether they are rural or urban areas. The bill covers

a wide range of topics, from farm programs, to conservation, agricultural trade, research, nutrition and rural economic development.

2

Today’s hearing is part of what will be a busy schedule of hearings over the next several weeks. In these hearings, we will have

an opportunity to cover in more depth the many issues in the various parts of a comprehensive farm bill. Because the Farm bill is

so important to all of our Nation, we need a comprehensive farm

bill.

Some of us on the committee have been through a number of

farm bills; others may yet have to endure their first. During my career in Congress, I have been involved in the writing of five farm

bills, starting with the 1977 bill, the 1981 Farm bill, the 1985,

1990, and 1996. In many ways, the fundamental challenges and

problems are similar from year to year, but our understanding and

our approaches change over time.

We must keep in mind that our responsibility is to write a farm

bill that will look ahead rather than try to fix the problems or settle the issues of the past. Without a doubt, the new Farm bill must

recognize 21st century realities and the fact that we live in an increasingly competitive global food and agricultural system. However, at the same time I believe we are also seeing around the

world a deepening appreciation of the value of farms and ranches

and local communities, and the critical need to promote their survival and prosperity.

Fundamentally, we must seek to help agricultural producers

earn a better return and a better return of the consumer dollar in

the market. That applies to corn, soybean, wheat, cotton and rice

producers, just as it does to pork, beef, dairy, poultry or specialty

crop producers. We must help rural communities share in the economic growth, job creation and prosperity that our Nation in general has enjoyed over the years.

In short, we need to keep what has worked in past farm bills,

including the last one, and improve what has not worked. The

planting flexibility and increased support for conservation in the

last Farm bill were successes. The bill’s income enhancement was

not, so we need to improve the system of farm income enhancement, I believe, in the next Farm bill.

To be sure, the large amounts of cash assistance to agriculture

in recent years have been critical to the survival of thousands of

farms and ranches across our country. I, along with others, have

worked hard to obtain that assistance in the appropriations bills.

Yet, we all know that this heavy reliance on Government payments

is not a healthy or sustainable agricultural policy into the future.

Again, we must look to creating opportunities and hope for the future, not just a continuation of the status quo.

One of the greatest contributions to our society by farmers and

ranchers is their age-old stewardship of our natural resources. As

we formulate new farm policies for the 21st century, conservation

should be a crucial part of our work. We must start, I believe, by

adequately funding and strengthening our existing USDA conservation programs. I believe we can do more.

We have before us bipartisan legislation, the Conservation Security Act, to support conservation on lands that are in agricultural

production. The bill would do so through a totally voluntary program of incentive payments for conservation practices. The more

conservation applied to the land, the higher the payments. The proVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00006 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
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gram is very flexible and suited to individual farms and ranches

and local priorities. It is not top-down or one-size-fits-all. Since it

is not based on price or production, it falls within the WTO ‘‘green

box’’ as not being trade-distorting. Finally, this legislation helps all

regions of the country and all types of producers, including growers

of fruits and vegetables and specialty crops.

On another topic, we have only scratched the surface of developing farm-based sources of renewable energy—ethanol, bio-diesel,

biomass, wind, methane, hydrogen. Agriculture in this century

should be more than just about food and fiber. Anything we can

produce from a barrel of oil, we can produce on our farms. We do

not have to drill for oil in environmentally pristine areas, nor do

we have to be at the mercy of foreign oil producers.

The potential is huge all around the country: ethanol from grains

or biomass of various sorts and kinds; bio-diesel from soybeans or

any kind of oilseeds, or even from animal byproducts. I know that

we hear the arguments that renewable fuels are too expensive, but

I maintain they are not too expensive when we consider all the

extra costs of our dependence on fossil fuels, including military

costs of protecting foreign oil and the environmental costs of using

fossil fuels.

A sound farm economy is essential to healthy rural communities,

but it is not in and of itself sufficient. We also need to include in

the next Farm bill policies that will help to improve economic opportunities and the quality of life in rural communities. We must

honestly face the fact that farm families are relying more and more

on off-farm income. We must help communities obtain the basic

amenities—water, waste water, transportation, health care, education, telecommunications. In addition, we should help them gain

access to the capital, the know-how and the markets that will promote economic growth and new jobs. I see tremendous potential for

local and farmer-owned value-added businesses if they receive the

help they need to get up and running.

Finally, our committee cannot neglect its responsibility to fight

hunger and malnutrition in our country and elsewhere in the

world. We must ensure we have a solid system of food assistance

in the U.S., and we should do more in developing countries. In particular, I hope that we will soon pass the McGovern-Dole legislation to create an international school nutrition program.

These are, I believe, the highlights of the components of a new

farm bill. The specifics of the various commodities and other programs, such as dairy and crop insurance and others, will have to

be dealt with and integrated into this bill. We have a lot of work

to do.

We are fortunate to have on this committee, on both sides of the

aisle, Senators with a deep understanding of and support for agriculture, our farm families and rural America. I am proud to serve

with each of you and look forward to the task ahead.

With that, I will yield to my distinguished ranking member and

my good friend, Senator Lugar.

4

STATEMENT OF HON. RICHARD LUGAR, A U.S. SENATOR FROM

INDIANA, RANKING MEMBER, COMMITTEE ON

AGRICULTURE, NUTRITION, AND FORESTRY

Senator LUGAR. Thank you, Mr. Chairman. I simply want to

start by congratulating you again on your assumption of the chairmanship. I appreciate the fact that our staffs have worked well in

coordinating any transitions that were required, and I would just

make that assurance to all of our friends from farm country today

that the need for bipartisan cooperation as we try to do this complex farm bill is imperative. You certainly will have our support

and I congratulate you on your statement.

I would mention, as the chairman knows, that we had a running

start on the Farm bill with our hearings, in which the chairman

and members vigorously participated, on the credit, research, trade

and conservation titles. The Farm bill will probably include titles

that are dedicated to each of those topics and others, as staffs have

been working on that.

I look forward to working with you on a comprehensive farm bill

which I hope we will be able to enact swiftly that ensures the full

opportunity for the farmers that you have mentioned, and likewise

allows farmers, ranchers, consumers and taxpayers to be heard

during these hearings.

Mr. Chairman, while our domestic markets and commodity programs are extremely important and must be reviewed and revised,

foreign markets are vital to the health and viability of United

States agriculture. I would suggest that any final farm bill legislation could be overshadowed in significance by the ultimate congressional decision on trade promotion activity either way. The foreign

markets expand and our prosperity increases. Likewise, when the

foreign markets contract, we have supplies up around our necks.

It is critical that trade promotion authority be our highest trade

and foreign policy priority, at least in terms of agriculture in this

country. Ninety-five percent of the world’s consumers of food and

fiber live outside of our borders, and the viability of United States

agriculture depends on our ability to have access to those markets.

Although some trade bills have been enacted without trade promotion authority, negotiating trade agreements with other countries is not only more difficult and more uncertain; it may be in the

current context virtually impossible without trade promotion authority. Other countries will engage in serious discussions only if

they know that the Congress will not second-guess and amend,

thus opening up the agreements to second-guessing and amendment by every other legislature around the world.

Agriculture is two-and-one-half times more reliant on trade than

the rest of our economy. Ag exports create and sustain hundreds

of thousands of American jobs and income in the non-farm sector.

To illustrate the importance of ag exports, I would ask that USDA

ag export facts and information on other sector exports for each

State represented on this committee for the 106th and 107th Congress be entered into the record. Such statistics are available and,

Mr. Chairman, for the record I will submit all of that so we will

have it as part of the record.

Senator LUGAR. I hope my colleagues will reflect on those figures

in terms of product moved overseas and jobs created. For example,

5

in my home State of Indiana 22,000 jobs are tied to ag exports, and

those exports account for 32 percent of all of our agricultural production. One-third has to be moved somewhere else outside Indiana

and the United States.

In Iowa, 48,000 jobs are tied to exports, and they account for onethird of the agricultural production in that State. 12,600 jobs in

Colorado and 33,400 jobs in Minnesota are in the category of being

supported by ag exports. They are serious figures which underscore

my conviction that this Congress must act on trade promotion authority now rather than later.

I thank you again, Mr. Chairman, for calling this timely hearing

with a comprehensive set of witnesses today and we look forward

to each of the ensuing opportunities.

Thank you.

[The prepared statement of Senator Lugar can be found in the

appendix on page 54.]

The CHAIRMAN. Thank you very much, Senator Lugar, and again

I want to thank you for your great leadership and look forward to

working with you. You are right; this has to be a bipartisan approach. It has been in the past and I am certain it will be again

this year.

Now, I would like to turn to the Senator from North Dakota,

Senator Kent Conrad.

STATEMENT OF HON. KENT CONRAD, A U.S. SENATOR FROM

NORTH DAKOTA

Senator CONRAD. Thank you, Mr. Chairman, and I too want to

add my words of congratulations to you as you take on the chairmanship of this important committee at this critically important

time.

I also want to congratulate you for the swiftness of the action

and the leadership you have provided. We don’t even have an organizing resolution yet in the U.S. Senate, but already you have an

organized the first hearing with an outstanding panel of witness.

It is very clear that your leadership is being expressed and you are

moving rapidly, and I am just delighted, Mr. Chairman. Thank

you.

Also, I want to thank you for your statement because you have

put the emphasis right where it belongs. What are we going to do

for the future to strengthen farm income for families all across our

country? We can look to the past and we can talk about a failed

farm policy. Clearly, it has failed. We have had to write disaster

bills each of the last three years, economic disaster bills, because

of a disastrous farm policy. There are parts of that policy that are

good. It is good to have flexibility to plant for the market rather

than a farm program. That is something we ought to retain in a

new farm policy.

I also think you have properly put a focus on conservation because as we look at this world trading system, it is going to be

critically important that we have programs that are in the so-called

‘‘green box,’’ and you have correctly identified the opportunity to do

that in this Farm bill.

I have a few charts here to illustrate some basic facts. While

farmers pay more for everything they buy, they are receiving less.

6

The green line is what farmers are paying for inputs, and that has

gone up, up, up, and with the latest energy price shock it has become even more serious.

On the other hand, the red line shows what prices farmers have

received for the goods that they sell. It is interesting that the peak

was when the last farm bill was written. Since then, it has been

almost a straight line down, and that tremendous chasm between

the prices that farmers receive and the prices that they pay has

created the farm crisis.

Mr. Chairman, the other thing we have to be ever mindful of as

we write this Farm bill is our competitive position in the world, because our major competitors, the Europeans, are far out-stripping

us in support for their producers. This shows, according to the Organization for Economic Cooperation and Development, who are

the international scorekeepers, that on average the Europeans are

providing $313 an acre of support, while we provide $38 an acre.

I want to show a chart on what they are doing on export support

because the picture is the same. Europe is the blue part of this pie

and they account for 84 percent of all world agricultural export

subsidy—84 percent. We in the United States account for that thin

sliver there in red, 2.7 percent. They are out-spending us 30 to 1.

This is not a level playing field. It is no wonder that our farmers

are facing hard times, and it is imperative that we fight back and

this hearing is the beginning.

Again, I want to congratulate you, Mr. Chairman, and thank the

ranking member as well because he has given us a running start

by holding hearings. You have followed up swiftly and in an important way, and we appreciate the leadership the two of you provide,

and again especially you, Mr. Chairman, for your actions here

today.

The CHAIRMAN. Thank you very much, Senator Conrad, and I

just want to reciprocate in kind by congratulating you on your

chairmanship of the Budget Committee and for ringing the alarms

and letting us know the problems that we are confronting down the

pike and why we have got to move on this Farm bill rapidly and

expeditiously to make sure that we are able to enact the policies

that will increase farm income within the confines of that budget.

I personally want to thank you for alerting everyone as to what we

have to do. I really appreciate that.

Next, I would go to Senator Thomas.

STATEMENT OF HON. CRAIG THOMAS, A U.S. SENATOR FROM

WYOMING

Senator THOMAS. Thank you, Mr. Chairman. I am pleased to be

able to be here today. All of you have talked about the number of

times you have been through this. I have been involved in agriculture all my life, but it is the first time I have been involved in

this committee with respect to the Farm bill, so it is an interesting

experience for me.

I notice in the announcement for the meeting and some of the

statements talking about the next Farm bill. Of course, that is specifically what we will be doing, but I hope that is not where we

focus entirely. You all have mentioned it, but it seems to me our

real challenge is to look forward in the future as to what we want

7

agriculture to be, and then this Farm bill ought to move us toward

that direction.

We have gotten, it seems to me, again from outside the committee, totally involved in the local and immediate questions which obviously have to be answered, mostly on payments and money, and

so on, instead of looking at where we want agriculture to be 10

years from now, 20 years from now. I hope each of you will take

a look at that and talk about where we need to be.

I personally hope, of course, we can move to more of a marketbased system. Most people agree to that. It is a difficult thing to

do. We have tried to do that. There are other obstacles, in addition

to the Farm bill. They have to do with tax burdens and environmental restrictions and market concentration and trade barriers,

and all those kinds of things.

I will submit my statement, Mr. Chairman. I don’t want to take

long, but I just want to emphasize again that we have to have a

vision of where we want to be so that what we do here contributes

to attainment of that vision. Otherwise, we will be back here next

year looking at the same thing in short term and talking mostly

about which programs we are going to fund and how you distribute

the available money, which is an important element. I understand

that, but it doesn’t move us toward where we want to be over time.

I appreciate the opportunity. Thank you, sir.

The CHAIRMAN. Senator Thomas, thank you for your statement,

and I would just say I couldn’t agree with you more.

I turn now to my good friend, the Senator from Montana, Senator Baucus.

STATEMENT OF HON. MAX BAUCUS, A U.S. SENATOR FROM

MONTANA

Senator BAUCUS. Thank you, Mr. Chairman. I deeply appreciate

your calling this hearing. It is desperately needed. I will submit my

statement for the record.

It is stating the obvious when I say this is a very difficult challenge ahead of us, and it is ironic that some peoples in the world

are starving even though there is a glut of commodities in the

world, and it is tragic. The cause for that disparity is really much

more political than anything else; that is, it is the politics in the

local areas that prevents food from getting to the people who need

it.

When the United States and other countries give aid, it is the

warring factions in the particular part of the world that prevent

the food from getting to the people. Yet, we in the United States

produce so much food. Something is not right.

Now, on our end of this, our producers, too, even though we

produce so much, clearly are not getting a fair return. The problem

has been getting worse over time, not better, with costs going up

and prices in real terms, at least in wheat, essentially declining.

Clearly, a farm bill can help address the problem, and clearly we

have to revisit Freedom to Farm.

We can do a lot in a farm bill. We can do a lot in the Farm bill,

and we must. A safety net must be provided, stability, predictability, better assured. We must also recognize that much of our

work has to do with international arena. Senator Conrad did an exVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00011 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
8

cellent job, and has many times demonstrated the degree to which

other countries subsidize their production much, much more than

do we, and particularly the European Union in its subsidies of exports much more than do we in the United States.

There is another WTO round, and it is in services and it is also

in agriculture. We know the challenge. It is huge, and we must find

leverage, frankly, if we are going to get any results in the next

round. That is a large part of it and it requires a lot of new thinking, too. The world is changing so dramatically.

You know, it is interesting. Often, Pentagons and defense establishments get ready for the last war, and when we write a farm

bill, we can’t write a farm bill for the last farm war, the last set

of problems that we were facing at the time. We have to look much

more in the future and be very honest about what is happening to

production agriculture and what is happening in the world.

I don’t know the answer. I only ask all of us, and I know all of

us, including all the groups, will dig down even more deeply and

more creatively, and maybe on some pilot project basis try something new, try something different. We have no choice; we have to,

because the trend that we have been experiencing is on the decline.

If we write another farm bill basically under the same old ways,

my guess is this trend is going to continue. That is the way we

have been doing things.

I would just say to all of us we have a great opportunity here.

It is an awesome challenge, and I ask all of us to step up to the

plate and come up with some really significant, honest solutions.

It is not going to solve the whole problem, but at least it will be

a good start.

Thank you, Mr. Chairman.

The CHAIRMAN. Thank you very much, Senator Baucus.

Senator Hutchinson.

STATEMENT OF HON. TIM HUTCHINSON, A U.S. SENATOR

FROM ARKANSAS

Senator HUTCHINSON. Thank you, Mr. Chairman, and let me join

my colleagues in expressing my appreciation for your calling this

hearing and for moving ahead with rewriting of the Farm bill.

That is the number question I receive in farm country, in Arkansas. I was in the delta this past weekend and the question was,

when are you going to write the Farm bill? Are you going to get

it done this year, next year? What is it going to look like. I very

much appreciate you moving even before we get that reorganization

resolution completed.

I also appreciate, Mr. Chairman, your leadership on the whole

issue of conservation incentives for land that is in production.

While we must continue our efforts on WRP and CRP, your leadership and others’ who are very concerned that we provide those incentives for conservation for that land that is in production is very

worthwhile. I commend you for that and look forward to working

with you on that.

I also appreciate your comments regarding the potential of biodiesel. I have been pleased to work with Senator Dayton on that

issue in introducing legislation to try to provide incentives similar

9

to the ethanol program for bio-diesel, and I look forward to working

with you in seeing that as part of this new farm bill.

Senator Lugar’s comments regarding the importance of exports

and doing more in the area of trade are essential as well. As I look

at the State of Arkansas, I don’t know exactly where we would

rank in population, but we are 11th in the Nation in agricultural

exports. The future of agriculture in Arkansas is directly related to

what we can do in increasing export markets. Senator Conrad emphasized that as well, and that is very important.

Senator Conrad also accurately pointed out, and I want to underscore, the plight of farmers today. With commodity prices as low in

many areas as they have been since the 1930’s, and with costs of

production at record highs and being exacerbated by fuel costs

today, farmers are hurting. They are certainly hurting in the State

of Arkansas. Many have either given up their land or are farming

up what is left of their assets in order to stay in business, and that

is not a viable situation.

The other question I get asked all the time is are we going to

get the second AMTA payment out. I hope that the Congress will

move expeditiously on getting an AMTA payment out at the 1999

level.

We need to get a farm bill written to establish certainty, stability

and predictability. The ad hoc, 1-year-at-a-time emergency bills is

no way to run a farm program. I join my colleagues in that estimation, in that very strong feeling.

I commend you again for the hearing today and for moving ahead

with the writing of a new farm bill. Thank you.

The CHAIRMAN. Thank you very much, Senator Hutchinson. I

look forward to working with you, especially on that bio-diesel

issue.

It will be the Chair’s intention that in all hearings that I chair

we will recognize Senators in the order in which they appear, except for perhaps today, and with two other exceptions, of course,

that the Chair will recognize whenever they arrive the two Chairmen Emeritus of this committee, both the ranking member and

Senator Leahy.

This has got to be another one of these firsts. This has got to be

the first time that a chairman of a full committee sits between two

former chairmen of a committee, one on either side of me. I don’t

think that has ever happened before here, but I am pleased and

honored to sit here.

With that, I would recognize the former, before Senator Lugar,

chairman of the Senate Agriculture Committee who led us greatly

in those years, in the late 1980’s and early 1990’s, and who has

been on the Agriculture Committee longer than maybe anyone

here, if I am not mistaken.

Senator LEAHY. Except Senator Helms.

The CHAIRMAN. Except Senator Helms. Senator Helms has been

here longer than Senator Leahy.

With that, I recognize my good friend from Vermont, Senator

Patrick Leahy.

10

STATEMENT OF HON. PATRICK J. LEAHY, A U.S. SENATOR

FROM VERMONT

Senator LEAHY. Thank you, Mr. Chairman. I must say that one

of the great delights of being on this committee is having served

with both you and Senator Lugar. You are two of my best friends

in the Senate and it has been good that way.

I might point out to some of the new members, when I first came

on here, there was a long, straight table back in the Russell Building. I am the very last person down there, and Senator Talmadge

and Senator Eastland puffing on huge cigars up at the front. Senator Eastland brings up an amendment about this thick, and Senator Talmadge says, well, then, without objection, it is accepted.

This was about my first meeting and I said, excuse me, could I

just ask what is in the amendment? The two cigars come down and

they look way down and they kind of say who is he? Talmadge

looks at me and he just raps the gavel and he says we are adjourned.

[Laughter.]

Senator LEAHY. Hubert Humphrey turned to me and he said—

and, Mark, you will appreciate this—Hubert Humphrey turns to

me and he says, now you understand what is in it. That was it.

[Laughter.]

Senator LEAHY. I don’t want to speak substantively. The Farm

bill should be completed this year because I don’t believe funding

can be available next year, and we run that real risk. The Farm

bill has to be comprehensive and national and fair to farmers in

all regions, and fair to all families living in rural areas, not just

farmers and ranchers.

‘‘Comprehensive’’ means the Farm bill has to more evenly provide benefits for those living in rural areas and protect consumers

in urban areas. ‘‘Comprehensive’’ means it does more than just

transfer billions of dollars from taxpayers to certain farmers in limited areas growing certain types of crops. It should enhance farm

land protection, conservation, small farm assistance, nutrition, and

so on, and ensure the safety of our food supply, the quality of the

water our children drink, the ability of our farm and ranch lands

to act as carbon sinks. It should enhance the bargaining position

of our farmers, who too often are given a ‘‘take or leave it’’ view

on prices.

The AMTA payments today concentrate the bulk of Federal assistance in the Midwestern States, leaving vast regions of the country with little assistance. Yet, the farmers in those other regions

also work hard. They produce their share of America’s abundance.

They have families to support. Farmers in the Northeast and MidAtlantic States, in particular, have been effectively shut out of

AMTA assistance.

In the crop insurance bill, I have been working with a coalition

of States and more than 20 Senators. We have informally become

known as the Eggplant Caucus. That comes from one of our MidAtlantic States. The number one specialty crop export in New Jersey is eggplant.

Let me put a chart up here just for a moment. The chart shows

how the $5.5 billion in fiscal year 2001 ag economic assistance

11

funds, funds being decided by this committee right now, would be

allocated under current AMTA payments. The darkest red area shows counties who receive more than $100

million in AMTA payments, and you can see where that is concentrated right in the center of the country. The light pink counties, such as those in the Northeast and Mid-Atlantic, are going to

get less than half a million. Based on the AMTA formula, farmers

from the dark red counties in the Midwest will receive 1,000 percent more than, for example, the farmers in my own State.

Now, the bottom shows what should be happening. Federal assistance payments should be distributed according to the value of

agricultural products. If you do that, you notice that the map

changes dramatically and it more accurately reflects where products are coming from. That is what we should do in constructing

the $5.5 billion package for fiscal year 2001 and for the 2001 Farm

bill.

You have got the cost-shared EQIP program that helps farmers

invest in their surrounding environment and protects their water

supplies. In Vermont alone, EQIP is oversubscribed by more than

5 to 1. That we have to talk about the $3.7 billion backlog we have

in environmental conservation programs and the farm land protection program so families can hold on to their property. We should

support the new, visionary conservation initiative developed by

Senator Harkin, the conservation security bill.

We need a strong nutrition component. We can’t be talking about

lowering WIC payments at a time when our economy may be slowing down, because after all the newly born child doesn’t really have

too much to say about how the economy goes, but we could have

a great deal to say about how he or she eats or what kind of nutrition the child’s pregnant mother has during the pregnancy.

These are things to look at, and I will do more for the record,

Mr. Chairman, but I wish everybody would look at that map because today, as I said, the heaviest concentration—is that North

Dakota?

[Laughter.]

Senator LEAHY. I read in the paper that they want to change the

name just to ‘‘Dakota,’’ Fort Knox, Dakota, up there.

Senator CONRAD. We kind of like this first map.

[Laughter.]

Senator LEAHY. I had the feeling you would.

I wish you would put that up behind Senator Conrad; I didn’t

want him to really see it, especially now that he is chairman of the

Budget Committee.

In fairness, take a look at that, and also keep in mind that these

Mid-Atlantic States and Northeastern States pay a very large part

of the bill for what is going into these Midwestern States. We get

very little back. We had one disaster bill where we got virtually

nothing back, and yet we had to pay about 80 percent of our taxes

for that.

We should be looking at something that more evenly distributes

it. It doesn’t hurt the Midwestern States. In fact, in a couple of

places it will actually improve the formula, but it more accurately

reflects where we are producing agriculture.

Thank you, Mr. Chairman.

12

The CHAIRMAN. Thank you very much, Senator Leahy.

Senator Allard.

STATEMENT OF HON. WAYNE ALLARD, A U.S. SENATOR FROM

COLORADO

Senator ALLARD. Mr. Chairman, I would like to join my colleagues in congratulating you on moving forward and becoming

chairman of the committee, and also on moving ahead with the

new Federal Farm bill. I appreciate being part of the panel.

I was a member of the Ag Committee over on the House side,

and I do think there were a lot of good things in the Freedom to

Farm bill. I hope that we can use that as a basis as we move forward. I do also realize that there are some changes that need to

be done to take into account safety net issues.

We need to look carefully at what we can do to expand our markets, particularly in the export areas, as Senator Lugar mentioned.

I also think that we need to look at renewables, which you mentioned in your comments. That is one area we can look to in order

to expand demand and markets for our agricultural products. We

need to look closely at crop insurance and taxes and also regulations on the farmers.

One area that I want to mention, which others have failed to

point out in their comments so far has to do with animal diseases

and plant health. As a veterinarian, you might very well expect me

to make those comments. That every member of this committee has

been seeing what has happened in Europe. That part of the world

has not paid as good attention as they probably should to animal

disease, and it has had a devastating impact on the livestock industry in Europe. The same thing can happen with plant diseases.

I hope that, as we move forward in our deliberations, we don’t

forget the important role that research and labs, such as the one

at Plum Island, which does this kind of work, as well as a lab that

you have in your State, in Ames, Iowa play. These national laboratories are key in what we are doing, particularly as far as animal

health is concerned.

Because of its importance, I will continue to push for an emphasis on research and make sure that we are putting in place a proper mechanism to protect our plant and animal industries from the

ravages of disease.

The CHAIRMAN. Thank you, Senator Allard. I am glad you are on

the committee. You are the first veterinarian since Senator Melcher was on the committee.

Senator LEAHY. That is right.

The CHAIRMAN. I believe that is right, and so I can just say in

my capacity as chairman I will turn to you often for advice and

consultation on these very crucial issues of animal health and animal diseases.

A lot of people are concerned about what is happening with hoofand-mouth disease, and so-called mad cow disease also. There is a

great deal of concern about animal safety, and with your expertise

and background, you can help us sort of weave through this as we

develop the new farm and I am really glad you are here.

Senator LEAHY. Mr. Chairman, do we follow the past precedents

of all us bringing any sick animals we have to markups?

13

[Laughter.]

The CHAIRMAN. Now, we turn to our good friend and a new member of the committee, the former Governor of the State of Georgia,

Senator Miller.

STATEMENT OF HON. ZELL MILLER, A U.S. SENATOR FROM

GEORGIA

Senator MILLER. Thank you, Mr. Chairman, and it is a pleasure

to be with this committee this morning as we take this first step

in what I know is going to be a long journey.

I know the minutes are ticking away, but I feel like I must respond to Chairman Leahy’s comments about Senator Talmadge, my

fellow Georgian. As one who has experienced that stare over the

top of his glasses and amidst the cigar smoke, it hit close to home.

In fact, when I went to the first Agriculture Committee meeting

and there were those grand portraits of yourself and Senator Talmadge in the committee room, I wrote Senator Talmadge a note

and told him that he was still in Washington and still looking over

my shoulder.

Senator LEAHY. He still votes, too, Zell, I just want you to know.

[Laughter.]

Senator MILLER. I do want to say, Mr. Chairman, before I get

into talking about some of the different aspects that are essential

to the new Farm bill that I hope that very soon we will begin to

move quickly on the supplemental package that our colleagues in

the House took up last week.

In past years, this committee has provided relief to farmers for

economic and natural disasters, and Georgia farmers are very

grateful for this. This year’s economic disasters are probably going

to outweigh those of past years and it is very important that we

move forward on that.

I will submit my statement, but let me just pull out a few of the

things that I did want to discuss.

There has been a lot of talk about the need for an adequate safety net for farmers in times of price and weather disasters, and certainly this is true. I do not believe that the current disaster policy

over the past few years can continue. No one knows what Mother

Nature will bring, but our farmers have a right to a program that

will provide them the security to continue their families’ farm operation and the comfort of knowing how and when the Government

will provide some assistance.

I also think it is crucial that we establish commodity programs

that will provide adequate funds for producers when prices are low.

I don’t think it is fair to punish producers with payment limits or

caps. Also, with the problems in today’s agricultural economy, reducing payments from the past levels is certainly not the answer.

Not every farmer produces the same crops, not every farm has the

same amount of acreage. Farmers want us to provide them flexibility to deal with their individual operations.

Also, Mr. Chairman, there is a strong need, I believe, to implement a specialty crop program. Specialty crops are a growing industry in my State and all around this country. They should be

given similar assistance to the major commodity programs.

14

Conservation certainly should be an important aspect of the next

Farm bill. Farmers understand this better than anyone how critical

a healthy environment is to the continuation of agriculture and the

general health of the community.

Over the past few years, Mr. Chairman, farmers have been hampered by numerous regulatory burdens, and this committee should

stress to regulatory agencies the requirement that judgments

should be based on sound science before drastic actions are taken

against farmers and agricultural industries. We must not give in

to the shrill minority intend on hurting this industry rather than

promoting it. Increased funding for agricultural research is vital for

this Nation to remain the leader in agricultural production.

Finally, we as a Congress should lend a hand, in my opinion, to

this administration in helping them open new trading opportunities. There are many untapped markets out there all throughout

the world, and I see no reason why the United States should not

be knocking on those doors and providing the goods so many foreign countries need and desire. I also remain very firm in my commitment that food and medicine should not be used as foreign policy tools.

Those are just some of the things that I have on my list of policy

decisions that we will debate in this committee. Mr. Chairman, we

have a daunting task ahead of us. I am excited that we are moving

forward in what is a new era in agriculture policy, and I look forward to working with you and my colleagues.

[The prepared statement of Senator Miller can be found in the

appendix on page 55.]

The CHAIRMAN. Thank you very much, Senator Miller, and we

are delighted to have you on the committee.

Now, we turn to Senator Crapo, from Idaho.

STATEMENT OF HON. MIKE CRAPO, A U.S. SENATOR FROM

IDAHO

Senator CRAPO. Thank you very much, Mr. Chairman. I also appreciate your holding this hearing and your interest in moving

promptly on a new farm bill.

Agriculture continues to drive Idaho’s economy and, as such, Idahoans have a keen interest in having a fair and efficient Federal

agriculture policy. Producers and processors and consumers, not to

mention the environment, are all very interested in this debate.

As we all know, farmers are hurting. Input costs have gone

through the ceiling and prices have dropped through the floor. In

many cases, the prices in Idaho are below the cost of production.

I am sure that is true in many other parts of the country.

A choice has to be made as to whether we want to continue to

support a viable and vibrant domestic agricultural policy in this

country, and I believe this committee has the opportunity to make

that choice. A safe, affordable, abundant supply of domestic food is

vital. The current energy problem serves as a warning to what we

could face nationwide in our food policy. It shows what happens

when we are subject to foreign supplies, proving that domestic production is a true matter of national security.

America’s farmers are the most efficient in the world and consistently produce the safest, highest-quality products in the world, and

15

our consumers directly reap the benefits of American agriculture

practices. As we work on this important legislation, we must not

lose sight of the fact that this is not just a farm bill, but it is a

national food policy that we are developing. Everybody benefits

from a vibrant domestic agriculture policy.

To this end, I look forward to working with you and our other

colleagues on the committee to make sure that we do provide an

adequate safety net to our producers; that we increase the commitment to conservation, and I too have been working on a number

of conservation items and would like to work with you directly on

that; to bolster our export promotion programs; to continue our

commitment to agricultural research; and to find innovative ways

to address rural development needs.

As those of us who worked on the 1996 Farm bill know very well,

the Farm bill alone will not solve all of our problems. We also have

to continue to pursue tax reform, to address unfair regulatory burdens, and move toward free and fair trade. Our producers are being

handcuffed by unfair competition and barriers to exports, and it is

time that we stop it.

Finally, I also want to say that while these long-term fixes are

vital and a comprehensive bill is needed before the next crop year,

our producers do need immediate help. Farmers are facing greater

difficulties than last year and we have to provide assistance now.

I look forward to working with you and my other colleagues to address these needs in our economic assistance package as well.

I will submit the rest of my statement for the record, Mr. Chairman, and thank you very much.

The CHAIRMAN. Thank you very much, Senator Crapo, and again

we are delighted to have you on this committee also from Idaho.

[The prepared statement of Senator Crapo can be found in the

appendix on page 59.]

Now, we turn to Senator Stabenow. I just want you to know that

I wore my Michigan tie this morning.

Senator STABENOW. Well, I am very appreciative, Mr. Chairman.

The CHAIRMAN. These are Michigan cherries right here.

Senator STABENOW. That is very good, and we want you to remember Michigan cherries, Mr. Chairman.

STATEMENT OF HON. DEBBIE STABENOW, A U.S. SENATOR

FROM MICHIGAN

Senator STABENOW. Thank you for the opportunity to be here

and, Mr. Chairman, for your leadership in pulling us together.

I want to first say thank you to former chairman Lugar for his

leadership in conducting the committee in a bipartisan manner,

and I know that our current chairman, Chairman Harkin, will do

the same. This is important to all of us that we develop a farm bill

that makes sense for American agriculture.

I would first just say that we all know that our farmers are

working harder than ever and earning less, and that is not in our

interest or theirs. I am hopeful that as we move forward we will

be creating policies to allow that hard work will result in strengthening family farms, as well as agriculture, in general.

Mr. Chairman, I will submit my statement for the record. I

would just indicate that in Michigan we grow a little bit of everyVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00019 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
16

thing. We have a lot of focus on dairy, and when we talk about animal disease I will just note that bovine TB is a critical issue for

us in Michigan.

We also have a lot of sugar beets, and you have heard me talk

many times about specialty crops, which will be a focus for me in

the Farm bill as we proceed to make sure that we are keeping an

eye toward specialty crops and the unique nature of specialty crops

in anything we do.

We are proud to have a premier research institution Michigan

State University, in Michigan, and obviously research is critical.

Conservation, in which the chairman has taken such tremendous

leadership, is very important. Food and nutrition, are important

and rural development—I am hoping to see us expand upon our

rural development efforts.

It is very exciting to be a part of this committee at a time when

we can focus on an energy title, which will be important for agriculture and for the country’s energy needs. Expanding markets is

certainly important as well.

Overall, I would just indicate that I appreciate the fact that we

are moving quickly. We need to be thorough, but we also understand that it is important to move forward and I appreciate the

chairman’s leadership.

Thank you.

[The prepared statement of Senator Stabenow can be found in

the appendix on page 62.]

The CHAIRMAN. Thank you very much, Senator Stabenow, and

we are honored and delighted to have you on the committee.

Senator Roberts, I just said a little bit ago this has got to be a

first, where I sit between two former chairmen. It has also got to

be a first, I have got to believe, where a committee has three

former chairmen of committees sitting on it.

I turn now to my good friend from Kansas, the Chairman Emeritus of the House Agriculture Committee and valuable member of

this Senate Agriculture Committee, one of the three former chairmen who sit on this committee, Senator Roberts.

STATEMENT OF HON. PAT ROBERTS, A U.S. SENATOR FROM

KANSAS

Senator ROBERTS. Thank you, Mr. Chairman. It is also noteworthy that it is a first that I am sitting to your left.

[Laughter.]

The CHAIRMAN. Do you want to keep it that way?

Senator ROBERTS. You never know on agriculture policy.

The CHAIRMAN. That is true.

Senator ROBERTS. I was going to start off by repeating some

names—Bob Pogue, Tom Foley, Kika de la Garza, Bob Smith,

Larry Combest, somebody named Roberts, Herman Talmadge, Pat

leahy, Dick Lugar, and now Tom Harkin.

I want to thank our distinguished former chairman, Senator

Lugar, for his spirit of cooperation and his bipartisan leadership as

we tackle the tough problems facing agriculture, and the ranking

minority member, Senator Harkin, who now has the privilege of

being chairman.

17

It was Kika de la Garza who said that everybody that is privileged to serve on the Agriculture Committee, like our farmers and

ranchers, can feel the ground; there is a special purpose, a special

calling, a special responsibility.

Tom, I know you feel that, and my heartfelt congratulations to

you and I look forward to working with you.

We certainly have our work cut out for us as we begin the task

of writing a new farm bill. I have been through six of them, as a

I counted them up, as a former staffer, a member of the House, and

now a member of the Senate. My godfathers in this business are

the Honorable Cliff Hope, Sr., who was a Republican chairman of

the House Ag Committee a long time ago; somebody by the name

of Bob Dole; Frank Carlson, a former Senator and Governor and

Congressman; and Keith Sebelius, who was my boss when I was

a staffer over on the House side. We have a lot of history in regard

to agriculture and what we believe in in Kansas and how we can

be of help.

As we begin this process, the first thing we need to do is to put

to bed the myth that a farm bill is only about our farmers and

ranchers and the commodity title. A farm bill is a bill for rural and

urban America. It is a bill to create a safety net that provides a

steady, stable income for our farmers and ranchers, and virtually

every dollar makes it back to Main Street and our rural communities.

We have all made the speech that the consumer in America

today spends only 10 cents of their disposable income dollar for

that market basket of food, thus freeing up 90 cents, if you will,

to spend for other essential items. It is not only a farm bill; it is

a bill for rural America, and certainly for urban America as well.

It is a bill to promote the conservation programs that protect not

only our most fragile land, but which also protects our water, air

and wildlife. The chairman has a unique initiative in that regard

in regard to legislation.

It is about rural development programs to provide our rural communities with the infrastructure and public facilities that many of

our city cousins simply take for granted.

It is about, as Senator Allard did point out, bolstering the research and education programs that ensure our producers have access to the best crop varieties, disease control methods, and the

technology to allow our rural communities to continue to move forward. It is a bill to preserve our economic foundation in the future

and way of life in our rural areas.

Now, we are not in very good shape with the shape we are in

in farm country. Times have been difficult in rural America in recent years. We have taken some short-term steps to address our

problems. Now, it seems to me we must face the difficult task of

writing a new farm bill.

We have a choice, Mr. Chairman. We can continue to focus primarily on the myriad of complex micro issues in farm program policy that usually put our colleagues into a high glaze after talking

to them for about one minute—all of the program details, all of the

parochial interests, and certainly we have heard about that this

morning, and loan rates, AMTA payments, deficiency payments,

loan deficiency programs, supply management, acreage reduction,

18

and so on and so forth, as we have done for the past 3 to 5 years.

Or we can make every effort to try to work together to come up

with a product that will improve farm income and sustain agriculture over the long term.

It seems to me we spend so much time around here really focusing on prices that we forget that price means nothing if a producer

has no crops to sell. We must focus on income.

Mr. Chairman, it would be easy for each of us to wander down

on our own path of political and personal trails. I would hope we

could resist this temptation and really put our heads together to

try to think out of the box on these issues.

Without question, the current Farm bill has not been able to address all the problems associated with the Asian flu, 3 or 4 years

of outstanding growing weather all throughout the world, unfair

trading practices by our competitors, and an overvalued dollar that

is hurting us in the export market.

As a matter of fact, no farm bill is perfect. Certainly, no farm bill

is ever written in stone. In the last 10 years, we have had nine

emergency bills, regardless of what farm bill has taken place, due

to the dynamic nature of agriculture and the way things change.

I would point out that in terms of what we tried to do in 1996

with the other component parts of crop insurance, regulatory reform, better conservation, tax relief, and a consistent and aggressive export policy, some of those things have not happened. However, I do want to thank the chairman for his outstanding help in

providing $8.3 billion in a new crop insurance program that was

authored by Senator Bob Kerrey and myself. Certainly, that is a

help. The previous Farm bill could not address the problems of a

producer who had high prices but no crop to harvest. That is the

previous Farm bill. The current farm bill does.

It is time we tried to look at things a little differently. In the

trade arena, the historical relationship of stocks-to-use ratios in

world stocks would seem to indicate that grain prices should be on

the rise. That is not happening, and we know that the purchasing

patterns of our world buyers have changed. We need to look at new

approaches.

I have a laundry list here of all the export programs. I see some

people in the audience who testified before the committee not too

long ago, and I said what out-of-the-box program could you come

up with with this new challenge that we face? They had some good

ideas, but most that I have read, Mr. Chairman, is as we went

down the list we wanted more money for the same programs. I am

not too sure that is the best answer.

I have got some goals for this Farm bill. No. 1, ensure a stable,

consistent farm income that supports not only our producers, but

also our rural communities and businesses. Two, maintain the

flexibility of the 1996 Act. Three, avoid if we can set-asides and

mandatory acreage reduction programs that only cause us to lose

world market share in the long run and that are not very friendly

to our environment.

Four, we must adhere to our WTO obligations as best we can.

Five, we continue a voluntary, incentive-based approach to conservation issues, expanding the funding and eligibility for the EnviVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00022 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
19

ronmental Quality Incentives Program. The chairman has a bill

that is much more comprehensive than that.

One other thing, Mr. Chairman. we really need to focus on carbon sequestration and what agriculture can do as a partner in our

efforts to find answers to the global warming syndrome.

Six, revisit our trade programs to address the world trade issues

and patterns as they currently exist, not as they did in 1990.

Seven, supplement the rural development programs to address

many of the critical infrastructure and the technology needs we

have in rural America.

Eight, invest in our agriculture research, including the upgrading

of USDA facilities, so that we can be sure that we are prepared to

address the disease threats that were mentioned by Senator Allard.

Mr. Chairman, I served on the Emerging Threats Subcommittee

of the Armed Services Committee as its chairman for three years.

Right now, our intelligence sources will rate agri-terrorism as a

very serious risk and a higher risk. We must be prepared to address that kind of a threat.

Finally, I have no illusions about this process. It is not going to

be easy. It never is and, yes, we will have our differences. With the

wide disparity in farm bill proposals that are out there and a nearly evenly split Senate, we have no choice but to work together.

I want to thank you, sir. I want to thank you for your past contribution to agriculture and I look forward to working with you and

my colleagues on this committee.

The CHAIRMAN. Senator Roberts, thank you very much for a very

strong statement. I wrote down those issues and these are issues

I know we can work together on. I really can’t take exception to

any of them. These are all things that we have to do and focus on.

I appreciate that and look forward to working closely with you and

calling upon your vast background and expertise in developing

farm bills to get this one through.

We have about four minutes left in the vote, so my intention is

to recess now. We have two votes, so we can get over and do this

vote, then vote early on the next one and then come right back. We

will pick up with Senator Dayton as soon as we come back.

We will be in recess for about 15 minutes.

[Recess.]

The CHAIRMAN. The Agriculture Committee will resume its sitting.

I would like to now call to the witness table the following individuals: Mr. Leland Swenson, President of the National Farmers

Union; Mr. Bob Stallman, President of the American Farm Bureau

Federation; Chuck Fluharty, Director of the Rural Policy Research

Institute; Craig Cox, Executive Vice President of the Soil and

Water Conservation Society; Howard Learner, Environmental Law

and Policy Center; Dr. Barbara Glenn, Member of the Board of Directors of the National Coalition for Food and Agricultural Research; Sharon Daly, Vice President for Social Policy of Catholic

Charities; and Dave Carter, Secretary–Treasurer of the Mountain

View Harvest Cooperative.

Before we start with the panel—I just wanted to make sure you

were all here—are we missing Mr. Learner? Well, anyway, I wanted you all here, but we are going to finish our statements by SenVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00023 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
20

ators on the committee. Senator Dayton is here and then also Senator Lincoln is on her way back to give her statement, and hopefully she will be here by the time that our distinguished Senator

from Minnesota and my good friend, Senator Dayton, makes his

opening statement.

At this time, I will recognize Senator Dayton.

STATEMENT OF HON. MARK DAYTON, A U.S. SENATOR FROM

MINNESOTA

Senator DAYTON. Thank you, Mr. Chairman, and I want to congratulate you, as others have, on your chairmanship. I very much

look forward to working with you. I am reminded that I am actually officially here today as a guest of the committee. When you are

100th in seniority, it is hard to imagine you can actually get demoted, but I have lost all my committee assignments.

[Laughter.]

The CHAIRMAN. How do you think I feel? I am talking about all

the firsts here today. I am officially chairman of the committee, but

I am in the minority, which is what you are saying, because of the

resolution we have not gotten passed yet. This is another first.

Senator DAYTON. Don’t call for any votes, that is my suggestion.

[Laughter.]

Senator DAYTON. I would like to get to our distinguished panel,

as well, Mr. Chairman, so I am going to limit my remarks to say

that I look forward to working with you. We have got some major

challenges, obviously, facing this legislation, but you have got us

right on the right track with all of these opportunities as well as

some tough issues we are going to have to face. I look forward to

working with you, and I look forward to hearing from our panelists

today.

The CHAIRMAN. We do have the time. I appreciate that, but if

you wanted to delve any further, I would be glad to hear any statements. Otherwise, it will be made a part of the record in its entirety.

Senator DAYTON. I will submit that for the record later. Thank

you.

The CHAIRMAN. I thank you very much, Senator Dayton.

[The prepared statement of Senator Dayton can be found in the

appendix on page 64.]

The CHAIRMAN. Since Senator Lincoln is not here, we will turn

to our panel, and when she arrives, we will interrupt for her statement.

As I said, we have a very distinguished panel, and while we had

had a couple of hearings earlier this year regarding some elements

of the Farm bill, they were not in the contextual framework of looking at the Farm bill. Senator Lugar was correct. He did chair some

hearings. We started laying the groundwork. Now we are into the

real meat of trying to get all the information we can from all the

various groups so that we can begin the drafting of this Farm bill.

I just might say for those of you who are here and for the staffs

and Senators who are here that we are developing a very aggressive hearing schedule for the month of July. I am certain that we

will be calling upon you again in the following months for clarificaVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00024 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
21

tion of your positions, perhaps for further input from you as we develop this legislation.

With that, I thank you for being here. Without objection, all of

your written statements will be made a part of the record. I ask,

if you could, sum up for us and give us sort of the highlights of

where you think we ought to be going in the Farm bill and what

you think we ought to be writing into it for the future. If you do

that, I would sure appreciate it, and then we can get into questions

and answers.

With that, I would first turn to a longtime friend of mine, Mr.

Leland Swenson, President of the National Farmers Union. I just

want you to know, I did read your statement last night. It is very

long and involved, but very comprehensive. Both you and Bob

Stallman, both of your statements are very, very inclusive and I

appreciated both of those statements. There is a lot of meat in

there.

With that, I will begin with Mr. Swenson.

STATEMENT OF LELAND SWENSON, PRESIDENT, NATIONAL

FARMERS UNION, WASHINGTON, DC

Mr. SWENSON. Thank you, Chairman Harkin. I congratulate you

on assuming the chair and look forward to working with you.

Ranking Member Lugar is not here, but I thank him for his outstanding leadership in his role as chair of the committee, and the

fellow members of the Senate Agriculture Committee.

As President of the National Farmers Union, it is a pleasure to

appear before you today on behalf of the 300,000 farm and ranch

members of the National Farmers Union to discuss with you our

ideas for new, and I emphasize comprehensive, agricultural policy.

We believe such a policy must be developed that will provide a

more sustainable and predictable long-term economic safety net for

producers and further encourage the conservation of our natural

resource base.

Additionally, agricultural policy should create new economic opportunities for producers, for our rural communities, for rural businesses, and through increased demand of our agricultural products,

both domestically and internationally, and help establish more

open and competitive markets, and understanding that we must do

all of this with a limited funding resource that is available. Our

proposals encompass those visionary principles.

I want to just highlight very quickly for you some of the goals

that we hope farm program policy will achieve.

No. 1 is that farmers will be able to achieve 100 percent of full

cost of production and a reasonable profit from the marketplace.

No. 2, that farm policy will help create opportunities to increase

both domestic and international demand for U.S. commodities, and

we do support the establishment of a nationwide renewable fuel

standards to triple the demand for U.S. commodities and provide

energy security and protect our environment, and we know that a

number of the members of this committee, including Senator

Lugar, Senator Daschle, you, Mr. Chairman, Senator Johnson, and

Senator Hagel have provided the leadership in the introduction of

the renewable fuels standard and we support that enactment.

22

We also believe farm policy should establish a countercyclical

safety net based on current production rather than obsolete yields

and bases to address unpredictable market circumstances.

Mr. Chairman, we believe that the Farm bill needs to look at

providing discretionary authority for the Secretary to contain program costs through targeting and inventory management programs.

I want to highlight very quickly some of the issues that we think

need to be encompassed. One is the non-recourse marketing loan,

which currently exists. We believe it should be continued in the

next farm program, but that the structure of the marketing loan

should be based on a percentage of the cost of production and productivity, not based on some arbitrary number that is just picked

out of the air.

All of you in your opening comments highlighted increased input

costs that have impacted farmers, that they have been unable to

deal with in relation to the price they received, or the safety net

that has been provided through the ad hoc emergency disaster. If

we structured a loan rate that was tied to a percentage of cost of

production, that way, it would respond to those fluctuations of

which impact producers beyond their control. We hope you will

take a look at that, and then have it be countercyclical so that it

is commodity-specific, based on actual production, and allowing

planning flexibility so farmers can produce what they want to

produce. With the marketing loan, it is non-recourse, planning

flexibility is already in place, and it is understood by producers.

We want to emphasize to have you look at some new vision in

the program, and we want to emphasize three Reserve programs

that we hope you will take into some consideration.

One is a renewable energy reserve. I was pleased, sitting here

listening, of the unified comments made about the commitment to

ethanol and bio-based fuel expansion. If we are going to do that

and not have it contract when we might have a disaster that improves prices in the market, I believe we have to have a renewable

energy reserve as important as a strategic oil reserve that we currently have in this country. It should be government-owned, and

farmer-stored, to support bio-energy demand, limited to one year’s

needs, so it does not overhang the commercial food or feed markets.

It is a dedicated reserve to energy.

The second reserve we would ask you to look at is a humanitarian food assistance reserve that is government-owned, farmerstored, to support the demand for growth of food aid programs,

such as P.L. 480 and the international school lunch program that

has been talked about already, and again, does not overhang the

commercial market.

The last reserve we would like you to consider is a production

loss reserve. A farmer-owned, farmer-stored, supplement to the

crop insurance coverage and the improvements made in the last

farm program with the leadership of Senator Roberts, Senator

Kerrey, and many of you on this committee, which enhanced the

program, but farmers are still left without 15 to 20 percent of coverage within the program. The production loss reserve, we are proposing would allow about a 20 percent limit on what farmers

produce to go into that production loss reserve, and if they suffer

23

a partial loss, they could draw out of that to receive crop protection

within that production year. We hope you will give that some consideration.

The other thing we would like to touch on is the authorization,

for discretionary authority to put in the tool box, if you want to call

it, for the Secretary to have a program of cost containment authority via the nature of a voluntary inventory management program.

Moving on very quickly, because I know my time is limited, we

do have in our proposal a proposal for dairy, which establishes a

structured target price support for dairy. We also encourage and

include provisions of S. 847 introduced by Senator Dayton to impose TRQs on milk protein concentrate, which we believe is impacting dairy producers all across this country. We do support the inclusion of a safety net for specialty crops.

We believe that conservation must be a critical element of this

Farm bill. We increase the conservation reserve program, and we

establish a short-term soil rehabilitation program of up to five million acres. I want to emphasize that, because a new issue that is

unfolding in agriculture. Karnal bunt is impacting producers in

Texas, and the concern of it spreading. Here is an opportunity

where those farmers could enroll in a short-term soil rehabilitation

program of which to eradicate that disease and receive some compensation. That way, we address it not just to the benefit of the

producers, but to the benefit of agriculture as a whole. We also

strongly support the Conservation Security Act, Senator, that you

are advancing.

I want to also emphasize that we believe a key component has

to be expanding the whole rural development initiative within the

farm program structure.

I want to also emphasize that in the area of trade, as has been

pointed out, we think a full effort should be made to expand international trade, but some critical issues must be addressed within

that dialog, within that discussion, if we are going to have that opportunity for producers. I believe the largest obstacle to U.S. trade

today is the lack of a mechanism to address exchange rate differentials and distortions, because that has really kept us out of many

markets or made us less competitive, even with the lowest prices

in the last 20 years.

I also support that removal of all sanctions of food and medical

products. We also believe that labor and environmental standards

must be brought to the table if we are going to again compete in

an international market place. We can say they have to be considered as a different remedy, but we have to compete in the nature

of production with environmental standards, labor standards, that

are directly related to our cost of production. We must bring it to

the table for discussion.

We also believe that we must retain domestic trade remedy authority for those issues that arise. We also believe the implementation of the Trade Adjustment Assistance Act for farmers, which is

there for workers. Also, we believe that, of course, credit must be

part of the Farm bill, research must be part of the Farm bill. Concentration must be a key element and enhancements and some new

visionary approaches in the area of addressing less-open, less-competitive markets.

24

I am pleased to say, Mr. Chairman and members of the committee, that as we analyze our very comprehensive farm bill in relation to the budget approved, we were pleased that in the analysis

provided by the University of Tennessee, that it came within the

budget approved, and so we hope you will take that in consideration.

In conclusion, let me just say that we urge you to enact a new,

comprehensive agricultural legislation that creates a broad range of

opportunities for producers, rural communities, and consumers. I

am often asked by producers and policymakers what our proposal

means to farmers and ranchers. We prepared a worksheet, Mr.

Chairman and members of the committee, that allows producers to

compare our proposal to current law, using yields and acreage from

their own farms. We would like to provide to the committee, if

there is no objection, and a copy of the worksheet completed by a

diversified Kansas farmer as to what our farm program would

mean. We will also provide you a blank one of which to look at or

share with producers from your respective States.

Mr. SWENSON. We hope you will give close review to our proposal

and we look forward to the opportunity to address any questions.

Thank you, Mr. Chairman and members of the committee.

The CHAIRMAN. Thank you very much, Mr. Swenson, for summarizing this very comprehensive statement you have here.

[The prepared statement of Mr. Swenson can be found in the appendix on page 78.]

The CHAIRMAN. I am now going to interrupt, as I said I would,

to recognize Senators who were not here earlier for any opening

statements they might have. First, we welcome to the committee

my neighbor, Senator Fitzgerald from Illinois.

STATEMENT OF HON. PETER FITZGERALD, A U.S. SENATOR

FROM ILLINOIS

Senator FITZGERALD. Mr. Chairman, thank you very much. If I

could just get unanimous consent to enter a statement in the

record, I would appreciate that.

I want to compliment the chairman and the ranking member for

holding these hearings and I wanted to welcome Howard Learner

from Chicago to the committee. I knew Howard back when I

worked in the Illinois State Senate in Springfield, Illinois.

I wanted to compliment the chairman, also, on press reports that

you wanted to add a new energy title to the Farm bill. I look forward to helping the committee craft such a title and that is a very

good idea. We should think about it and work toward it and I

would like to help you do that.

With that, Mr. Chairman, thank you very much.

The CHAIRMAN. Thank you very much, Senator Fitzgerald. We

are delighted and honored to have you also serve on this committee.

[The prepared statement of Senator Fitzgerald can be found in

the appendix on page 73.]

The CHAIRMAN. Senator Lincoln has not returned, so now we

turn to Mr. Bob Stallman, a rice and cattle producer from Columbus, Texas, serving his first term as President of the American

25

Farm Bureau Federation, elected January 13 of 2000. My notes say

you are the first President to hail from the Lone Star State.

Welcome, Mr. Stallman, and again, I thank you for your long,

very comprehensive statement, which I also read last night and

look forward to your statement this morning.

STATEMENT OF BOB STALLMAN, PRESIDENT, AMERICAN

FARM BUREAU FEDERATION, WASHINGTON, DC

Mr. STALLMAN. Thank you, Mr. Chairman, and congratulations

and we look forward to working with you under your leadership of

this committee that is extremely important to American agricultural producers. Senator Lugar and members of the committee, it

is a pleasure to be here this morning.

I want to begin today by talking about a farm opportunity rather

than a farm problem. I ask you as policymakers to commit to a

view of agriculture in which it plays a vital role in solving world

problems and in the process sets the stage for our industry to grow.

It is not an exaggeration to call our farm opportunities issues of

national security. American agriculture provides food security for

this nation and much of the rest of the world. We contribute to our

national economic security by running a positive balance of trade

and generating off-farm employment. We contribute to the world’s

environmental security by making use of intensive, high-tech production that saves fragile lands. We can do much more.

Our vision of the future is a vision of a growing industry that depends less on government payments and more on returns from the

marketplace, but we must implement policies that will grow our

markets. We can build demand by continuing to pursue a level

playing field in international markets. We must finalize the elimination of unilateral trade sanctions and open trade with these markets now. We must increase market promotion and market access.

We must pass trade negotiating authority. We must fight world

hunger with increased food assistance programs. As markets grow,

farm program costs decrease and farmer incomes grow from the

marketplace.

The cornerstone of this vision is a major role for renewable fuels

in our nation’s energy policy. Agriculture can provide fuels that improve air quality and make the Nation less dependent on foreign

oil. This energy contribution improves the environment, decreases

reliance on foreign oil, creates jobs, dramatically increases agricultural markets, and decreases farm program costs as markets grow.

However, bridging the gap between where we are now and where

we want to be in the future requires an expanded public investment in agriculture.

Another part of our short-term reality is that we will continue to

need income support consistent with our international trade obligations. Part of this new spending authority would be countercyclical

and, therefore, would decline as opportunities for market growth

are realized.

Before I move forward with our summary of specific recommendations for the next Farm bill, I want to share the parameters used by our board of directors in making the recommendations.

26

One, Farm Bureau, along with 23 other farm and commodity

groups, earlier in the year strongly urged Congress to authorize

$12 billion in additional annual spending for improvements in the

Farm bill. We are concerned that the fiscal year 2002 budget resolution only includes an additional $8 billion, on average, in agricultural funding for the next five fiscal years for the Agricultural

Committees to draft a bill that will provide an adequate safety net

for farmers and ranchers in the future. We have, however,

prioritized the needs outlined for the farm to comply with the average $8 billion in additional budget authority as passed by the

House and Senate.

Two, we believe it is extremely important for the new Farm bill

to stay within the WTO amber box commitments. The recommendations we present today are targeted toward the next Farm

bill. They are not our recommendations for a short-term, low-income relief package. We believe Congress should approve an economic assistance package of $7 billion for crop year 2001 as opposed to the $5.5 billion approved over in the House, and we think

those decisions need to be made fairly rapidly on behalf of producers.

Farm Bureau is the only group that will appear before your committee that represents producers of all agricultural commodities in

all 50 States and Puerto Rico. Because of this diversity in American agriculture, our recommendations constitute a tool box approach. We, like this committee, must ensure a balance between all

those interests. We believe our recommendations achieve that balance, as well as stay within a reasonable budget request and our

WTO commitments.

Specifically, Farm Bureau recommends, one, that production

flexibility contract payments to current contract holders be continued and that current provisions limiting the planting of fruits and

vegetables on land receiving PFC payments also should be continued.

We did consider the need for updating bases and yields, but believe that until more analysis on the economic impacts of that decision, bases and yields should not be updated at this point.

The $4 billion in production flexibility contract baseline should

be increased by $500 million in order to allow oil seed production

to be eligible for PFC contracts. This amount is based on an average of what soybean producers have received from market loss assistance payments over the last two years.

We support a loan rate rebalancing plan to increase loan rates

to be in historical alignment with the current soybean loan rate of

$5.26 per bushel in order to reduce the distortion between soybeans

and other program commodities.

The Farm bill should include a new countercyclical income assistance safety net that would be classified green box, and the details

of a proposal that we believe would be green box are incorporated

in our written statement.

We oppose new supply management programs, a farmer-owned

reserve, or any federally controlled grain reserve, with the exception of the existing capped emergency commodity reserve. We also

oppose extension of the CCC loans beyond the current terms,

means testing, all payment limitations, and targeting of benefits.

27

With respect to dairy, we think the dairy price support program should be extended with a support price of $9.90 per hundred

weight. We also support reauthorization and expansion of the

Northeast Dairy Compact and authorization of a Southern Dairy

Compact.

Farm Bureau supports a non-recourse marketing loan program

for wool and mohair that would operate similarly to other commodity marketing loan programs.

Moving away from the commodity provisions, we also support an increase of $2 billion within that $8 billion in funding for conservation stewardship programs. Conservation stewardship should include a mix of cost-shared funding and conservation incentive practice program payments.

We also would support additional funding for peanut and sugar

producers to help them address the structural problems and the

problems they are experiencing within those two industries.

Mr. Chairman, Farm Bureau looks forward to working with you

and other members of this committee on the upcoming Farm bill

and I will look forward to questions when the rest of the panelists

finish.

The CHAIRMAN. Mr. Stallman, thank you again very much for a

succinct summation of a very strong statement and comprehensive

one that you submitted to the committee. We look forward to working with you as we develop this Farm bill.

[The prepared statement of Mr. Stallman can be found in the appendix on page 130.]

The CHAIRMAN. I now turn to Mr. Chuck Fluharty, Director of

the Rural Policy Research Institute of Columbia, Missouri, and

again, as I said earlier, your statement will be made a part of the

record and I thank you for getting it to us so I could look at it last

night. Mr. Fluharty.

STATEMENT OF CHARLES W. FLUHARTY, DIRECTOR, RURAL

POLICY RESEARCH INSTITUTE, COLUMBIA, MISSOURI

Mr. FLUHARTY. Thank you, Mr. Chairman. Let me add my congratulations on your assuming the chair and thank Senator Lugar

for his excellent tenure and all the members of this committee for

the outstanding work on behalf of agriculture and rural communities. I really appreciate the opportunity to briefly discuss the context for this Farm bill, the framework you will use in for the content of this re-authorization.

As you know, our nation’s rural communities and farmers are

facing very difficult challenges today. Indeed, many communities,

firms, farms and ranches, and rural families are in very real crisis.

Conversely, however, this is also a time of great opportunity in

other rural communities, which are experiencing for the first time

in-migration, unmitigated sprawl, and the challenges inherent in

their culture and infrastructure for that development.

Indeed, one of the greatest challenges this committee faces is the

amazing diversity of rural America and the need to craft a comprehensive approach which addresses these many realities. You

must fully acknowledge this diversity, and recognize the differences

in space, geography, culture, and context for the entire rural America which you address.

28

We appreciate your commitment, Mr. Chairman, to taking a look

at a more integrative approach and we do all realize everyone in

this room, that this is a daunting challenge. I would say, however,

that I believe every one of the diverse stakeholders that are with

us today acknowledge, and are willing to play a role in building,

a new mutual interdependence which actually reflects the long understood and acted upon interdependence that their constituents in

rural communities work through every day.

It is far past time, Mr. Chairman, that the advocates for agriculture and rural communities unite around the basic truth that

we are in the same rowboat in a very large ocean. I commend this

committee for initiating this discussion with that spirit, and I believe everyone at this table and in this room recognizes that must

occur.

Also, Mr. Chairman, we are developing this at an historic moment. Never before in my professional career have I seen the organizations and institutions in this room representing the diverse

rural people, places, and producers, in common recognition that we

must develop a comprehensive, integrative approach to this Farm

bill. We simply must no longer accept the fragmentation of the

past. We need a comprehensive, contemporaneous approach designed to sustain agriculture and rural communities in a new global environment.

Mr. Chairman, our nation needs a national rural policy. That

does not exist and it matters that it does not. This is the committee

of mandate for rural people, and the hopes and dreams of rural

people stand with you. I urge, as you begin this, that this becomes

the committee where the future of rural America has champions for

a new and integrative way.

If this goal of an inclusive, informed dialog about rural policy is

to be initiated, what would the policies look like that we might

craft? How would they be developed, and could we build the bipartisan leadership to do that?

I really believe rural people today are in very bad need of this

and I would urge the development of that comprehensive framework. I know budgets are tight and time is tight, but I believe this

Farm bill should be different in kind and not degree from all of the

past. The times demand it, our constituencies need that, and if you

can seize this moment, we will have, frankly, optimized the most

unique opportunity of this generation to link rural development

and agriculture.

In my written statement, Mr. Chairman, I lay out the interdependence of farm and rural economies, the continuing challenges

of rural poverty, out-migration, and suburban sprawl. Each of these

issues has unique rural implications and there are many sectorspecific issues, from transportation to infrastructure, that are also

challenging. As we begin this reauthorization, I would urge special

attention to the importance of a comprehensive approach.

In this regard, the recommendations of the bipartisan Congressional Rural Caucus are especially key. Their recommendations to

President Bush are significant, and the ability to build a more comprehensive approach will be realized if this administration takes

action, in concert with the agriculture committees in doing this.

29

I would simply raise several overarching principles that must be

addressed in my closing comments, and I hope we can then get into

specifics.

The first is that we are going to need to sustain categorical programs and funding streams regardless of what we do, and be very

careful, in moving to a new incremental approach, that we first do

no harm. There is great fragility in this infrastructure, and as we

rethink approaches, we must be certain we sustain existing programs.

Second, we must build rural community capacity and leadership.

In my testimony, Mr. Chairman, I discuss the relationship of Federal funding flows to rural and urban areas. This is a very critical

issue. The Federal Government is now spending more money in

urban areas than rural, even with your expanding emergency payments. The challenge is, this rural commitment is 70 percent transfer payments to individuals. In urban areas, that figure is 48 percent transfers. The rest of that urban money is going to build infrastructure, community capacity for government, and sustaining community-private-philanthropic linkages. That 70–48 differential inhibits the ability of rural local leaders, like yourselves, to build

upon this Federal commitment.

Urban areas have HUD and they have the Department of Transportation. They have a CDBG that is essentially a place entitlement. I would urge that this committee rethink a place entitlement

for rural places, so that they do not have to compete against one

another for these monies through local government, but can begin

to think about a way for that capacity to be built.

Two last points, Mr. Chairman. First of all, we must rethink the

linkage between agriculture and rural development. Agriculture is

a rural development strategy and that interdependency, is amply

pointed out in my testimony. As we think about rural development

this year, let us talk about agriculture as a key component of that.

Last, Mr. Chairman, we simply must address the challenge of

venture and equity capital in rural America. We will not build

rural entrepreneurship unless we address the decided disparity in

venture and equity capital between rural and urban America.

Mr. Chairman and members of the committee, I thank you so

much for this comprehensive approach and we look forward to specific questions and working with you in the future. Thank you so

much.

The CHAIRMAN. Thank you very much, Mr. Fluharty.

[The prepared statement of Mr. Fluharty can be found in the appendix on page 151.]

The CHAIRMAN. Next, we will turn to Craig Cox, Executive Vice

President, Soil and Water Conservation Society. Mr. Cox.

STATEMENT OF CRAIG COX, EXECUTIVE VICE PRESIDENT,

SOIL AND WATER CONSERVATION SOCIETY, ANKENY, IOWA

Mr. COX. Mr. Chairman, Senator Lugar, members of the committee, as you remember, I appeared before this committee in March

at a conservation hearing that Senator Lugar held, and at that

time, we reported to you on what we heard in a series of five workshops that we held across the country in 2000. Since that time, we

have taken what we heard at those workshops and we have develVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00033 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
30

oped a set of concrete recommendations for reform of both conservation provisions and farm policy, which are contained in our

new report that has been made available to members and the committee and detailed in my written statement.

What I would like to do in my oral remarks is to hit the high

points, as you instructed Mr. Chairman. In short, what we heard

at these workshops was that the next Farm bill has to be about

more than the price of corn or the price of wheat or the price of

cotton or any other particular agricultural commodity. What our

workshop participants were looking for was a comprehensive, integrated agriculture policy designed to care for the land and to keep

people on the land to care for it. They communicated to us, often

with great passion, that current agricultural policy is falling short

of that goal.

Based on our analysis of what we heard at our workshops, we

think the reason agricultural policy is falling short of that goal is

because that policy is out of balance. We think conservation policy

is unbalanced and we think farm policy is unbalanced, and our recommendations are designed to restore that balance.

On the conservation side, we think the imbalance comes from an

over-reliance on tools that take land out of production and devote

it then primarily to conservation purposes. What we are missing in

current conservation policies and programs is the ability to keep

land in production and work with producers who want to keep

farming and ranching, but do so in a more environmentally sound

way.

On the farm program side, we believe we have developed an

over-reliance on a set of tools that is designed to either subsidize

the income of or affect the price of a handful of commodities. As

production of those commodities has concentrated on fewer and

fewer farms, the benefits of those programs have concentrated in

fewer and fewer hands. For example, in 1999, about 47 percent of

the subsidy benefits flowed to about 8 percent of producers who are

operating about 32 percent of farm acres.

Those two imbalances, taken together, means that the reach of

our current agricultural policy is seriously limited. We simply are

not touching most farmers, either on conservation or on the farm

policy side, in a way that can really effectively keep all of agriculture working and keep all of agriculture taking care of the land.

To restore balance on the conservation policy side, we would urge

you to double funding for existing conservation programs from

about $2.5 billion to $5 billion a year. Most of that additional $2.5

billion investment go to; No. 1, programs like EQIP that help working farms and ranches landscape and the technical infrastructure—

research, technical assistance, education—that is absolutely critical

to a renewed focus on the working landscape.

That is the minimum we think that ought to happen, and it is

about, in percentage terms, the same increase in funding that this

committee accomplished in the 1985 Farm bill. It would be a big

mistake at this juncture to settle for the minimum. We instead

would urge you to make room in farm policy itself for an option

based on land stewardship, an option that would pay people a fair

return for investing their labor and capital in improving the environment, to pay them a fair return for what they are already doing

31

to improve the environment and to encourage them to do more to

improve the environment.

In our vision, we see this new program as being an analog to the

existing production flexibility contract, except the stewardship contracts would be based on the care of the land rather than on the

mix of commodities that were produced in some historical period in

the past.

Fixing what we have got is the first step, but we will miss a tremendous opportunity if we do not take this chance to build into

farm policy itself a program based on stewardship. Thank you, sir.

The CHAIRMAN. Thank you very much, Mr. Cox.

[The prepared statement of Mr. Cox can be found in the appendix on page 163.]

The CHAIRMAN. Now we will turn to Howard Learner of the Environmental Law and Policy Center in Chicago.

STATEMENT OF HOWARD A. LEARNER, EXECUTIVE DIRECTOR,

ENVIRONMENTAL LAW AND POLICY CENTER OF THE

MIDWEST, CHICAGO, ILLINOIS

Mr. LEARNER. Thank you, Mr. Chairman, Senator Lugar, and the

members of the committee for the opportunity to appear today to

discuss why wind power and biomass energy development in farming communities can produce both environmental quality gains for

the broader public and economic development benefits for farmers

in particular.

We encourage the committee to explore ways to include clean energy development initiatives in a new energy title in the Farm bill.

We believe that farmers can effectively become suppliers, not just

users, of energy.

Everybody knows that the Midwest farmlands, in particular, are

ideal for growing crops that energize our bodies. If the right public

policies are put into place, farmers can also be encouraged to develop wind power opportunities, produce crops for bio-diesel and

ethanol fuels, use land for conservation stewardship, and grow

high-yield energy crops that can be used to generate electricity to

power our economy. Expanding wind power and biomass energy,

will provide new markets for crops while reducing air and water

pollution, deterring soil erosion, and providing rural income and

jobs. Let us give farmers the tools to succeed and the incentives to

succeed in these genuinely new markets that provide environmental value.

I have five points to present today in summary fashion. First, let

me turn to wind power development opportunities. Wind power is

the world’s fastest-growing energy source. It expanded about 35

percent in 1998. More than 600 megawatts of new wind power has

come on line in the Midwest alone since 1998 that avoids pollution

from central power plants and provides rural economic development opportunities.

Wind energy is truly a cash crop for farmers. The typical annual lease payment for windy sites in the Midwest is about $3,000 per

turbine. For a 50-megawatt wind farm, that is about $125,000 to

$150,000 per year.

Iowa and Minnesota have led the way with wind power development and there are major new wind power projects now going up

32

in Iowa, Illinois, Kansas, Minnesota and Wisconsin. Wind power is

fast becoming a larger reality in the Midwest and across our nation. There are more development opportunities for large wind

farms. There are also significant untapped opportunities for smallscale distributed wind power to serve individual farms and smaller

communities that are in more remote locations.

Congress should consider steps that can be taken to map good

wind power sites in rural communities, provide easy access to monitoring equipment to determine what is a good windy site for local

farmers, and provide low-cost financing for smaller distributed

wind power projects.

Let me turn to my second point. Energy efficiency is the best, the

fastest, and the cheapest solution to power reliability problems. Inefficient energy use continues to waste money and cause unnecessary pollution, and the places for energy efficiency improvements

are not limited to the major cities and the suburbs. There are many

opportunities to be tapped for cost-effective energy efficiency improvements and farming activities that include more efficient motors and pumps, more efficient grain-drying equipment, and better

lighting.

The third point; the importance of a renewable portfolio standard. Federal policy action is necessary to transform this energy development potential for farmers from a good idea into reality. The

single most important legislative step would be a Federal renewable portfolio standard that requires all retail electricity suppliers

to include a specific percentage of renewable energy supplies as

part of the generating power mix that they are providing to consumers.

It is essential that the types of renewable energy be carefully defined to include principally wind power, biomass energy, and solar

power; not municipal solid waste incineration, the burning of tires,

construction wastes, and some other materials. Otherwise, the

value of a renewable portfolio standard gets sidetracked. The opportunity to provide wind power and biomass energy development

is undermined.

Fourth point, in developing the Federal farm bill, this committee

should explore a potential new conservation energy reserve program that would recognize the value of putting agricultural lands

into energy production in ways that also provide conservation production. The Chariton Valley biomass energy project in Iowa is a

good example of how switchgrass can be grown and harvested to

provide 35 megawatts of power. A conservation energy reserve program could be structured to allow, for example, one cut of

switchgrass each fall after the birds have migrated. That is good

for the farm economy, that is good for the environment. It provides

a new cash crop.

A fifth and final point, we need transmission access reform. If

you cannot get the wind power to the load centers and the market

because of transmission constraints, it stymies the development of

wind power and biomass energy.

To wrap up, historically, America has relied on farmers to work

their lands to provide crops to put food on our tables. There are

now 21st century opportunities to use lands to produce crops that

power our economy, our homes, our schools, and our factories. We

33

urge this committee to consider an energy title to the Farm bill

that can spur these clean energy development opportunities, especially wind power and biomass energy development.

Thank you for the opportunity to appear today. We look forward

to working with the members of the committee on the Farm bill.

The CHAIRMAN. Thank you very much, Mr. Learner.

[The prepared statement of Mr. Learner can be found in the appendix on page 174.]

The CHAIRMAN. Now we turn to Dr. Barbara Glenn, member of

the Board of Directors of the National Coalition for Food and Agricultural Research and Executive Vice President of the Federation

of Animal Science Societies. Dr. Glenn.

STATEMENT OF BARBARA P. GLENN, MEMBER, BOARD OF

DIRECTORS, NATIONAL COALITION FOR FOOD AND

AGRICULTURAL RESEARCH, AND EXECUTIVE VICE

PRESIDENT, FEDERATION OF ANIMAL SCIENCE

SOCIETIES, BETHESDA, MARYLAND

Ms. GLENN. Thank you, Mr. Chairman, for inviting the National

Coalition for Food and Agricultural Research to testify. I am a

member of the Board of Directors of the National C FAR, as you

mentioned, in my role as Chairperson of CoFARM, which is the Coalition on Funding Agricultural Research Missions. We look forward as NC FAR to working with this committee.

First, we want to thank the members of this committee for your

support of food and agricultural research and education programs.

We believe increased Federal support for food and agricultural research and education should be a key component of this committee’s goal to develop sound food and agricultural policy.

National C FAR is a newly organized, broad-based, stakeholder

coalition of some 90 organizations. National C FAR recommends

the doubling of Federal funding of food, nutrition, agriculture, natural resource, and fiber research, extension, and education programs during the next five years. This is to be net additional funding on a continuing basis that complements but does not compete

with or displace the existing portfolio of Federal programs of research and education.

Why should the Federal Government invest in food and agricultural research extension and education? We believe the answer is

because the food and agriculture sector is fundamentally important

to the United States, as we have heard this morning. It provides

food, creates jobs and income, reduces the trade deficit, contributes

to the quality of life, and bolsters national security. In addition,

public financed research and education should complement private

research by focusing in areas where the private sector does not

have an incentive to invest.

What have been the measurable benefits of Federal investment

for American farmers and consumers? According to a recent analysis by the International Food Policy Research Institute, the average

annual rate of return on public investments in food and agricultural research and extension was a whopping 81 percent, an extremely high rate of return by any benchmark. Additionally, as we

know, advancements in agricultural productivity have led to enVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00037 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
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hancing the environment and the quality of life, especially linking

good food to good health.

Why should we double food and agricultural research? Well,

there are three basic reasons, the way we see it.

First, agricultural research and education can address many of

today’s pressing problems. World food demand is escalating. Some $100 billion of annual U.S. health costs are linked to poor diets and

foodborne pathogens. Farmers are suffering from some of the lowest prices in over two decades. We need longer-term approaches to

assist farmers and retain value of their commodities. Other problems include threats to our environment, the escalating costs of energy, and the need for improved bio-security and bio-safety tools to

protect against bio-terrorism and dreaded problems, such as the

foot and mouth and mad cow diseases and other emerging plant

and animal pests.

Second, Federal funding of food and agricultural research in the

USDA, when measured in real, inflation-adjusted dollars, is less

now than it was in 1978, so it has essentially been flat for over 20

years. Furthermore, currently, we only invest about one dollar of

Federal funds in food and agricultural research for every $500 of

consumer expenditures on food and fiber, a very low rate, indeed.

The third reason, but perhaps one of the most important for doubling food and agricultural research is to capitalize upon the promising opportunities that advances in science and technology make

possible, for example, the sequencing of the human plant and animal genomes. Taking advantage of these unprecedented bio-technological advances will require significant increases in research funding.

Last, how should the doubled funds be spent? Well, there are

several areas of opportunity. The National C FAR does not have a

list of specific research recommendations. However, major areas of

research and education opportunities have been identified by our

members and related consensus-building coalitions and they are included in our written testimony.

National C FAR emphasizes the continuing need to build the capacity to do quality research and education. We must maintain a

balanced portfolio of Federal research and education programs, including competitive grants, formula funds, and intramural programs.

With respect to current legislation, National C FAR recommends

that, first, the basic authorization and provisions of the Agricultural Research, Extension, and Education Reform Act of 1998 be

extended and incorporated in the new Farm bill.

Second, an additional provision should be included that it is the

sense of Congress that Federal funding of research, extension, and

education be doubled over the next five years.

Third, the provisions should be strengthened to expand stakeholder participation in identifying that research and education

funding and the needs and opportunities.

In conclusion, National C FAR hopes that we have convinced you

that because of its primary role in serving all Americans, Federal

investments in food and agricultural research should be doubled

over the next five years. Again, we appreciate the opportunity to

share our views. We look forward to working with you and memVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00038 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
35

bers of the committee toward enhancing Federal support of food

and agricultural research and education. Thank you.

The CHAIRMAN. Dr. Glenn, thank you very much for that statement and for the more comprehensive statement you submitted to

the committee.

Ms. GLENN. Thank you.

[The prepared statement of Ms. Glenn can be found in the appendix on page 180.]

The CHAIRMAN. As I announced earlier, I would try to recognize

Senators when they arrived for their statements, and Senator Lincoln has returned. I want to recognize our distinguished Senator

from the State of Arkansas for her opening statement and any

other comments she might wish to make. Senator Lincoln.

STATEMENT OF HON. BLANCHE LINCOLN, A U.S. SENATOR

FROM ARKANSAS

Senator LINCOLN. Thank you so much, Mr. Chairman, and I

apologize for interrupting such a distinguished panel. I do thank

all of you all as witnesses for being here and working with us, your

testimony that you have submitted as well as what you are giving.

Mr. Chairman, I want to thank you so much for holding this important hearing and for getting this committee on track to rewrite

a new farm bill. Of course, the short-term and the long-term are

both very important to our agricultural producers in Arkansas. I

would like to put a plug in for our supplemental appropriations and

emergency assistance and also to put a plug for the AMTA payments that we will be providing, or hope to be providing, at a 1999

level and how crucial that is to ensure that our farmers are actually going to have the resources to be able to complete this agricultural production year. It is coming at an awfully late time for them

and it is going to be absolutely essential.

In terms of the long-term, Mr. Chairman, I am anxious to get to

work on a new farm bill, because, frankly, our farmers need some

relief from our current farm policy. For almost six years, our farmers have labored under a farm policy that is ill-suited for the pressures that global markets and poor weather can exert. That is why

for each of the past 3 years we have sent back to our farmers a

multi-billion-dollar emergency aid package.

Freedom to Farm offered our farmers the flexibility to plant the

crops they felt were most needed by the market. This was a fundamental component of Freedom to Farm, allowing our farmers for

the first time in a long time to respond to a free domestic marketplace rather than to the government. Yet, Freedom to Farm did not

give our farmers the tools to respond to a global marketplace that

is influenced by the actions of foreign governments. This shortcoming reveals the FAIR Act’s fatal flaw, the lack of an adequate

safety net.

The next Farm bill that we hope to produce, with your assistance, those of you all here today working with us and others that

will contribute, should be built on these lessons. Planting flexibility

should be retained. Our farmers must have the power to choose

what they grow and when they grow it. This planting flexibility

must be paired with some recognition that the policies of our tradVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00039 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
36

ing partners can have as much effect on commodity incomes as any

drought or flood.

I believe my colleague from Arkansas, Senator Hutchinson, may

have mentioned some of these issues in terms of trading partners

and opening up those markets.

We must encourage the expansion of our overseas markets wherever and whenever we can. As a member of the Senate Finance

Committee, working with our chairman, Senator Baucus, I am committed to lowering trade barriers and providing our farmers with

the leverage they need to push the global commodities market into

the 21st century and seeing the U.S. as an absolute player in that.

We must also provide a solid, reliable safety net. With a strong

safety net, our farmers, our rural bankers, and the rural economy

that depends on them will know they will have the support to

weather the bad years.

Senator Roberts in his opening statement alluded to some of

those issues in terms of the fact that we are not just addressing

the issues of producers and farmers, but to all of rural America.

Rural America will also know that they can look to the coming

years with confidence rather than with fear and uncertainty.

The next Farm bill must also address other areas of importance

for our rural communities. It should contain a strong forestry title

that promotes sustainable forestry in this country, and it should

recognize that our private forests provide everything from timber

production, carbon sequestration, wildlife protection, recreation,

and clean water. We need to remember that tree farmers are farmers, too. It just takes them longer to grow their crops than those

of us that are used to traditional row crops.

We should also remember the wisdom of conservation, and we

appreciate, Mr. Learner, your input there. Whether we are talking

about our farmlands or our wetlands, energy sources, bio-conversion, a multitude of options and opportunities that are out there,

we must help our rural communities protect against the damaging

forces of erosion and overuse, not to mention what it can do to help

our income in rural economies and in producers by taking marginal

lands out of production in ways that we have seen productive over

the past several years.

Finally, we must look down the road to the long-term needs of

rural development. Many small towns are missing the financial

support to develop their own resources. Often, the support that we

offer does no more than help them struggle from one crisis to the

next. We must provide better support for these communities so that

they can build the necessary infrastructure to grow rather than

simply to survive.

Mr. Chairman, all over the country, our rural communities are

collapsing. Virtually every commodity is suffering. It is high time

that we got to work on a new farm bill. I thank you for your leadership, for the ranking member, Senator Lugar, for his willingness to

work with us on this, for both of your patience as well as the unbelievable institutional history and wisdom that we have on this committee to be able to make this process a huge success. I stand with

you and ready to work hard and we, too, appreciate all of the input

that you all as our first panel of witnesses and the many individuals that will have a great deal of input into this very, very imporVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00040 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
37

tant process and the product that we will produce for the American

people. Thank you, Mr. Chairman, very much.

[The prepared statement of Senator Lincoln can be found in the

appendix on page 75.]

The CHAIRMAN. Thank you for a very eloquent statement, Senator Lincoln, and I look forward to working with you in developing

this legislation.

Now we will turn to my neighbor to the West—Mr. Fitzgerald is

my neighbor to the East. Now my neighbor to the West, our former

great Governor of the State of Nebraska, now Senator from my

neighboring State of Nebraska, Senator Ben Nelson.

STATEMENT OF HON. BEN NELSON, A U.S. SENATOR FROM

NEBRASKA

Senator NELSON. Thank you, Mr. Chairman, and Senator Lugar,

I appreciate your work, as well. I want to thank you for convening

this hearing this morning. I apologize also for being later getting

here and certainly hate to interrupt the panelists.

It is good to be with you today and I really look forward to working on this important committee and I hope to be a part of it when

the organizing resolution is accomplished. I hope I will be able to

rejoin it.

Of course, moving forward on the new Farm bill is my top priority for agriculture and it is of critical importance not only to farmers in Nebraska, where it is extremely important, but also to our

rural communities and the economy of our entire State and the

economy of almost every rural State. With one of every four jobs

in Nebraska dependent on agriculture, we clearly have a lot at

stake.

Chairman Harkin, let me commend you for focusing on some

issues in this hearing today that don’t often get as much public attention in the Farm bill and in the debate as they ought to—rural

development, nutrition, research, and the three ‘‘F’’s I talk about

so often, food, fiber, and now fuels, oxygenates, alternative sources

of energy.

This piece of legislation is the closest thing we have to a rural

America policy, and as Mr. Fluharty points out in his testimony,

only 6 percent of rural Americans live on farms and less than 2

percent of the rural population is engaged in farming as a primary

occupation. It is still a rural America issue.

Many of our rural communities are withering away, and as a

former Governor, I can attest to the huge impact that that has on

our State. I am pleased to see that many of our witnesses today

are talking about some of the policies that affect the rural areas,

as well as directly affecting farmers and ranchers.

Mr. Chairman, as you are well aware, I am eager to work with

you and help hold whatever necessary hearings and to get to work

on crafting our new farm bill. That is what I have heard from one

end of the State of Nebraska to the other end of the State, and I

appreciate the urgency, as I know you do and the members of this

committee appreciate the urgency. I thank you for getting us started. I want to be brief, but I look forward to working together in

the upcoming months. Thank you very much.

38

The CHAIRMAN. Thank you very much, Senator Nelson. I look forward to working with you on this important legislation.

Now we will turn to Sharon Daly, Vice President for Social Policy. Ms. Daly provides overall direction to Catholic Charities USA’s

legislative efforts and leads its work on welfare reform and Federal

budget and tax issues. Welcome, Ms. Daly.

STATEMENT OF SHARON DALY, VICE PRESIDENT FOR SOCIAL

POLICY, CATHOLIC CHARITIES USA, ALEXANDRIA, VIRGINIA

Ms. DALY. Thank you very much, Mr. Chairman, for this opportunity to testify about the key role of the food stamp program.

Catholic Charities USA represents 1,400 independent local agencies with a quarter-of-a-million staff and volunteers who serve ten

million people a year. They provide every kind of social service, but

the single most frequently needed service is emergency food, so we

have very strong views about the food stamp program.

My first point is that, until recently, the food stamp program has

been a resounding success in reducing hunger among families with

children. Over the last three years, even though earnings for lowincome workers actually declined when adjusted for inflation and

welfare payments went down dramatically, childhood hunger declined because of the food stamp program, the WIC program, school

nutrition programs, and the Earned Income Credit.

The food stamp program has always had strong bipartisan support with great leadership by Senators Harkin and Leahy and

Lugar, and, of course, Senator Dole, who is in our prayers today.

My second point is that even though there is less hunger now

than 30 years ago, there is still far more than a rich nation should

tolerate, and as food stamp rolls have declined recently, hunger is

again on the rise. We begin with the premise that here in the

United States, the strongest economic powerhouse in human history, that parents working full-time should earn enough to support

their children in dignity and should not be reduced to begging for

food for their children. That is the fact for millions of Americans,

and not just occasionally, but regularly.

Despite the high employment rates, record profits, and stock

market highs, wages at the bottom of the labor market have stagnated, especially compared to the higher costs for the basic necessities, like rents, gas and electric, and gasoline. The working poor

are forced to swallow their dignity and rely more and more on

handouts from charities.

Now, the lack of affordable housing is the single biggest culprit,

but the outdated and outrageous rules of the food stamp program

are close behind. Just like Senator Conrad’s chart about the farmers, the working poor in America are paying more and getting less.

The experience of Catholic Charities agencies in every State is

they report steady increases in need for emergency food of 20 percent or more each year since 1996. Meanwhile, participation in the

food stamp program was dropping by more than seven million people. We think there is a connection. Most of the increased need has

been among working families with children, the very same group

who have been dropped from the food stamp program. In fact, nearly two-thirds of the families leaving welfare-to-work were dropped

39

from food stamp within six months, even though they were still

poor enough to qualify for and need food stamps.

Twenty-five years ago, it was rare for working parents to show

up at churches looking for food unless a death in the family or a

fire left the family without food or money for food. Now we have

a nationwide network of emergency food programs trying desperately to cope with chronic emergencies, emergencies of low

wages, high rents, and no food stamp benefits.

I am not suggesting that the food stamp program alone can solve

the problem. We need increases in the minimum wage and more

affordable rental housing. The food stamp program could do a

much better job. Unfortunately, the program operates on three outdated assumptions.

The first is that low-income families can afford to spend 30 percent of their incomes on food, and food stamp benefits are calculated to fill the gap between the cost of the lowest-possible-cost

diet and 30 percent of family income. In fact, only one-fourth of

low-income households get any housing subsidy, so three-fourths

are now paying rents that consume 50, 60, and 70 percent of their

incomes. A parent working at or near the minimum wage with

take-home pay of only $800 or $900 a month has to pay about $700

a month or more in rent, and that is before utilities, leaving not

enough for food.

Our first recommendation is to adjust the food stamp program to

the reality that the majority of food stamp households can’t afford

more than 15 or 20 percent of their incomes for food.

The second outdated assumption is that most recipients only

need help temporarily. The benefit structure is based on a diet that

is minimally adequate for short periods. Unfortunately, families

need help for years. The very people who create the conditions that

give the rest of us a decent quality of life through their work in

nursing homes and cleaning office buildings and serving food are

expected to survive on long term on a diet that is officially ‘‘minimal’’. America’s children are being nurtured on a diet that is like

prisoners’ rations.

Our second recommendation is to adjust the food stamp program

to the reality that people are not going to be able to get off food

stamps quickly.

The third outdated assumption is that people who need food

stamp are on welfare or unemployment insurance and can spend

a full day every few months at the food stamp office, once again

filling out a 26-page application and supplying 14 kinds of verification and enduring the condescension of the eligibility worker. In

some States, Mr. Chairman, it is easier to pass the bar exam than

to get certified for food stamps.

Today, in the typical household, the adults have jobs that do not

provide time off, and a visit to the food stamp office means sacrificing a day’s pay and risking their jobs. In many States, working

parents have to reapply for food stamps every three months. It is

no wonder that less than half of the eligible households are participating in the program.

Our third recommendation is to recognize the reality that lowpaid workers are the largest group of eligibles and to allow families

who are leaving welfare-to-work to automatically be enrolled in

40

food stamp for a full year without additional paperwork and to

allow other low-wage workers to apply for food stamps on a simplified form by mail.

We are also concerned about welfare recipients who are now

reaching their lifetime limits and will depend more on food stamps

than ever. About a third of these parents have severe physical and

mental disabilities or care for a parent or a child who is disabled.

Eventually, they are going to qualify for an exemption or some kind

of disability payment, but meanwhile, the food stamp program is

the only thing standing between them and starvation.

We need a comprehensive communication strategy to inform parents that their food stamp eligibility does not end with the TANF

time limit. The committee should require States to conduct outreach and education campaigns to maintain that food safety net.

Congress should not be misled. The religious and community organizations that feed the poor now are already stretched beyond

their capacity. The cupboard is almost bare.

In addition, Mr. Chairman, I would like to mention once again

to this committee that it is important to restore eligibility to food

stamps for immigrants who are legally present in this country and

are working incredibly hard. I was disappointed that I didn’t hear

the word ‘‘farm worker’’ in anyone’s statement so far, member or

witness. We heard about farmers. We heard about growers. Nobody

mentioned farm workers.

The Catholic Bishops’ Conference and Catholic Charities USA

and the National Rural Life Conference recently began a series of

listening sessions on agriculture issues and they will be listening

to testimony on research and on conservation and on problems of

small farmers, all of those important issues. They also have already heard some important testimony in Sacramento, California,

last week about farm workers, and Mr. Chairman, the plight of

farm workers is just as bad as it was when Cesar Chavez began

organizing in the 1960’s. I urge you to hold a hearing to look into

what is happening to America’s farm workers, who are being exploited, dehumanized, and treated like commodities.

Mr. Chairman, I also want to flag another issue for you, which

is WIC appropriations. As you know, the administration’s request

is insufficient for this coming year and if the Congress does not add

$110 million to the administration’s request, WIC offices will have

to turn away perhaps as many as 200,000 children next year, so

we urge you all who care about WIC to help make that additional

$110 million happen.

Mr. Chairman, thank you so much for the chance to testify and

to raise issues that are just as important as all the other agriculture issues.

The CHAIRMAN. Thank you very much, Ms. Daly, for reminding

us that the Farm bill needs to be comprehensive and the food

stamp portion is one vital part of this bill that we are going to address. Your suggestions are right on target. We are going to be

looking at that and I assume we will be in contact with you further

on this issue.

[The prepared statement of Ms. Daly can be found in the appendix on page 199.]

41

The CHAIRMAN. I am told that there is a vote supposedly at 11:50

or 11:55. We have one more witness. If we have time for questions,

we will do that and we will move into that. If there is a vote, then

I assume we will just adjourn, and because of the late hour, we will

not return.

Now we will turn to Mr. Dave Carter, Secretary–Treasurer of the

Mountain View Harvest Cooperative, Longmont, Colorado.

STATEMENT OF DAVID E. CARTER, SECRETARY–TREASURER,

MOUNTAIN VIEW HARVEST COOPERATIVE, LONGMONT,

COLORADO

Mr. CARTER. Thank you, Mr. Chairman and Ranking Minority

Member Lugar and members of the committee. I am indeed honored to testify before you today. I am here in my capacity today as

the Secretary–Treasurer and board member of the Mountain View

Harvest Cooperative, which is a producer-owned bakery in Northern Colorado that is owned by 225 Colorado wheat farmers. I want

to tell you very briefly the story of Mountain View Harvest and

then use that to illustrate some of the things that we think need

to be included in particularly the rural development title of the

new Farm bill.

It was in early 1994 that I had an opportunity to join a small

group of producers, all of whom were part of an old-line traditional

grain origination cooperative that had gone bankrupt in the 1980’s,

but it was a group of producers who wanted to take a look at reestablishing a presence, a cooperative presence in Colorado for particularly grain marketing. We went through the summer of 1994

and talked about various ideas and began to think that perhaps we

ought to look down some other avenues, and in September 1994,

we received a $100,000 grant from the U.S. Department of Agriculture to conduct feasibility work.

That gave us the ability to hire some professional expertise to

come in and take a look at marketing opportunities, 14 different

areas of potential marketing opportunities for Colorado producers.

We looked at everything from grain origination and gluten to pizza

dough and pretzels. What we identified were some emerging opportunities in a segment of the baking industry particularly known as

par-bake, or partially baked bread. You take the dough, you mix

it, you let it rest and rise and you bake it about 90 percent of the

way. You sell it to a customer. They pop it in the oven and tell everybody they make their own bread. This is a growing part of the

industry and it represented a real opportunity.

Well, following that feasibility study, then we were also fortunate

enough to receive a $25,000 no-interest loan from a for-profit subsidiary of a non-profit organization that allowed us to bring on

three individuals, an investment advisor, an accountant, and an attorney, to really go through and do the due diligence and to develop

a business plan for the operation of this new cooperative. In that

process, we were able to locate that there was an existing bakery

in Northern Colorado, a modern facility that might be available for

purchase.

We entered into some negotiations and reached an arrangement

that we knew would require us then to generate $5 million to finalize that purchase. We developed a plan in which there would be

42

400 shares of stock at $12,500 apiece to capitalize this new cooperative. Now, not too many farmers have got $12,500 laying around

in the kitchen drawer, and that is why it is so critical that the local

Farm Credit office stepped up to the plate at that time, and they

put together a signature loan program in which producers, qualified producers, could go in and borrow the money to make their equity investment in that cooperative.

With that program in hand and with the business plan in hand,

we were able to go to the countryside and market the 400 shares

to 225 producers, and on April 15, 1997, we closed the purchase of

Gerard’s French Bakery in Northern Colorado. It was a $6 million

bakery at the time we purchased it. Last year, the annual sales

topped $17 million. We are the national supplier to a well-known

sandwich chain as well as a regional supplier to several restaurants, and through a joint venture with another cooperative, we

are in the retail business.

The growth has been a blessing, but it has come with some challenges. Unfortunately, we have not been able to pay the dividends

that we would like to with our members because we have been

forced to try and fund the growth through internal profits, but we

feel that we are building a very successful business.

Well, that is the Mountain View Harvest scenario. I have also

been involved with some other cooperatives, including one in

Southern Colorado/Northern New Mexico that involved 110 limited

resource ranchers that had an idea of putting together a certified

kosher beef processing cooperative. They had a much different experience. They didn’t have the feasibility resources. They didn’t

have an institution that stepped up to the plate. They were undercapitalized. They had inexperienced management and it had severe

difficulties before shutting down in 1997.

In taking a look at those two experiences, as well as other emerging cooperatives, and Senator Roberts, I had an opportunity yesterday, for example, to visit with Kent Sims of the American White

Wheat Association and their process, and so that has led me to the

recommendations that there are five particular areas that we think

would be very helpful in the rural development title.

No. 1 is we simply need to have more money available for feasibility studies. That $100,000 that was used by Mountain View

Harvest was critical in keeping us not only on the right path, but

keeping us from pursuing some other alternatives that we thought

were very attractive, but in the analysis would have been an absolute disaster.

Second, we need to have more funding through the Rural Cooperative Development Grant program. We are very fortunate in our

area to have a Cooperative Development Center, and other States

are equally as fortunate. If you look at the map, there are some

black holes, and we think that every State ought to have adequate

funding to have a Rural Cooperative Development Grant Center in

their State to provide those resources and the technical assistance

that are necessary for successful development.

Third, the Business and Industry Loan program needs to be

strengthened and expanded. We think that that is a good concept.

When Mountain View came along, we didn’t have that program in

place to help producers borrow the money for their equity shares.

43

B and I is supposed to help us do that. It is not working quite as

well as envisioned. It needs to be retooled.

One of the things that is very important is we also need to recognize that the real emerging opportunities in cooperative development may come from acquisition rather than a new startup. Many

times when you go into an acquisition, what you end up buying are

blue sky, customer lists, the distribution routes, markets, and those

are extremely valuable, but they are not the type of assets the

lenders like to use as collateral. They aren’t bricks and mortar, and

so we need to make that change.

Fourth, we need to expand the Value-Added Grant program. The $60 million in requests that were in for this round that were just

announced, the $10 million in funding demonstrate that there is a

tremendous pent-up demand, and that can be very successful in

helping new co-ops get across the threshold of the organizational

stage and into the operational stage.

Then, fifth, we feel that the new Farm bill ought to direct Federal institutions to expand the purchases of food that they make

from farmer-owned cooperatives and minority-owned businesses.

We feel that that could provide a demand pull that could provide

a consistent customer that can help the cooperatives move into new

areas.

Mr. Chairman and Senator Lugar, Senator Roberts, those are

five recommendations. We feel that this is critically important, because not only are cooperatives and farmer-owned enterprises going

to be important in the food and fiber sector, but as has been mentioned repeatedly, the demand for energy is going to create new opportunities for farmer-owned cooperatives.

I would like to just end with a comment that summarizes many

of the comments here today. In the final analysis, safe, healthy

food and reasonable, reliable energy all begin with secure, profitable farm and ranch families. Thank you very much.

The CHAIRMAN. Thank you very much, Mr. Carter.

[The prepared statement of Mr. Carter can be found in the appendix on page 205.]

The CHAIRMAN. I want to thank all of the panel for your patience

and willingness to be here and to sit through a long morning. As

I said in the beginning, your testimony is most valuable and I am

certain that we will be in contact with you through our staffs for

further development of your thoughts and your suggestions. I assume that we will probably see some of you back here again as we

have more hearings in July and on to however long we have to go

to get this thing put together.

We do not have a vote yet. What I will do is I will just ask one

question and then I will turn to Senator Lugar and then Senator

Roberts and maybe we can go for as long as until we have a vote

here.

I first want to turn to our two individuals that represent the

broad-based farm organizations, the Farm Bureau and the Farmers

Union, to just, again, ask a little bit more of a development in your

thinking on the situation we have now in terms of farm income and

stocks on hand and what we need to do in terms of a countercyclical program. Both of you mentioned countercyclical and I am

not certain I know exactly how we are going to move ahead on that

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countercyclical program. We talk about countercyclical, but I will

bet a lot of us have different ideas on what that really means. If

you could just elaborate a little bit, both of you, on where you think

we ought to be headed on a countercyclical type of a support program.

Mr. Swenson.

Mr. SWENSON. Thank you, Mr. Chairman. It is a very good question. No. 1, it is clear now in the filing with the WTO that AMTA

payments as such are going to be classified as amber, and so taking

that into consideration, as we take a look to the future, how do we

structure an appropriate safety net?

First of all, we would stress equity, equity in the support mechanism among all commodities.

Two is that if we are going to maintain, as we believe we should,

planting flexibility to allow producers to plant whatever commodity

they may wish, we believe that the countercyclical then should be

tied to commodity specific. That is why in our proposal we have

gone away from any just payment regardless of payment and just

to produce and produce, is that we tie our support to the actual

commodity via an adjustment within the commodity loan rate. We

do not believe that will then—— The CHAIRMAN. A marketing loan?

Mr. SWENSON. The marketing loan, the loan program. That will

not distort what happens in the market because we maintain the

marketing loan program, the non-recourse element so that the commodities have that choice to flow into the market. It is just a protection via the loan rate if that commodity price goes low. It serves

as a countercyclical, but it is tied to what a farmer chooses to

produce today.

Then you have the protection of not being able to produce by participation, No. 1, in the crop insurance program, which has been

enhanced, and two, in the crop protection program that we have

outlined in our proposal.

The CHAIRMAN. Thank you very much. Mr. Stallman.

Mr. STALLMAN. Well, you are right, Mr. Chairman. There has

been a lot of discussion about countercyclical and probably not

enough definition at this point, although we are moving toward a

little better definition. I would disagree with my colleague that

AMTA payments are going to be classified as amber box in the future. That notification specifically referred to the supplemental assistance payments, and also it was classified as a de minimis payment under the amber box provisions, which in essence means it

does not count against our $19.1 billion cap.

Having looked at countercyclical ideas in terms of programs, if

you look at what the Congress has done the past three years, in

essence, that has been countercyclical. Although it has been on an

ad hoc basis, it has been very much appreciated and needed. We

looked at ways to structure a system, a payment system that would

more or less mimic what the Congress did in response to low

prices, where payments would go out in low-price periods. Then

when prices improved, those payments would not go out.

We think in looking at the agreement on agriculture under the

WTO that as long as you meet certain provisions of that agreement, one can be structured green box and still be countercyclical.

45

It would not be tied to an individual producer and their individual

situation, because when you tie it to production, current production, that, by definition, is going to make it amber box.

Our example in there, we believe would be classified as a green

box. Obviously, no one would know until there was an actual WTO

dispute case because no one gives you pre-clearances with respect

to whether a program is amber box or green box. It can be done,

but it will have to be crafted, and in the end, it may not satisfy

enough of the objectives of producers or Members of Congress, but

we will have to see, we are working on it.

The CHAIRMAN. Thank you both very much. We will explore this

further as we go along on the countercyclical.

Senator Lugar.

Senator LUGAR. Thank you very much, Mr. Chairman. I just

wanted to comment on several things just briefly that came up in

the hearing today that require some thought and, hopefully, some

incorporation.

Specifically, Mr. Learner, in your testimony, in addition to advocating more efficient use of electricity in the country, and you suggest a number of changes in which large corporations in this country that are producing appliances and various other things could

make sales of those to a willing public that would adopt them and

use less electricity, and ideally, some Federal energy policy may

come along that gives some push to that.

Specifically with regard to agriculture and your third recommendation, you call for a Federal renewable portfolio standard

that requires all retail electrical suppliers to include a specified

percentage of renewable energy resources. That would steadily increase from 8 percent in 2010 to 22 percent in 2020, and you specify three specific kinds of energy, wind power, solar power, and

closed-loop biomass energy as the ones to qualify, and you would

exclude various others.

In the closed-loop biomass energy, describe what that is and how

that applies to farmers and producers.

Mr. LEARNER. That includes what most of us call biomass energy

of farm crops, be it corn waste, be it switchgrass, or be it alfalfa.

What we are trying to get away from here is the battle over incineration versus what most people consider biomass energy. There is

tremendous public support for developing biomass energy, both to

help out farmers and reduce pollution. There is a different public

view when it comes to incineration. Closed-loop means you keep it

within the system.

Senator LUGAR. As you know, I have advocated annually research funds for this purpose. Senator Harkin has been a strong

advocate. Each year, we have watched House appropriators slice

this into small pieces. Even if it survives at places like Purdue or

Iowa State or so forth, the ability, or at least the willingness of people who supply energy to incorporate these ideas out of our university laboratories has been very limited. I have tried to follow this

or trace it, piece by piece, as to how it might get out there. Obviously, this is a very big idea. An administration, any administration, Democratic or Republican, who finally took energy seriously

would have adopted this a long time ago and moved down the trail,

as opposed to leaving the vulnerability that we have.

46

Essentially, you are asking in this Farm bill, as I see it, for us

to undertake that. In other words, we, as an authorization committee, would mandate that this occur. Clearly, some other committees

are going to say, well, we have some interest in this, maybe in jurisdiction. You folks are supposed to be dealing with farmers, producers, farm workers, food stamp recipients, and what have you,

but not the energy problems of the country. Fundamentally, that

is what we are doing here. I like the idea, obviously. I am trying

to sketch in my own mind’s eye how we do it, how we make it stick,

how something like this happens.

Mr. LEARNER. Clearly, energy issues cut across committee jurisdiction lines. There is no way around that. The production tax credit, for example, extension of which is very important, would not fall

appropriately within this committee’s jurisdiction, and that is key

to biomass energy production, especially closed-loop, as well as for

wind power and solar power development.

I am not suggesting that this committee take up the whole of energy policy, but, rather that a rural-focused energy title is very appropriate as a part of what this committee does in the Federal

Farm bill, and there are steps that can be taken in the Farm bill

that would seriously advance biomass energy and wind power energy. The Conservation Energy Reserve Program, patterned after,

in many ways, the Conservation Reserve Program, falls quite comfortably within the Federal Farm bill parameters.

Where a renewable portfolio standard goes is an interesting jurisdictional question. Clearly, Senator Jeffords, who has sponsored

a bill, might have some views on the appropriate committee. It is

also appropriate for consideration by this committee here.

Going to your point about the link between developing biomass

energy and bringing that clean energy to consumers, that is why

the renewable portfolio standard is so important. If all retail electricity suppliers are required to include a reasonable percentage of

renewable energy in the power they deliver to consumers, that

would encourage biomass energy development and pull it into the

market.

Ten years ago, this may have been visionary and simply interesting. Today, it is on the front burner, for national domestic energy

policy, and as you have eloquently written, as a matter of foreign

policy and security as well.

Senator LUGAR. I thank you, and perhaps you can help us with

some language that will guide that section, because it is an important concept.

Mr. LEARNER. Senator, we would be pleased to work with you

and your staff.

Senator LUGAR. May I ask just one more question of Mr. Cox?

In your report, and it is a very important document, ‘‘Seeking Common Ground for Conservation,’’ which you mentioned from the previous hearing, but let me just mention, on page 38, you have some

provocative ideas, one of which is that the combined effect of crop

insurance premium subsidies would add 900,000 acres to aggregate

plantings of eight major field crops—this is a USDA Economic Research, ERS, estimate—that marketing loan benefits have added

four million to five million acres to the total U.S. acreage planted

to eight major field crops, and you go on to point out that crop inVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00050 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
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surance has the other benefit, or liability, of keeping fragile lands

in production.

Now, the effect of this, as some of us have pointed out, is that

we are attempting to do some things that help farmers and they

get income out to farmers and a lot more of that has been suggested today. The net effect of that also is to increase plantings, to

increase production, to increase supply. At the very time that we

are worrying about countercyclical, we are pushing up the amount

of supply and pushing down the price, and the price is inevitably

going to remain low so long as we have policies that encourage people to plant more, a whole lot more, and really ensure the income

of doing so.

These thoughts innocently placed on page 36, or maybe not innocently enough, simply point out that we have got a problem. We

are working both sides of the coin. If I had a dollar for everybody

I have heard today say we want full flexibility, Freedom to Farm,

everybody making their choices, but we want a lot of money for

farmers, even though Freedom to Farm may mean prices go down,

stay down, we do not export and they stay down further.

Now, in the midst of all of that, you can spend a lot of money

and still, in fact, get net income on farm investment up to a very

minimal figure. What you are suggesting is a different approach,

and that is, essentially, you get income to farmers for being stewards of the land, and that helps a lot of small farmers as well as

large farmers. It is sort of indiscriminate on that basis, so we are

not into a class warfare clash that hits us frequently in these hearings.

I would just say, more power to you. It is an excellent suggestion.

The question would be how much of the resources given to this

committee by the 10-year budget, or whatever budget we are working on, are to be allocated to conservation and to the sorts of things

you have suggested, as opposed to income supplements or countercyclical funds or so forth.

I don’t know the answer to that, but this is a good entry into the

field, at least as the competition for those resources begins. I do not

have a question, I just commend you, and likewise Mr. Fluharty

and Mr. Carter, really, for another facet of the fact that we are

talking about agriculture development because we are talking

about rural America and less than 20 percent of our counties even

have 20 percent of their income coming from farming that are in

agricultural territory, which means 80 percent have very, very little visible support from anything in the production side.

Now, maybe that is not the jurisdiction of this committee, either,

in other words, to take on the demographics of the whole country

and try to shore up farm country. If not us, who? We are trying

to get back to that predicament, so we probably should tackle it,

even with the potential of others interloping in or making amendments and suggestions.

I appreciate all of your testimony. It is very, very helpful in

terms of a new vision for a farm bill as we try to take a look at

all of the persons who are affected, including the rural poor. Ms.

Daly has made a very good point. She has mentioned farm workers,

and so has Senator Harkin and so will I. They are a very important

facet, in addition to the recipients of the food stamps.

48

I thank you, Mr. Chairman, for indulging me these extra minutes.

The CHAIRMAN. No, I am delighted to hear it. I am tracking with

you on exactly what you are talking about. That is going to be one

of the real challenges of this Farm bill, to put this together with

that methodology, but you are right. We are really going to have

to look at rural development and how we get those funds out there

in the rural development sector, and a lot of these people talked

about that, too.

I recognize Senator Roberts.

Senator ROBERTS. Mr. Chairman, I ask unanimous consent that

the committee now report the current Farm bill, that we double existing program funding for all nine provisions and establish farm

prices at parity levels, and that farmers are allowed to farm as determined by Purdue University.

[Laughter.]

The CHAIRMAN. It is nice having you on the committee.

[Laughter.]

Senator ROBERTS. There is a workshop that is going on right now

with the distinguished National Association of Conservation Districts, since we are talking about conservation, Kansas State University, home of the ever-optimistic and Fighting Wildcats, the University of California, Iowa State, and the speaker is me. I began

speaking about five minutes ago. I do not know what is going to

be on the floor, but instead of asking specific questions, if I could

be permitted to list some concerns, other than the concern I have

of the former distinguished chairman’s comments as to where we

should farm and not farm.

Leland, a loan rate based on 80 percent of the cost of production,

and I am assuming you are referring to a national cost of production as opposed to individual producers, the year is 1981. As you

remember, the deficiency payments at that particular time and the

loan rate were pretty much tried to figure out on a national cost

of production. The first amendment that this member ever got

passed in the House Agriculture Committee was a Cost of Production Board, a producer Cost of Production Board, and Bill

Turentine from Garden City, Kansas, America, was the chairman

and Bill Lesher had to put up with him when he worked down at

the Department of Agriculture. We had people from all sections

from the country and they had what I call meaningful dialog for

the greater part of a year trying to figure out cost inputs, different

regions, and different commodities.

I do not know if that is possible, but it seems to me that something out of the Department of Agriculture a little more specific as

to the cost of production would be helpful, regardless if we feel we

want to go down and make the loan rate an income protection device as opposed to a market-clearing device. It is an interesting

comment and I would like to visit with you further about that.

Then in addition, one of the problems or one of the challenges we

have is we have learned in the past, or at least our producers out

in Kansas will set aside their most marginal land and they increase the inputs on their more productive land when we go to

something like flex-fallow, and that has always been a concern, not

to mention that our competitors increased their production by more

49

than we set aside. Bob, you have got a good statement on that in

your statement. That is something we have to consider.

Then again, you indicate, Leland, that we need to target benefits

to small and moderate-sized farms. Congressman Tim Penny and

I used to go into this at considerable detail and we finally both

thought that the small family farmer is somebody five-foot-two who

farmed up in Vermont, and that a large family farmer was somebody six-foot-two that had about, what, 5,000 acres in Kansas.

[Laughter.]

Senator ROBERTS. I really have some concern, having the Department of Agriculture or anybody else trying to define who is a small

family farmer and what is a small family farm. It would be an interesting debate.

One other concern. Bob—well, I am going to leave the green and

amber business to the House Agriculture Committee.

What would you do—in terms of Farm Bureau members, is it

more important for your members to maintain the soybean loan

rate at $5.26 or to reduce it, if necessary for budget reasons, in

order to establish an AMTA payment or a PFC payment for soybeans? Is there a choice? I know you want both. I know everybody

wants both. I don’t know of anybody here that did not say, I want

an increase in my budget. I understand that because you represent

outstanding programs. Anyway, think about that a little bit. It may

have to come to that.

You are recommending $8 billion per year. Is that just in commodity program spending or does that include other important programs, i.e., exports, rural development, and conservation, over the

$7.3 billion that is in the budget? Does that $8 billion include all

of that?

Mr. STALLMAN. Well, it included the prioritized list out of our

original $12 billion, which included those other components. The

board decided that $8 billion should be focused on more of the direct income support programs as opposed to the other, although we

say, if we can get additional funding, we need to have those others.

It was prioritized that way.

Senator ROBERTS. All the commodity groups and the farm organizations have indicated—well, almost all, I cannot think of anybody

that thinks the current budget is enough, and it goes from your

recommendation of $8 billion, Your original recommendation was

$12 billion, and we have some up to $14 billion. I would point out,

over a 10-year period, that is not $73 billion, it is $101 billion up

to $137 billion. I don’t know. I don’t mean to be Scrooge around

this place, just the opposite, as far as I am concerned. We have to

really think about where we are headed in total.

Mr. Cox, you have, and this is just a concern of mine and Senator Lugar and I have had a lot of dialog in this regard, CRP seems

to be concentrated in several States in the Plains area and should

be moved throughout the country. I remember being shown a red

map and a blue map, at Purdue, by the way, where on the blue

map, it showed, obviously, that Kansas and the Great Plains had

a significant amount of funding on CRP. After all, it was our bill.

I authored it. I thought it might be appropriate if we would do

that. Then there was a red map.

50

Purdue is saying, in other sections of the country, we have vital

resource needs, and that is true. I said, why don’t maybe you get

a supplemental instead of taking money from us for you? If we

don’t have CRP, I would remind you of the sodbuster days in the

1930’s and all of that, and I don’t think we want to go back to that.

That should be a concern, and that really speaks to the effort.

We have to work together as opposed to robbing Pat to pay somebody else. I would remind everybody that soil is the greatest nontoxic, I guess, pollutant that we have.

Now, Mr. Chairman, I had a whole series of concerns here, but

in the interest of time and the interest of getting down the road

and making my speech and sparing you the agony of listening to

me, I want to thank every witness especially for coming all this

way and taking your time, your very valuable time, to give us your

suggestions and your proposals. I don’t know how we do it all

under the budget restrictions we have, but each one of you have

dedicated a great deal of time and effort in this enterprise and I

thank you for your testimony, and I thank you, Mr. Chairman.

The CHAIRMAN. Thank you very much, Senator Roberts, and believe me, it is always a delight to listen to you, always. We may

not always agree, but it is a delight to listen to you and to hear

your views, and again, the long history and knowledge of our agricultural programs.

I wish we had more time, but now a vote has started, to get into

more questions. I had some on the food stamp program and the

whole new system of using plastic rather than the stamps itself

and how that is working out, but we will get back to that in future

hearings.

Again, what we see from this panel is the diversity of the issues

that confront us. Regarding a couple of those issues in terms of energy, I noted carefully and wrote down carefully all of the comments made by the members of this committee, and almost everyone mentioned something about the energy issue. I believe there is

going to be some consensus here, at least to do something in that

area.

Senator Lugar, of course, has pointed out the jurisdictional problems. It is unclear as to what jurisdiction we have and what we can

do under our jurisdictional constraints, and, of course, under the

budget constraints, also. I will just speak for myself in saying that

I don’t mind pushing the envelope a little bit on the energy issue.

If other committees are not addressing this in terms of what it

means to rural America, then we should. We will just have to, perhaps, duke it out with some of the other committees later on. We

ought to go very aggressively down this road. Whereas there may

be some disagreements on other aspects of agricultural policy, this

is one on which we might find some pretty broad-based agreements.

Also on conservation, I note that there is at least a desire to

move beyond the old land reduction CRP, taking land out, but to

do something about providing some support for farmers on working

land. I picked that up from a lot of the comments, also.

On the research end, I just want to say, Dr. Glenn, of course, this

is something that is going to be vitally important. You can rest asVerDate 11-MAY-2000 14:53 Oct 17, 2002 Jkt 081659 PO 00000 Frm 00054 Fmt 6633 Sfmt 6633 81659.TXT SAG1 PsN: SAG1
51

sured that we are going to continue our support for a good sound

agricultural research system here.

Again, when it comes to energy and value-added products, cooperatives hold a great promise for helping farmers get more of

that consumer dollar. I just close my comments by saying that,

right now, the farmers are getting the lowest share of the consumer dollar ever in history. That won’t be made up by government

payments. It has got to be made up through some way of getting

more of that value-added from the crops that they produce, and the

cooperatives in terms of energy, value-added, all these other things,

can help get more money back to those individual farmers. We will

be pursuing that.

Last, I throw out a question for all of you who are here and others on this whole concept of price supports, safety nets, and countercyclical. However this all works out as we try to come up with

bipartisan agreements and find out where we can agree and work

this thing out. I ask this question. Should we still be involved as

a nation in supporting every bushel and every bale that is produced? Should we continue the policy of supporting every bushel

and every bale produced? I will just let that linger there. Think

about it. It is a question that I will be asking in July as we have

further hearings, as to whether or not we want to continue that

policy or maybe shift into other areas.

With that, I thank you. As Senator Roberts said, I thank you for

being here. A lot of you came a great distance. Rest assured that

we have taken your testimony into account and it will be made an

entire part of the hearing record. As I said earlier and repeated

and I will repeat one more time, we look forward to having further

contact with you as the hearing and markup process proceeds.

Thank you. The committee will stand adjourned until the call of

the chair at some time after the Fourth of July recess. We are

working now and I am going to be working with Senator Lugar to

set up a hearing schedule in July. We will be back sometime the

first week after we come back.

[Whereupon, at 12:19 p.m., the committee was adjourned.]

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A P P E N D I X

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DOCUMENTS SUBMITTED FOR THE RECORD

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QUESTIONS AND ANSWERS

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