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84–112 PDF 2003

S. HRG. 107–828

CONSERVATION ON WORKING LANDS FOR THE

NEW FEDERAL FARM BILL

HEARING

BEFORE THE

COMMITTEE ON AGRICULTURE,

NUTRITION, AND FORESTRY

UNITED STATES SENATE

ONE HUNDRED SEVENTH CONGRESS

FIRST SESSION

JULY 31, 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

(II)

(III)

C O N T E N T S

Page

HEARING(S):

Conservation on Working Lands for the New Federal Farm Bill ........................ 01

Tuesday, July 31, 2001

STATEMENTS PRESENTED BY SENATORS

Lincoln Hon. Blanche L., a U.S. Senator from Arkansas ..................................... 01

Hutchinson, Hon. Tim, a U.S. Senator from Arkansas ........................................ 02

Thomas, Hon. Craig, a U.S. Senator from Wyoming ............................................ 03

WITNESSES

Dunklin, George, Jr., USA Rice Federation, DeWitt, Arkansas .......................... 07

Klein, Lee, Nations Corn Growers Association and American Soybean

Association, Washington, DC .............................................................................. 04

Mast, Gary, National Association of Conservation Districts, Washington, DC .. 09

Serfling, Dave, land Stewardship Project, Preston, Minnesota ........................... 11

Shaffer, Mark, Defenders of Wildlife, Washington, DC ........................................ 13

APPENDIX

PREPARED STATEMENTS:

Dunklin, George ................................................................................................ 35

Klein, Lee .......................................................................................................... 30

Mast, Gary ........................................................................................................ 40

Serfling, Dave ................................................................................................... 52

Shaffer, Mark .................................................................................................... 57

DOCUMENT(S) SUBMITTED FOR THE RECORD:

Eddleman, Robert, L., Soil and Water Conservation Society ....................... 76

Letter to Senators Grassly and Graham ........................................................ 83

(1)

CONSERVATION ON WORKING LANDS FOR

THE NEW FEDERAL FARM BILL

TUESDAY, JULY 31, 2001

U.S. SENATE,

COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY,

Washington, DC.

The committee met, pursuant to notice, at 9:28 a.m., in room SR–

328A, Russell Senate Office Building, Hon. Blanche L. Lincoln presiding.

Present or submitting a statement: Senators Lincoln, Conrad,

Dayton, Wellstone, Thomas, Hutchinson, and Crapo.

STATEMENT OF HON. BLANCHE L. LINCOLN, A U.S. SENATOR

FROM ARKANSAS

Senator LINCOLN [presiding]. The Committee on Agriculture is

called to order.

Good morning, and thanks to all of you, colleagues, witnesses,

and the public here to join us for this hearing this morning.

I first want to give Chairman Harkin’s regrets. He is terribly

sorry that he was unable to be here this morning. As many of you

all know, this is a very important issue to the chairman, but he is

tied up on the floor with some other important matters on behalf

of agriculture, and we are glad that he is there.

For several weeks now, the committee has been holding a series

of hearings to gather testimony from a wide range of voices all focused on how best to design a farm bill. These hearings have examined the various elements, both the good and the bad, of Freedom

to Farm, to help us figure out how we can design a new and better

farm policy.

Just last Thursday, the House Agriculture Committee marked up

its version of the Farm bill. We have a lot of ground here in the

Senate to cover to catch up with the House, but I know that if we

set our minds to it, we can achieve it.

Chairman Harkin called this hearing to explore the benefits of

good conservation practices in agriculture, specifically on working

lands or lands already in production. Unfortunately, as I mentioned, he is tied up on the floor as the Senate now debates the

market loss assistance package, and he has asked me to chair this

hearing in his absence; and I am very proud to sit in as chair of

this hearing on his behalf.

Over these past several weeks of hearings, Chairman Harkin has

made it very clear that he believes the next Farm bill should contain a strong conservation title. As chairperson of the SubcommitVerDate 11-MAY-2000 08:58 Jan 31, 2003 Jkt 084112 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 84112.TXT SAG1 PsN: SAG1
2

tee on Forestry, Conservation, and Rural Revitalization, I share

this belief.

The preservation of soil and clean water is a key component of

any long-term plan for agriculture. As the daughter of a seventhgeneration Arkansas farm family in East Arkansas, I know how

important good farming practices and the enhancement of natural

resources are to a farm’s success. I also know how important the

success of farming is to the vitality of our small towns and rural

areas.

While the business of farming is to produce the food that we eat

and the clothing that we wear, the soul of farming is in the relationship between the farmer and the land. This business of farming

helps to strengthen our rural economy, and the farmer’s relationship to the land helps to strengthen our rural society.

This is one reason why farmers take so much pride in the work

that they do feeding this Nation and the rest of the world. They

feel a special bond to their work, a bond that goes beyond a simple

vocation.

It is also why they work so hard to take care of the land, for as

we all know, farmers are the original conservationists. I come from

that first-hand, having watched my father for years, as well as my

grandfather, and understanding not only their love of the occupation that they had but, more importantly, their love of the land.

If you do not work hard to preserve the land that you farm, it

cannot continue to produce a plentiful harvest year after year—any

farmer will tell you that—nor can it endure to be handed down to

your sons and daughters, which is also at the forefront of these incredible people’s minds.

As we convene today to explore the role of conservation policy in

the context of the new Farm bill, it is important that we keep in

mind both the business of farming and the relationship of the farmer to the land. A fragile bond connects the two. We have limited

resources, and we must choose between an array of policy priorities.

That Chairman Harkin must miss this hearing to manage the

debate on yet another emergency market loss assistance package illustrates just how important it is that we choose wisely in these

debates.

I thank the witnesses for joining us today to share with us their

views on how to improve conservation policy as we move forward

on this new farm bill. Their expertise on the many issues in conservation is very much appreciated and, as I mentioned, is extremely important for us in the debate that we find in front of us.

Before I introduce the panel, I want to welcome the gentleman

from Arkansas and ask if he has a few comments.

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

FROM ARKANSAS

Senator HUTCHINSON. Madam Chairman, my colleague from Arkansas, I have a very few comments, but I want to thank you for

chairing the hearing today. It is a very important hearing, and I

know that Chairman Harkin is involved in some very, very important business in ensuring that this farm bill moves forward which

we sent out of committee last week.

3

I want to express my own sense of urgency about seeing all action completed on that bill before we leave for the August recess.

You alluded to this last week in the committee markup, that we

have been hearing since January about the need for Congress to

act and act expeditiously. We have not acted expeditiously. We

have not moved this forward as we should have, and it has caused

uncertainty and instability, and I regret that. Well, it would be

compounding our errors to fail to move this bill forward prior to the

August recess. I do not want to go back and face them, and I am

sure Madam Chairman does not, either.

This hearing is very important, as we look at the new Farm bill

and what role conservation is going to play in that new Farm bill

and in particular how the conservation efforts and production are

going to be related. I look forward to this as a learning experience.

I especially want to express my welcome to Mr. George Dunklin,

Jr., from DeWitt, AR, who is one of our leading citizens and leading

agricultural leaders and a good friend of all of us in Arkansas. We

appreciate his expertise and his willingness to share that today.

Thank you, Madam Chairman.

Senator LINCOLN. Thank you.

Senator Thomas, would you like to offer any comments before I

introduce the witnesses?

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

WYOMING

Senator THOMAS. Good morning.

Senator LINCOLN. Good morning.

Senator THOMAS. Of course, I always have to take advantage of

that.

Thank you very much for holding the hearing, and I thank all

the witnesses for being here.

Certainly this business of the conservation segment of our farm

bill has become one of the more important things, partly because

it is very important that we do something with conservation and

with the lands, and partly because it is a different, unique way of

supporting agriculture in addition to or apart from, frankly, program crops.

Being from Wyoming where the program crops are less important, I guess—or, not less important, but the dominance is livestock

and so on—so of course, it makes a great deal of difference; we are

fairly limited in our participation in the farm programs.

I do not know exactly how this will work. Certainly, I am interested in hearing your ideas. The funding of the EQIP program is

important. That is one that has been very useful and continues to

be. We are talking more and more about protecting wildlife and

protecting wetlands, doing some things that will keep open space

and the technical assistance that goes with all those things.

It is a new area and one that we certainly need to explore. Our

conservation district program in Wyoming has been very important. We are dealing with clean water and non-point source water

problems, of course, and many of the agricultural people need some

assistance if they are going to comply with those things. Hopefully,

the regulations can be made a little more useful and workable beforehand, but nevertheless that is there.

4

This is kind of a breakthrough, a little bit of a change in the way

we handle agriculture, so we are doing something to support agriculture more generally, frankly, without tying it to production so

that we are not working against ourselves in terms of overproducing and yet paying for production in this change of ways of doing

things.

Thank you, Madam Chairman. I look forward to the testimony.

Senator LINCOLN. Thank you.

Senator Crapo has joined us. He has also been quite up front and

very, very involved in the conservation issue, and I appreciate all

of his hard work.

Senator do you have any opening comments?

Senator CRAPO. I have no opening statement, Madam Chairman.

Thank you.

Senator LINCOLN. I will now introduce the panel. First, we have

Mr. Lee Klein, who will testify on behalf of both the National Corn

Growers and the American Soybean Association.

Mr. GEORGE DUNKLIN JR. Is from our great State of Arkansas,

a native of that great Delta town, DeWitt, AR. I have to also comment that Mr. Dunklin comes from a farm family as I do, having

known his father and the great work that his father has done, and

seeing George follow in his footsteps is a great thing. He will be

testifying on behalf of the U.S. Rice Federation.

Mr. Gary Mast is here on behalf of the National Association of

Conservation Districts.

Mr. Dave Serfling will be introduced by our good friend from

Minnesota, Senator Wellstone, who will be joining us shortly. We

are delighted to have you with us, Mr. Serfling.

Last but not least, Dr. Mark Shaffer is here on behalf of Defenders of Wildlife.

We thank the panel very much for your willingness to be here

and share the expertise that you all have with our committee. We

hope that it will be an ongoing relationship and something we can

call on you on as we continue to move forward on the Farm bill.

We look forward to your testimony, and we will start with Mr.

Klein.

STATEMENT OF LEE KLEIN, NATIONAL CORN GROWERS

ASSOCIATION AND AMERICAN SOYBEAN ASSOCIATION,

WASHINGTON, DC

Mr. KLEIN. Thank you, Madam Chairman, for the opportunity to

testify here today about conservation.

I serve as president of the National Corn Growers Association,

and I also serve as a member of the board of directors of the Lower

Elkhorn Natural Resources District. I farm near Battle Creek in

northeast Nebraska, where my wife and I raise corn, seed corn,

soybeans, rye, alfalfa, and hay, and have a cow/calf operation.

This testimony is also presented on behalf of the American Soybean Association.

The National Corn Growers Association’s members have a commitment to our community to ensure that we have clean water and

health, viable soil to ensure the land is productive for many years

to come. We take responsibility for our farming activities and must

5

do so with a keen eye toward conservation, productivity, and marketing.

We support voluntary, incentive-based conservation programs

that the past Farm bill have created. We believe that flexibility in

programs is essential for their widespread adoption, given local

variances in conservation and water quality priorities, production

practices, climate, soil type, and many other factors.

Several members of the committee have introduced legislation to

address the expansion of voluntary, incentive-based conservation

programs. We look forward to working on elements of each of each

of these bills in a comprehensive farm bill package. The National

Corn Growers believes that the conservation title of the next Farm

bill should focus on conservation practices of land in production

rather than conservation programs that take land out of production. Given scarce Federal dollars, we prioritize those programs

that provide financial assistance for conservation practices on land

in production.

National Corn Growers is interested in a new conservation program that assists growers in maintaining or undertaking new conservation practices in their farming operations. It is important that

these programs be implemented on ground that is in production

and will not become a set-aside program.

As we look at broader Clean Water Act issues and regulations

such as confined animal feeding operations, total maximum daily

loads, and hypoxia in the Gulf of Mexico, we know that corn growers play an important role in maintaining a healthy environment.

Agricultural producers face increasingly regulatory burdens whether it is local, State or Federal requirements on the management of

their land. We support programs that will work with our members

in utilizing conservation practices and work to maintain a healthy

environment.

Specifically, National Corn Growers has been focusing on legislation that would provide environmental incentive payments for

growers currently utilizing conservation practices on their ground

or will undertake new practices that provide conservation benefits.

The Conservation Security Act, a conservation incentive payment

program, reaches these goals. National Corn Growers believes that

the Conservation Security Act, working with commodity programs

and the past Farm bill conservation programs, allows for a new

focus on conservation. The Conservation Security Act is unique in

its approach because it recognizes an important part of conservation practice adoption across the farming community, which is that

growers need financial and technical assistance in the management

of their operations, based on conservation principles.

This is not always as easy or as obvious as creating and managing a filter strip along the waterway that runs through your land;

rather, it is the intensive management practices, or altering tillage

practices, that can become as much or more important in reaching

our conservation goals.

These management practices also add to the costs and risks of

the farming operations. These are the areas that need to be the

focus of the next farm will where policymakers work with growers

to find conservation practices that fit in with their management

and stewardship of the land.

6

The Environmental Quality Incentive Program, or EQIP, has

great goals of targeting scarce resources at the most significant soil

and water quality needs in each State. However, the targeting of

funds has been excessive, creating a very narrow program.

National Corn Growers supports changes that would broaden the

participation in EQIP and increase funding for both livestock and

crop sectors in the program. EQIP implementation should ultimately be altered to change the length of the contract, the ability

to receive payments in the first year of the contract, and eliminate

the size restrictions on animal operations.

Each of these conservation measures provides an integral part of

the overall conservation environment and water quality objectives.

Federal programs provide financial resources and technical assistance to facilitate the adoption and management of conservation

practices. Federal, State, and local cost-share and incentive programs are essential for the greater benefit provided by these practices. Our members are engaged in farming as a livelihood and

must maintain the ability to raise productive crops on their land

and market their crops to maximize profitability.

National Corn Growers recognizes the regulatory activity is increasing regarding livestock operations and manure management

and application. Regulatory actions in this area will have significant impacts on both our customers and the U.S. corn industry.

The U.S. livestock industry is the No. 1 consumer of domestic corn.

Just as we are concerned that the corn production could shift to

foreign countries, we are also concerned about livestock production

shifts to foreign countries. Both areas must be given the tools and

resources to comply with new regulations if we are to remain competitive in the global marketplace.

National Corn Growers closely monitors the speed at which new

land comes into production in South America. As set-aside and

acreage-idling programs in the United States increase, such as increasing the acreage in CRP, the rate at which land in South

American is cultivated increases. The United States cannot maintain a competitive advantage if U.S. regulatory activity forces up

production costs, if the U.S. transportation infrastructure cannot

deliver our goods to domestic and foreign markets in a cost-effective manner, and if the United States drives our customers further

from the point of domestic corn production.

All these elements must be considered when analyzing the impacts of domestic environmental regulatory activity.

As the committee continues its work on the Farm bill, we urge

you to take all of these elements into consideration. National Corn

Growers members strive to be good stewards of the land and must

do so in a manner in which they maintain their productivity and

competitiveness in global markets.

We see the pressures of environmental regulatory activity having

significant impacts on our domestic customers, the livestock industry, and potential impacts on row crop production. Conservation

programs must acknowledge these factors and work with producers

to undertake conservation practices on land in production while allowing for the flexibility for differing regional areas of production.

I thank you for the opportunity to testify.

7

Senator LINCOLN. Thank you, Mr. Klein. You made it before the

light came on; that was excellent.

[The prepared statement of Mr. Klein can be found in the appendix on page 30.]

Senator LINCOLN. Before we continue with the panel, I would ask

if there are any other Senators who would like to make opening

statements; if not, we can continue.

Senator Wellstone, I know that you will want to introduce one

of our witnesses. Would you like to do it now?

Senator WELLSTONE. I would be pleased to do it with Senator

Dayton; thank you.

Senator LINCOLN. Great.

Senator WELLSTONE. As my colleagues know, I could say a lot—

do I have about an hour to introduce Dave Serfling——

Senator LINCOLN. Don’t worry; we will turn the lights on.

Senator WELLSTONE. Dave is from Preston, Minnesota, and we

have known each other for a while. I have been to many Land

Stewardship Project gatherings, especially in Saint Dominick’s

Church in Northfield, Minnesota. His testimony will go to the heart

of what this question is about with conservation. He is a smart,

clear thinker, and smart, clear farmer who has a very diversified

operation which is very respectful of the environment, holds down

input costs, and is really an example of some of what is happening

in agriculture in southeast Minnesota especially. We see a lot of

focus there on land stewardship, and Dave represents the very best

of it.

Thanks, Dave. It is just great that you are here and much appreciated.

Mark?

Senator DAYTON. Madam Chair, I would just second what Senator Wellstone said. When Chairman Harkin was in Iowa last fall,

we had some meetings, and it was clear that the Land Stewardship

Project was already deeply involved with the chairman in developing the legislation which he has now introduced, which I am proud

to be a cosponsor of.

It is very appropriate that you and your organization are represented on the panel today, Dave, and I look forward to hearing

your remarks.

Thank you.

Senator LINCOLN. Thank you, Senator Dayton.

We will proceed now with Mr. Dunklin.

STATEMENT OF GEORGE DUNKLIN, JR., USA RICE

FEDERATION, DEWITT, ARKANSAS

Mr. DUNKLIN. Thank you, Madam Chairman and committee

members.

My name is George Dunklin, Jr., and I am a rice farmer near

DeWitt, Arkansas. I live near DeWitt. I do not actually live in

DeWitt. I live on the farm with my wife and my three daughters,

Megan, Hillary, and Lauren. We live on a working farm where we

practice conservation every day.

Madam Chairman, as you well know, in the rice industry, we require a lot of water. We conserve every drop of water on that farm,

8

literally. The systems that we designed on our farm are such that

we can do that, and it is very important that we do that.

We also flood our fields every winter for the migratory waterfowl

that fly in, the ducks, the geese, and what-have-you. We had, until

a big wind storm at Easter, a nesting pair of bald eagles. Over the

last nine years on our farm, which the Arkansas State Game and

Fish Department have documented, about nine eaglets have been

born. We take a lot of pride. Our children love growing up there.

My wife loves living there. We practice what we preach.

The U.S. Rice Producers’ Group has asked me to come today to

testify in front of this committee. The U.S. Rice Producers’ Group

is a charter member of the U.S. Rice Federation. I serve on the

Conservation Committee; I also serve on the Conservation Committee for Ducks Unlimited and also for the last nine years have been

chair of my local FSA office back home.

We have turned in our testimony, and today I would really just

like to go through the highlights of it instead of just reading it to

you.

What we would like to talk about today is this balancing act of

the conservation payments, whether they go for working land or

non-working land—sort of what Mr. Klein was talking about.

First, I would like to address the state of the rice farm economy.

We are not immune to low prices. Like other industries, since

water is one of our main components; fertilizer, nitrogen, is another

main component of our operation. Energy prices have certainly hit

us hard as they have hit everybody else.

Without a doubt, the emergency payments that you all have

made over the last few years without question have made a difference in keeping several of my friends in business. My banker

friends are able to continue loaning money. We appreciate what

you have done in the past, and we appreciate the work that you

are doing this year for this year’s funding, which apparently is

going on as we speak, and what is going on for next year. Without

those payments, simply, a lot of us would not be there.

Attached to my testimony are several examples of what we as

rice farmers do for what we call best management practices. Our

committee went to six different State to get examples of what we

are doing right now in the rice industry. They address improving

soil, water, air quality, and improving wildlife habitat.

What I want to talk about, though, specifically, is this balancing

act between the working and the non-working land. We also want

to comment on some of the other proposals that we have seen.

We do support all the existing conservation programs—the CRP

at the current level; the WRP program; the WHIP program; the

EQIP program; and the technical assistance that NRCS has given

us and what we hope they will give us more of.

We do not support the payment limitations on these conservation

program benefits. I just do not think we can get the work done if

we are limited in the amount of money. It is just not going to get

off the ground. There is so much work to be done.

Also, these conservation payments should not be a substitute for

existing or future farm safety net programs. We want them to be

voluntary-based, incentive-driven payments. We want them to be

science-based programs, and they need to be measured as such.

9

They need to enhance the rural economy and maintain private

property rights. They need to be designed to be WTO-consistent

and meet those ‘‘green box’’ measures that we have heard so much

about. I am not quite sure I understand all the green and amber

boxes, but I understand green boxes.

Something else that is important is the administration of these

on the local level. As I said, I have served for the last nine years

as chair of our FSA county committee. We would like to see these

come through the FSA office, the NRCS, where local farmers and

local producers are very much involved. They simply know what

works and what does not work in a local way.

Again, in short, we believe that careful balance between the farm

safety net programs and the conservation program payments that

are going to go to retire the land need to be considered, Madam

Chairman.

Again, we really appreciate your leadership, Senator Harkin’s

leadership, and this committee’s leadership in coming up with the

conservation title for the next Farm bill, that will help producers

to increase conservation and environmental benefits in America.

I for one, personally, am very excited about any new farm bill

that talks about and rewards land stewardship because frankly, in

the rice industry, we have been practicing land stewardship since

day one.

I will be happy to answer any questions, and I thank you for the

opportunity to testify.

Senator LINCOLN. Thank you, Mr. Dunklin.

[The prepared statement of Mr. Dunklin can be found in the appendix on page 35.]

Senator LINCOLN. Mr. Gary Mast, representing the National Association of Conservation Districts.

Welcome.

STATEMENT OF GARY MAST, NATIONAL ASSOCIATION OF

CONSERVATION DISTRICTS, WASHINGTON, DC

Mr. MAST. What a pleasure to be here, Madam Chairman, members of the committee. We appreciate being heard.

I am a sixth-generation farmer, and my 13-year-old daughter

claims that she is going to be the seventh-generation farmer. We

milk about 600 dairy cows, so I understand the AFO/CAFO rules

and all the challenges that those are bringing to us and appreciate

the wisdom of Senator Thomas in realizing that we cannot just

make all the rules in Washington, DC and expect it to happen out

on the local level. There needs to be some give and take and local

input.

I might also say that I have a son, too, and how many of you can

say that your son is playing in the State baseball tournament at

10 years old? He is going to be doing that on Saturday, so I am

pretty proud of that and of a very good wife who is an attorney and

keeps me straight.

I have been interested in conservation pretty much all my life.

My father put in wildlife areas and practiced conservation; we do

no-till; we grow the crops or the cows. I have been on the local Soil

and Water District board. I served on the State FSA committee. I

10

know the ins and outs of how these programs work and how they

work locally.

I am also here representing all the conservation districts across

the country. I am their vice president. We have been out there,

quietly doing the job, getting the technical assistance out there

along with our partners, NRCS, with the help of FSA. A lot of people do not know about conservation districts, but they are an extremely important force, especially up there in Wyoming; they do

a wonderful job up there.

As far as districts, I would explain it like this. If I am flying

across the country, if I am over private lands and you push me out

of the airplane, I will probably land in a soil and water conservation district. We are out there, covering this country.

In the interest of time, I would ask that my written statement

be inserted into the record. In my oral remarks, I want to focus on

three points—the challenge we face; what is needed for further

gains in conservation; and our preliminary assessment of the

House conservation title.

Our challenge—over the past several decades, we have made

some good progress in protecting our resource base. Progress is leveling off, and we still have a long way to go. In the recent farm

bills, we have created numerous new programs. The programs have

been pretty complicated, to say the least, and not real well-coordinated, oversubscribed, underfunded, and serve only a small percent

of land managers. It is where we fall the shortest. We talk about

EQIP; it is not available to too many land owners out there.

Too much energy is now focused on implementing programs rather than helping land managers solve conservation problems. Programs solve a lot of problems out there, but each community has

different, specific, small problems, many of which have to be solved

in a local level, so a Federal program probably will not help solve

those.

What is needed? We have spent two years in our own group putting our farm bill recommendations together. We had 1,700 district

people respond to that, so we feel like we have had a pretty good

core response, and we think we know what they need and want.

We heard the same message over and over again—current programs are important, but their reach is limited. We need a new incentive program that reaches all producers and all lands.

Conservation districts are very support of the bill that Senator

Harkin has put forth and feel that proposed programs fill a lot of

the critical gaps that we are missing. As a way to further strengthen the proposed program, we would like to see greater integration

with ongoing State and local government efforts. I guess that is

where we feel it may fall a little short; we would like a little more

local input.

We would also like to see the States have the ability to take care

of a lot of their own planning, rather than from on high telling us

all what to do.

As important as these financial assistance and land retirement

programs are, producers have even a greater need for technical assistance. We all know the work load that is coming down, and

there has to be technical assistance.

11

It is imperative that adequate resources be made available to

provide the technical assistance that producers have told us they

need. We have done surveys, and we should have 37,000 full-timeequivalents out there; currently, we have 15,000.

As far as the House conservation title, we have not had a lot of

time to check it out. We are pleased to see the increased funds. It

has a good beginning, but we are concerned about the underestimated technical assistance that it is going to take to administer

that program. I guess if anything, that is really what we are concerned about.

We would also like to say that NRCS should be the entity that

knows about conservation, and they should be not necessarily writing the checks but administering what the new Farm bill would be

over on the House side. That is the way we see it.

We feel very strongly that conservation programs should be managed by USDA’s conservation agency. They have the knowledge,

the technology, the experience, and the link with government. They

have the science. Farmers need a place to go that has the science.

I realize that I am running out of time. I would like to thank you

very much for the opportunity to be here. We believe that the incentive-based approach to the conservation bill will reach more producers and land in this country, provide more flexibility and local

control, provide significant public benefits in the form of better soil,

cleaner water, greater profits, and a brighter future.

Thank you very much.

Senator LINCOLN. Thank you, Mr. Mast, and you will have plenty

of opportunity to express yourself more during the questions. I

must add that I have 5-year-old twin boys, and we have not made

it to the State baseball tournament yet, but I guarantee you we

will be there one day.

Mr. MAST. It is coming.

Senator LINCOLN. Absolutely.

[The prepared statement of Mr. Mast can be found in the appendix on page 40.]

Senator LINCOLN. Mr. Serfling, welcome.

STATEMENT OF DAVE SERFLING, LAND STEWARDSHIP

PROJECT, PRESTON, MINNESOTA

Mr. SERFLING. Thank you, especially to Senator Wellstone and

Senator Dayton for their very kind comments. My wife does not

even talk that well about me. I really appreciate your comments.

My name is Dave Serfling. I am here today representing the

Land Stewardship Project, which is a member of the Sustainable

Agriculture Working Group and a member of the National Campaign for Sustainable Agriculture.

I would like to start by sincerely thanking you for all the support

that the Government has given my farm over the last five years.

Through the emergency payments, the AMTA program, LDP,

EQIP, SHOP, and SARE programs, I have been able to average a

little over $20,000 in Government subsidies on my 350-acre farm

over the last five years, and I really do appreciate it. It has really

helped my farm and my family.

We have beef, pigs, and sheep enterprises on our farm. We really

try to market all of our crops through the livestock. We have a 6-

12

year crop rotation of 2 years of corn, 1 year of oats with an underseeding, and 3 years of meadow which is either grazed rotationally

or hayed. We farm on gently rolling hills; about 85 percent of my

farm is considered highly erodible. It is good land, but it needs protection.

Farmers in my area have become very adept at ‘‘farming’’ the

Government program. Looking at the present program, the easiest

way for them to expand their crop subsidies is by expanding their

acres. Even during this time of terribly low market prices, we see

rising rental rates and increasing land values, which makes it even

tougher for young farmers to get started farming. Farmers are not

responding to the marketplace, they are responding to the Government subsidies.

A neighbor of mine who increased his crop acres significantly

said, ‘‘At least we know the Government is going to help the crop

farmers.’’ In our rolling hill,s the corn and soybean rotation has increased

dramatically. In the last two years, we have seen the worst soil

erosion on our land that I have ever seen. Even the most conservation-minded conventional farmers using no-till and strip-till tillage

have had severe erosion damage on their farms.

This last April 5th, we had an inch and a half of rain in less than

an hour during our snowmelt. We still had a lot of frost on the

ground, and the water could not soak in. I had damage on every

one of my cornfields. The only fields where I did not have damage

were my pastures and my hayland. The water just ran off the tight

sod.

I am a big believer in forages. They protect my land, they build

my soil, and they spread out my labor throughout the year; but it

is very hard for them to compete economically with program row

crops.

I am asking you today to consider a new type of farm program,

one that provides stewardship incentives on the land. Currently,

we are giving 85 percent of our conservation dollars to land retirement programs. I challenge you to envision a future where we

spent two-thirds of our conservation dollars on working lands. I believe that we can produce similar benefits as CRP gives us on our

working land and gives economic benefits to our rural communities

and our farmers.

I am a great believer in farmer ingenuity. If you tell us what environmental results you want on that working land and give us the

financial incentive to achieve them, the farmers will find a way to

deliver. That is why I am asking you today to support the Conservation Security Act.

The Conservation Security Act has three levels. The first level,

any farmer can participate in by using conservation tillage, nutrient management, integrated pest management. The second level,

the farmer has to be willing to incorporate a more complex crop rotation system than the traditional corn/soybean rotation. The third

level is where I really hope the farmer’s creativity can come into

play. This is where the farmer can sit down with the NRCS staff

person and use such techniques as whole-farm planting to really

individualize the conservation plan on his farm and really use some

farmer innovation.

13

One example in our area of southeast Minnesota—we have actually documented an improvement in fish habitat and water quality

by using controlled grazing on stream banks. This controlled grazing actually narrows the stream channel and deepens it. The end

result is better fish habitat and cleaner water.

The Land Stewardship Project is going to release a report this

fall on the multiple benefits of agriculture. This is going to come

out with some hard numbers on some of these benefits that agriculture can produce on their lands, ranging from reduced soil erosion to improved wildlife habitat to increasing social capital.

The Conservation Security Act is a major change in farm policy.

It rewards farmers for the conservation they do on their farms. It

is not a land retirement program. It is not going to affect the market or jeopardize trade agreements. It will give farmers an incentive to do conservation on their lands.

The CSA addresses all kinds of agriculture and moves us away

from supporting only the program crop acres. The CSA will sell to

your urban colleagues, and we need their support to pass this farm

bill. I ask that you fund the CSA at substantial levels so that every

farmer who wants to participate can.

Please do not tell farmers how to farm; just tell us what results

you want out there on the working land, and we American farmers

will not let you down.

Thank you.

Senator LINCOLN. Thank you, Mr. Serfling.

[The prepared statement of Mr. Serfling can be found in the appendix on page 52.]

Senator LINCOLN. Last but not least, Dr. Mark Shaffer from Defenders of Wildlife. Welcome.

STATEMENT OF MARK SHAFFER, DEFENDERS OF WILDLIFE,

WASHINGTON, DC

Mr. SHAFFER. Thank you, Madam Chairman and members of the

committee, for the chance to be here today.

My name is Mark Shaffer, and I am Senior Vice President for

Programs at Defenders of Wildlife.

Defenders is a national membership conservation organization

with about 476,000 members and supporters, and as you might

guess from our name, we are focused on wildlife conservation, the

maintenance of all wild plant and animal species in their natural

environments.

As you are well aware, agricultural land and agricultural policy

are terribly important to maintaining our national wildlife heritage. Let me give you just a few statistics to frame the issue.

Currently, the U.S. Fish and Wildlife Service lists more than

1,200 native species of plants and animals as threatened or endangered. The State network of Natural Heritage programs—and every

State government has a heritage program—lists another 5,000 or

more species as imperiled or vulnerable, species that could eventually end up on the endangered species list. Eighty-five percent of

all these species are in some kind of trouble because of the loss,

alteration, or degradation of habitat, and agriculture is the leading

cause of that habitat loss, affecting 38 percent of currently listed

species.

14

Despite that fact, 60 percent of the known populations of threatened, endangered, and imperiled species occur on private land, and

the vast majority of private land is in agriculture. Our chance to

save many declining, rare, threatened and endangered species is

going to depend on private landowners. We believe that voluntary,

incentive-based programs to encourage landowners, particularly agricultural producers, livestock producers, and foresters, to integrate

habitat conservation into their operations is a critically important

need in maintaining our wildlife heritage.

Producers face a number of choices in conducting their business,

but two are of particular importance to the future of our wildlife

heritage. One is where on their lands to produce, and the other is

how to produce on those lands they put into production. Both, we

think, are equally important to maintaining our wildlife heritage.

Defenders of Wildlife strongly supports the existing conservation

title programs—Conservation Reservation Program, the Wetlands

Reserve Program, the Wildlife Habitat Incentive Program, EQIP,

the Farmland Protection Program, and the others.

We do think that some changes are probably necessary and desirable in those programs as you move forward with reauthorization. We have submitted detailed comments with our written testimony about that.

We think the major limitations of these programs are that there

is not enough money in them, and they need to be expanded to a

broader range of agricultural and livestock producers.

We also recognize the existing conservation title programs are

really geared primarily to helping producers answer that first question—which of my land should I put into production?

CRP is really designed to encourage farmers to take highly erodible lands out of production. The Wetlands Reserve Program is

really aimed at helping farmers take valuable wetlands out of production or restore them where they have been put into production.

We think it is time to complement those very good set-aside programs with increased programs that help producers with the second question, which is how do I produce on the lands put into production. We applaud Senator Harkin and his cosponsors for introducing the Conservation Security Act, because we think this could

be a valuable addition to the Farm bill that would help provide

new programs that help producers answer that second question—

how do I produce—in a way that will maintain environmental quality and our wildlife heritage.

Why do we think that that is so important? Maybe conservationists have a reputation of focusing on the set-aside issue. We do

think set-asides are terribly important. It is part of the formula.

Helping producers with their management practices is incredibly

important, too, and let me give you a few statistics just to bear that

out.

Most agricultural land remains in production and will. No matter

how successful the set-aside programs are, we are not going to retire all the habitat we need to maintain our wildlife heritage.

Also, if you look at some species, aquatic organisms in particular

are affected by what goes on on the broader landscape; and if you

look carefully at aquatic taxi, you find out that our native fish species, our native amphibian species, and some of our aquatic insects

15

are endangered at a much higher rate than our native birds and

mammals and reptiles. Obviously, agricultural practices that affect

water quality and water quantity have a lot to do with that. Since

we are going to have most of our agricultural lands in production,

how they are managed is going to be terribly important to our

aquatic wildlife.

We recognize that having increases in the existing conservation

title programs and having a meaningful Conservation Security Act

will not be cheap. It would probably take $5 billion to put the existing conservation title programs to best effect. We have not seen a

scoring yet on the Conservation Security Act, but I would guess

that it would take $4 to $5 billion in that program to really fulfill

the kinds of objectives that have been laid out for that program.

The total together would be $9 to $10 billion, which is perhaps

40 to 50 percent of what is being talked about as agricultural support under this next farm bill. An investment in our environment

that benefits the producers is going to end up benefiting us all and

would be a wise investment.

Thank you very much.

[The prepared statement of Mr. Shaffer can be found in the appendix on page 57.]

Senator LINCOLN. Thank you, Dr. Schaffer, and thanks to all of

you for being here and adding your expertise to the debate that we

have before us.

Almost every one of you has mentioned the issue of funding. Unfortunately, it would be great if the sky where the limit for us up

here, but it is not, so our job is truly to, with your guidance as well

as your input, figure out how we can in the most wise way spend

the dollars that we have in a way that can be most beneficial to

you in the conservation that we want to achieve. The Farm bill

gives us that opportunity.

I will begin with just a couple of questions and then move to my

colleagues, who I am sure will have some as well.

One issue that comes up most often—and each of you brought it

up—as we talk about conservation policy is how to balance the reward for those who have already been engaging in good conservation practices against the incentives for those whom we are trying

to encourage to begin good conservation practices. We have talked

about, obviously, set-aside lands versus those lands in production.

Some people worry that we devote too much of our conservation

funds to offering incentives for new conservation practices, and we

slight those that have already been engaging in good practices.

Just to give you all the opportunity to be a little bit more specific

or to vet any more of your concerns that you may have, I would

like to ask everyone on the panel your belief, basically, or how you

approach the paying producers to maintain good conservation practices; is that a good investment? Some of you cite the need for supporting not only practices already being implemented but also additional practices. If you would like to be a little bit more specific on

some of the practices that you have in mind and what types of additional practices you might support—anybody?

Mr. Klein?

16

Mr. KLEIN. I will start. One thing we like about the chairman’s

bill is that it is tied to the producer and not tied to the land; it

does not come into land value.

Different that we have seen on the local—we do not have conservation districts in Nebraska, we have natural resource districts,

and the one that I am on is all or part of 15 counties; it is a watershed. We work with producers to have split applications of nitrogen, different types of tillage to keep as much residue and stop the

runoff. Residue management is a big thing. Buffer strips are a

huge issue in our State and are very popular around the country

now.

Those are some of the small things that have added up to a lot.

One of your questions was not taking away incentives for people

who are already practicing good things. It would be a terrible mistake to take it away from them and just give it to those people who

have not been doing it. We need to treat them all equally.

Senator LINCOLN. Mr. Dunklin?

Mr. DUNKLIN. What we do on our farm and what we have been

practicing for the last 10 or 12 years is a zero-grade system, meaning that we zero-grade our fields, we have water control structures,

and we virtually eliminate any soil erosion whatsoever. The water

that is going out of our rice fields is virtually cleaner than what

is coming into it. That is something that some of these moneys

could be going to to really incentivize the farmers and the landowners to do that more. Also, total water recovery systems, so we

are not nearly as dependent on the groundwater—which is a major

debate in our State.

As an example of what is going on right now, Madam Chairman,

in the Grand Prairie water irrigation—you sent down $22 million

last year—I have been amazed at the amount of participation that

that has generated from the landowners’ side. Just that incentive

has really caught fire. If you drive across the Grand Prairie now,

you see reservoirs and water recovery systems going in everywhere,

just because the financial incentive was in place there to do that.

Like I mentioned, water control structures, reservoirs to be

able—we get approximately 55 inches of rain in Arkansas, and a

lot of that water goes right down the bayou into the Gulf of Mexico—we need incentives to be able to capture a lot of that water.

These are just some of the systems that these moneys could go

toward. EQIP is one program that is already in place, but it is just

not adequately funded. We have to bid against our neighbor for it;

the payment cap knocks most of us out of that program. I have

never taken one dollar into our operation from EQIP because it is

just not worth it.

Senator LINCOLN. Thank you. I am going to followup on that

later on with one more question, Mr. Dunklin.

Mr. Mast?

Mr. MAST. The list could go on and on and on. Part of the list

should be comprised of the local people and their local needs.

As far as rewarding those who are doing a bad job, I do not

know—maybe I ought to go back and plow up my whole farm to

get ready for this so I can be rewarded.

Senator LINCOLN. We do not want to encourage you to do a bad

job.

17

Mr. MAST. No. I am making light, but I am trying to make a

point that it is very important that we reward those folks who have

been doing a good job and put a system together that does that.

Senator LINCOLN. Mr. Serfling?

Mr. SERFLING. I would like to second those comments. The EQIP

program is a good program to help fix the problems out there, and

right now, it is on a competitive basis, and it is a good program.

I guess I would like to see a little bit more discussion about the

percentage cost-share. It has been traditionally 75 percent, forever,

and yet you could stretch those dollars a little further if you would

play with that a little bit and drop it to 50 percent, and the farmers could have a little more ownership and a little more input on

the solutions to their problems; and then, maybe go up to 90 percent for beginning farmers and limited-resource farmers.

The Conservation Security Act is a new thing, and it is rewarding people for the environmental benefits. Right now, we are rewarding farmers to produce commodities that the marketplace does

not want, so we need to change that mind-set.

Senator LINCOLN. You mentioned in your testimony that you

thought two-thirds of the conservation dollars should go to the

working land as opposed to the set-aside.

Mr. SERFLING. Yes. I am a firm believer that we can produce the

same or very similar benefits or the environmental results on CRP

on our working lands if we adopt some innovative farming practices that we have out there.

Senator LINCOLN. Thank you.

Dr. Shaffer?

Mr. SHAFFER. Yes, Madam Chairman, with respect to your question on how we treat people who have been doing good conservation

versus others, there is another part to that which is also the universe of producers that the traditional programs have been geared

toward and have been able to reach.

We would very much like to see the existing conservation titles

more accessible to a broader range of agricultural producers—fruit

and vegetable growers, ranchers. There are some proposals afoot

for a grasslands reserve program which would be targeted toward

ranchers and somewhat equivalent to CRP, which we think is a

good idea.

I guess that would be our main recommendation is to try to

reach as many agricultural producers with these programs as possible.

Senator LINCOLN. Of course, as my grandfather used to say, ‘‘All

it takes is money.’’

Just to followup, many of you have mentioned EQIP, and one of

the most difficult issues that we are grappling with is how to restructure the Environmental Quality Incentive Program. Last week

during our hearing on animal agriculture, our panelists expressed

some very mixed views, some suggesting that we allow the livestock producers to be eligible for sizable funds to construct manure

storage facilities; others felt that very large payments might be

counterproductive.

In terms of increasing funding for EQIP, does anybody disagree

with that? As I said, all it takes is money. I cannot imagine someone wanting to cut some of those programs.

18

Mr. SERFLING. You do have to be careful. There are so many

economies of size in agriculture today, and we do not want to speed

up the trendlines or anything. One of the other things that the

large operations are doing is dumping some of their costs on society, whether it is through Government subsidies for manure storage structures, or whether it is odor that crosses the property lines,

and the neighbors have to live with it. There is a thing they call

‘‘externalities’’ now, and there is cost avoidance on these large

structures. We just need to make sure that they pay their fair

share of the costs that they are incurring for society.

Senator LINCOLN. Mr. Dunklin?

Mr. DUNKLIN. You talk about money and there being plenty of

it—obviously, there is not. It comes back to yes, we would love to

have all of these things, but we cannot forget the balance that I

talked about in my testimony—the farm safety net to the production. If we do not have the farmers there, who is going to deliver

these programs?

I know that that is the balancing act that you all are trying to

work with, and it is something that we are very concerned with as

well.

Senator LINCOLN. I appreciate that, and it is a very important

part of what we are all here to talk about.

Mr. Klein, did you have one more comment?

Mr. KLEIN. We did say that we wanted to remove the size limitation on EQIP, because now, on animal feeding operations, the large

operations are not eligible at all. Serving on a board where we are

the ones who end up saying who gets the funds, it is very competitive, and we would obviously like to see more funding for it. The

larger operations are not getting any of the funds today, and we

think they need them just as badly.

Senator LINCOLN. Thank you.

Thank you, gentlemen.

I want to make sure that I go by the Committee rules. We normally recognize members by their order of appearance.

Senator Hutchinson, please, from Arkansas.

Senator HUTCHINSON. Thank you, Senator Lincoln and Madam

Chairman, and let me point out that I have been told this is the

first time in the history of the Agriculture Committee, which began

in 1825, that a woman has chaired a hearing of the Senate Agriculture Committee.

Senator LINCOLN. Well, I feel very old.

[Applause.]

Senator LINCOLN. I must say my father would be proud.

Senator HUTCHINSON. We are, too, and it is another first, so congratulations.

Mr. Dunklin, in your testimony, you mentioned that the U.S.

Rice Producers’ Group proposes a number of principles which are

very, very helpful, but you mention in your testimony as well and

as part of these principles that ‘‘In order to strike a better balance

between conservation dollars devoted to retiring land versus working land, we do not support increasing the Conservation Reserve

Program from its current level to 36.4 million acres.’’ One of the suggestions has been that for existing programs like

CRP, new money that might be added to those existing programs

19

be targeted toward land that is in production. If it were so targeted, do you feel that that objection to additional funding for existing conservation programs would still be there?

Mr. DUNKLIN. You are talking about the objection to—— Senator HUTCHINSON. To increasing the acreage from 36.4 million acres if additional funding and additional acreage were targeting land that was in production.

Mr. DUNKLIN. You are talking about retiring land from production to the CRP—am I following you?

Senator HUTCHINSON. Well, my understanding, at least, is that

in Senator Crapo’s legislation—and I will let him talk about it; he

knows it far better than I do—while he would increase the acreage

from the 36.4 million, new acreage would be for conservation programs that he would really refine existing conservation programs

to ensure that they are addressing land in production as opposed

to taking it out and setting it aside.

If it were so modified, would that address your concern about—— Mr. DUNKLIN. You are talking about buffer strips, I assume.

Senator HUTCHINSON. Exactly.

Mr. DUNKLIN. A targeted type, no; we certainly would agree

there are definitely some places where that would fit. We are talking about mainly widespread, taking out good production land that

is viable—not marginal land, but we are talking about good production land—and just retiring it because there is a Government program, like Mr. Serfling referred to ‘‘farming’’ the program. That is

what concerns us.

Senator HUTCHINSON. OK. In your testimony, you used the word ‘‘balance’’ a number of times, and that is our great challenge. Most

of us like the kinds of things that the chairman has proposed in

his proposal. The concern will be how do we balance the funding

and whether that is going to erode our ability to fund adequately

price support programs or whatever it might look like in the new

Farm bill—whether it is an AMTA payment or whether it is something else.

My understanding is that the cost of the chairman’s bill will be

over $40 billion over a 10-year period. We are spending $73.5 billion over 10 years. I would like a sense of the support there is for

existing support programs, whether they are modified or not, but

that price support, and for the existing conservation programs, and

how much concern there is that should there be a new program

created, the risk that there may be in eroding the funding for the

existing programs we have, both conservation and price support.

Mr. DUNKLIN. I guess that gets back to the total amount of dollars and how we work that. I hate to keep using the word ‘‘balance,’’ but it keeps getting back to striking that balance between

the farm safety net, which keeps our producers there, and the

amount of money that has to go there, and these new initiatives

that you are talking about that we have to fund on top of the current conservation programs which I testified that we agree to and

concur that they are very important.

I guess it is where those funds are going and how much they are

going to be and how much is being taken away from the current

farm safety net that is going to take money from that to fund

these. That is what concerns us.

20

Senator HUTCHINSON. That is what I wanted to get on the

record. If this were all additional funding for a supplemental program dealing with the conservation and land in production, we

would all be for that if we were able to do that. If it is a threat

to the funding for existing programs, how much concern is there?

Maybe I will let everybody address that.

Mr. Mast?

Mr. MAST. I would say that we have some awfully good tools in

the toolkit right now. I would hate to see those go by the wayside.

As far as myself personally, just so you get a little understanding

of what is going on out there on the farm, I rent probably 20 different farms, and lot of these farms have come up in the last 3 or

4 years. They were not part of the farm program. I am getting zero

dollars of Government help from those. I farm a lot of acres, but

I do not get a lot from the Government. In my particular case, if

I am doing conservation practices now on those farms, I would assume that I would get some more help. I am just telling you this

as one scenario.

Going back to one other question, if CRP happened to be increased, if we could target that toward riparian areas and buffer

zones, we could really get bang for the buck.

Senator HUTCHINSON. Good. Thanks.

Dr. Shaffer?

Mr. SHAFFER. I guess the way I would look at it, Senator, is that

I agree with the gentleman who just said we have some proven

tools in the toolbox; they are working. We need to hang onto those.

As far as the question of balance, we have to look at the whole

spectrum of agricultural payments and what they are going for and

not just look at whether CSA is a threat to the conservation title

or vice versa.

There is the issue of what the Congress plans to spend and then,

what we end up spending through the emergency supplementals

and so on. I do not have the precise figure, so correct me if I am

wrong, but that last year, we probably spent close to $30 billion

total on the various programs, and that was far in excess of what

was planned at the time.

If we are looking out over 10 years, and we are saying we are

planning to spend $79 billion with the current programs, some of

which may not be doing an effective job at curtailing the underlying problem of overproduction relative to market, then we have to

ask how are we going to spend these moneys in a way that does

support the farmer, particularly the family farmer, and give him

some predictability, and not end up feeding into an overproduction

cycle that hurts the farmer, hurts the market, and frankly, hurts

the environment.

Mr. MAST. I have a question to you folks——

Senator HUTCHINSON. Address that to Madam Chairman, please.

[Laughter.]

Mr. MAST. Madam Chairman, is the $74.5 billion over and above

what our baseline funding is right now?

Senator LINCOLN. Yes.

Senator HUTCHINSON. Yes, it is.

Mr. MAST. This would be new dollars.

Senator HUTCHINSON. Thank you, Madam Chairman.

21

Senator LINCOLN. Senator Wellstone?

Senator WELLSTONE. Thanks, Madam Chairman.

One thing that occurs to me on this whole question of balance— and I will pick up, on what Dr. Shaffer was saying—is that I am

not so sure that this is a zero-sum game; that if in fact we move

forward on conservation credits, we therefore move away from CRP

and other conservation programs. Quite to the contrary, we can do

both.

Now, maybe you want to make sure that CRP is truly for erodible land; maybe you want to make sure that farmers cannot take

out whole counties, which then do in a lot of businesses in the area.

There are ways of targeting, and there are ways of making it work

better, and I do not believe that we are in an absolute zero-sum

game, one versus the other. As Dr. Shaffer was mentioning, I do

a lot of work with Pheasants Forever and Ducks Unlimited, and

both programs are very important from the point of view of wildlife. I am not ready to say that moving forward with a focus on

those farmers who have the land in production and are doing better by way of incentives is somehow going to subtract from some

of the good work that is being done with existing conservation programs. In terms of economic resources, I do not think it is automatically a tradeoff, and I certainly think, conceptually and policywise, it is not, just for the record.

Mr. Serfling--and others can respond as well—you said that if in

fact we had some changes in our farming systems, is the way you

put it, there would be multiple benefits in rural communities. You

have listed some of them, and one of them was social capital. I

would like for you to develop that point a little further.

Mr. SERFLING. I am a proponent of small family farms, as you

probably gleaned from my testimony. Basically, if we can put a

family farm on every 360 acres, and it is middle class and feeds

that family, compared to one family farmer on 2,000 acres with a

bunch of employees—and we do not pay people very well in agriculture—there is a tremendous amount of economic benefit, but

there is also a tremendous amount of social benefit to the community that it supports.

Our country is built on a strong middle class, and our small rural

communities are built on a strong middle class, and we are losing

that middle class in agriculture. We are getting a very small upper

crust and a very large contingent of small wage earners in our communities.

There are types of agriculture where we can diversify and make

good livings on smaller tracts of land, and then we will have some

increases in social capital. One of the studies coming out this fall

is going to try to put some hard numbers and measure that, because we do have places in the country where that type of farming

is still prevalent, and we can measure the social capital that comes

to it.

Senator WELLSTONE. Dave, isn’t there a classic study that was

done years ago that looked at the relationship between the number

of family farmers who actually live in the community—in other

words, somebody is going to farm the land, and somebody is going

to own the animals; the question is how many family farmers live

there in the area. There was a classic study of that kind of commuVerDate 11-MAY-2000 08:58 Jan 31, 2003 Jkt 084112 PO 00000 Frm 00025 Fmt 6633 Sfmt 6633 84112.TXT SAG1 PsN: SAG1
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nity versus the community where most of the decisionmaking is by

absentee investors. You are right on the mark.

Madam Chair, as my final point, I would like to see the very

strong focus on conservation and land stewardship that we will

have in the bill linked to an emphasis on family farm structure of

agriculture—that is to say, the people who make the capital investment decisions are the people who live on the land; they are the

entrepreneurs. For my own part—and I was kidding Pat Roberts

the other day—I would also like to see that linked—although I am

not sure that our committee has all the jurisdiction over this question—we can deal with some of packers and stockyards—I would

also like to see more competition in the food industry. I would like

to see us put a little more free enterprise back into this system so

that our independent producers can get a fair shake, which is also

critically important.

Thank you.

Senator LINCOLN. Thank you, Senator.

Just for the benefit of the witnesses, this committee has been a

very bipartisan committee in the past. One of our biggest challenges is the differences in our demographics, and obviously, a

large farm in Minnesota might be very different from a large farm

in Arkansas. That is one of the other challenges we have here on

this committee is to recognize that there are many differences in

the farming operations that we have across this country.

Senator WELLSTONE. True enough, although that is why I put my

emphasis on the actual pattern of investment and decisionmaking.

Senator LINCOLN. I will also apologize to my colleague. I am not

sure if I am following the actual pattern in the committee; I know

that in Finance, where Senator Thomas and I serve, we go by the

order of appearance, so I would like to recognize Senator Thomas

now.

Senator THOMAS. I get the last word. Thank you, Madam Chairman.

Many of the things that I am concerned about—and you have

talked about some—but you are here on a specific mission, and so

are we, but when we get to it, we are talking in a broader sense

about agriculture. We are talking in the broader sense about a

farm bill that is not just conservation; it is lots of things.

It seems to me that our challenge is to take a look at where we

want agriculture to be in 10 years, 15 years. You have to take

those things into account, and one thing that seems pretty obvious

is that in the past, farm bills have been basically oriented toward

program crops—basically, you raise so many crops, and if the price

is not good, you get paid for it, or a loan program. Now that is

changing. We are looking now, and there is lots of interest in

broadening this. We are talking about apples and cranberries and

everything else being in the farm program. It is going to be different than it has been in the past. We are also facing a whole different market situation in the world.

I guess I would simply challenge you to say where do we go with

the total farm program; do we in fact move toward having more

support for a broader base in agriculture as opposed to rice and

corn and those specific program crops?

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Mr. Dunklin, you are indicating that you would like to have both,

and I do not know whether you can go that way. Is that what you

want? Can you see in the future where you still encourage people

to raise more and more of the crop, whether it is marketable or not,

by having support programs, or do you go to spreading it a little

more broadly so the basic support for agriculture is there, but without encouraging increased production? I do not know the answer.

Mr. DUNKLIN. I personally like the second measure you mentioned. One thing I have liked about Freedom to Farm is the fact

that we have had the freedom to plant for the market instead of

being told or being required to plant so much percent of your base

in rice—even if you were going to lose the money, even if it was

not profitable, you still had to plant to protect the base.

The second alternative is one that I like. I like Senator Wellstone’s comments about entrepreneurship in agriculture. That is

something that we do not hear about very often.

Senator THOMAS. He is talking about processors, I believe.

Mr. DUNKLIN. OK, but I want to put that to producers. I know

that in our own operation, we do not farm by the book. We have

kind of written our own book as we have gone along. We have done

it in a way that with no-tillage, we have reduced our equipment

needs, our labor needs. We have taken a lot of our risk by the systems that we have put in, our zero grade systems, which are all

environmental and conservation-minded. We have not been rewarded for those directly at all, but we have been rewarded

through the farm safety net features that were there. We have

done quite well with those in the nineties by putting these systems

in. We have reduced our energy consumption, our water consumption, our repair bills, our risks that we have to weather.

The ideal system would be one that had the safety net, that

would eliminate the caps. Caps have been very troublesome in our

operation in rice and cotton, which Madam Chairman Lincoln is

very familiar with, which is different from Minnesota and these

other parts, because it does require that we do other things that

do not really make a lot of sense, and we spend a lot of work trying

to figure out how to do it, how to ‘‘farm’’ the program, instead of

just farming and being good businessmen.

In the conservation systems, we are basically doing a lot of these

best management practices without any incentive.

Senator THOMAS. Why do you want to do that, then? Why don’t

we just leave those alone?

Mr. DUNKLIN. Well, we would like to be rewarded for them. If we

are going to be competitive——

Senator THOMAS. We cannot reward you for everything you do.

Mr. DUNKLIN. No, sir. I realize that.

Senator THOMAS. We can reward you by guaranteeing you a price

so that you can produce more and at the same time reward you for

other things.

I come from a State where livestock is the issue. How about

those folks? Don’t they deserve something as well? How are we

going to keep the small rancher in place? He does not get a guaranteed price. He does not do those things.

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What I am challenging you is to think about how you want agriculture to be over time, and what should be in this farm bill to

move it.

Mr. DUNKLIN. Yes, sir. Over time, it needs to be market-driven,

without any question.

Senator THOMAS. I agree.

Mr. DUNKLIN. Madam Chairman well knows the problems that

we have had with Iraq, with Iran, and with Cuba, with these markets being closed where our biggest rice markets are. We have no

control over that. If we did, we would open them all up.

Senator THOMAS. Yes, we have some big problems with—— Mr. DUNKLIN. Yes, sir—but keep us viable until we get those

markets open.

Senator THOMAS. Let me ask if anyone else has a comment.

Mr. SERFLING. If I could say, your ranchers produce a lot more

than just cattle. They are taking care of their land. They are producing a landscape—a beautiful landscape when you drive through

Wyoming—and they are not getting paid a dime for that.

The Conservation Security Act addresses all parts of the country

and encourages diversity and recognizes some of those nonmarket

benefits that your ranches are producing. That is why it is a big

change, and it is not going to come easily; I am afraid you are

going to have to fight for it, and we are going to try to help you

as much we can.

Senator THOMAS. There is pretty good support for it. It is going

to be basically at some point a question of how involved you want

the Federal Government to be in this industry, how much money

is it going to take to do this, and over time, do we want to continue

to grow the Government’s role in agriculture, or don’t we? I do not

know. That is the question.

Yes, sir?

Mr. SHAFFER. If I could make a comment in reply, Senator Thomas, you asked where do we want agriculture to be in 4 years. I

would submit that there are probably four characteristics that we

would like it to have over the next 10 years.

We would like to see it be diverse, we would like to see it be sustainable, we would like to see it be responsive to the market, and

we would like to see it be globally competitive.

We think that a larger investment in the conservation programs

to a broader range of producers is the way to ensure that those four

attributes are there in 10 years. As long as the supports or rewards

are predominantly geared to a handful of crops that represent an

important segment of the agricultural industry, but only a segment, how are we going to give people the freedom to really make

decisions about what they want to produce if they know that the

only safety net is for a certain group of things?

That is why we stress an emphasis on conservation, because that

is an important thing that farmers, ranchers, and foresters—we

have not talked much about forestry here today—can really affect

to benefit all of us.

Mr. MAST. That stewardship rewards will certainly get money

into the farm economy, but also is much more saleable to the public. If they feel like they are getting something for the dollars they

are putting in, rather than just a handout, that is probably the diVerDate 11-MAY-2000 08:58 Jan 31, 2003 Jkt 084112 PO 00000 Frm 00028 Fmt 6633 Sfmt 6633 84112.TXT SAG1 PsN: SAG1
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rection in which we need to go if we need help in producing our

food.

Senator THOMAS. Some people may have to pay a little more for

what they eat, too.

Mr. MAST. That would certainly help.

Mr. KLEIN. I would like to see that crystal ball that tells us

where agriculture will be in 10 years. Someone mentioned that

they thought the optimum farm size would be 350 or so acres. The

amount of labor that it takes anymore to raise a crop has gone

down significantly. When I look back 30 years, 20 years, and 10

years ago, it is amazing how little time it takes to raise 1,000 acres

of corn compared to what we used to do.

For the future, we have got to develop new uses for agricultural

products. We have got to get the agricultural producer closer to the

grocery store shelf and closer to the consumer. That has got to be

the answer. New uses like ethanol—ethanol has been a tremendous

example, and—Senator Wellstone is not here—Minnesota has had

the farmer-owned cooperatives and has been at the leading edge on

that; it has been a success story that I hope continues. Research

has to be done into what we can do with our products. The foreign

markets are important, and we need a better transportation system

in this country to get our products out.

As far as livestock, we are in the calving season right now, and

I can assure you it is a good time to be done.

Senator THOMAS. One thing that is happening in Wyoming in

livestock is that they are trying to get a lamb coop. There is such

a difference between the price that the producer gets and the retail

price.

My final point is that we really need to take a look. We are writing a new farm bill which will hopefully put a new direction in agriculture—or at least, that is the opportunity that we have—the

input that you have given us is very good, and I appreciate it.

Senator LINCOLN. Thank you, Senator. I have just figured something out. Every morning when I pull into the garage in the Dirksen Building, I see a great bumper sticker that says: ‘‘Eat More

Lamb—10,000 Coyotes Can’t be Wrong.’’ Is that yours?

Senator THOMAS. That is what it says. I do not mean to pull the

wool over your eyes, of course.

[Laughter.]

Senator LINCOLN. I would like to wrap this up and give the panelists an opportunity to make any further points they would like

to, but I just have to get in a few last comments of my own.

We are the producers of the safest, most abundant and most affordable food supply in the world, and we do it in the most environmentally sound way of any other country on the globe. For all the

faults and certainly the things that we want to correct and we

want to improve on, I hope we can recognize that we have done a

pretty good job so far.

There are definitely differences that we want to point out from

the Agriculture Committee’s standpoint, and that is why each of

the States have two representatives here in the U.S. Senate; and

we try very hard to point those out.

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Mr. Dunklin brought up issues in terms of trade, which are critical. Senator Thomas and I deal with those on the Finance Committee.

I am sorry that Senator Conrad is not here, because he usually

has a great chart to share with everybody, and one things that

sticks in my mind is the fact that well over 80 percent of the export

subsidies in the world are consumed by the EU. The fact is many

of our farmers are not competing with other farmers globally; they

are competing with other governments. That is why I go back to

one of the other things that has been brought up in many of your

testimonies, and that is a good balance—a balance of our being

able to compete in terms of production and being able to compete

in a global marketplace, balancing that with what it is that we ultimately want to achieve, and that is good conservation measures, a

sound economy, and a sound environment.

We have that duty here, and we are going to be calling on many

of you all to be able to do that. Mr. Klein mentioned Brazil in his

earlier testimony. I can remember talking to some of our farmers

in Arkansas who finally realized, unbelievably, that they were competing with Brazil after we had seen some major infrastructure investments down there for transportation to get their products to

the global marketplace, not to mention some of the technology that

we have already shared.

We have been very generous as a country to the world economy,

and it is very important for us in addressing this in the Farm bill

that is up and coming, that we recognize this, and that we do create a good balance between the safety net that we can provide

these great farmers and producers who are providing that safe and

abundant and affordable food supply.

I also hope that we will not miss the opportunity to address the

issues of biomass, the diversity that is out there, the ability for us

to look at those issues, but also look at them on a local level. In

ethanol for us, there are many opportunities in terms of rice hull

and rice straw in production of ethanol that give us not only an opportunity locally to do something with our biomass, but also to encourage a greater use of ethanol. Because of difficulties putting it

in the pipeline, obviously, if we can create more local interest in

what we are doing in biomass, we are going to move the efforts at

using ethanol in a much quicker fashion.

There is a lot that we can do. Just one last thing—Mr. Dunklin

brought up the issue of payment limits and his opposition to that.

Again, we do have pretty capital-intensive crops in our area. Some

of those are a little bit different from that others may do. Last but

not least, it will not work unless we have the input and involvement of local landowners. Many of you have touched on that. If you

have any comments on how we can better design, any thoughts

about how our Federal conservation programs should be designed

to facilitate what is done at the local level in concert with the State

conservation efforts, certainly we would appreciate hearing from

you if you have seen something that you think is very noteworthy,

or if you have ideas about how we could better integrate with the

State and the local issues.

Are there any comments on that?

Mr. Shaffer?

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Mr. SHAFFER. Madam Chairman, last year and this summer as

well, Defenders and some partner organizations brought together

groups of producers in the State of Oregon to discuss this. Now, it

is a little Oregon-specific, but nonetheless we have reports from

those workshops that tried to identify what is working, what is not

working so well, what could be changed—and these are obviously

primarily with regard to the conservation title—and we would be

happy to share those with you and the committee.

Senator LINCOLN. That would be excellent. Actually, there have

been several other situations in some States where they have had

those local meetings to better work out what is going to be the

most efficient way of implementing what it is we want to do in

order to achieve the results.

Are there any other comments from our panelists?

[No response.]

Senator LINCOLN. We appreciate very much your time and, more

importantly, your interest and enthusiasm on this issue. It is going

to be a critical part of what we do in the upcoming Farm bill along

with many other issues that are going to be involved.

I will remind you that, as my grandfather used to say when he

would take me to the Dairy Queen when I was little, ‘‘The sky is

the limit, but you can only spend a nickel.’’ We wish the sky were

the limit here, but it is not; we are going to have to make some

delicate balances, and we will be calling on your frequently to help

us make the right decisions.

Thank you very much.

The Committee on Agriculture stands adjourned.

[Whereupon, at 10:52 a.m., the committee was adjourned.]

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