Date: 1981-12-15
Speaker: F ERRARO (democrat)
Chamber: H

Mr. Speaker. the weekend of November 13. I1 had the opportunity to visit the State of South Dakota as the guest of the Sioux Valley Empire Electric Association. the rural electric cooperative that serves southeastern South Dakota. My good friend Tom DAscHLE and his staff were also extremely helpful In plan*ning -my stay and making it -a very Informative and pleasureable experience. I want to share a bit of that experience with by colleagues tonight.. To tell the truth. my initial reaction to the Invitation I received from the Sioux .Valley. people was "~South Dakota? Me? Why?" I had never been to South Dakota. I had no experience with the rural electric cooperatives. In fact. as a Representative from Queens in New York City. I had not much experience with rural anything. Still. I welcomed the opportunity. to visit South Dakota to see how the farmers of our Nation live. It didnt take a lot of time to determine there were a great many differences between the. First Congressional District. in South Dakota and the Ninth Congressional District in New York. But a quick check on some basic facts and figures also showed some amazing comparisons..Congressman DAscmE has a d istrict that. covers over 15.000 square .miles. Mine covers roughly 20 miles. The dis.tance between his- district offices in .H19700 Sioux Falls and Aberdeen -Is greater than the distance between my. New~ York office and my Washington offire. .Tom has. thousandsi of. farms In his district. covering millions of acres. I learned from -the New York Department of Agriculture that In 1972. the last time. anybody bothered to check. there were exactly 13 farms In all of Queens Countywhich comprises not only my -congressional district. but three whole and three partial congressional. districtsand they covered about 15 acres. I have 22.000 consumers In a square mile in my district to his four farmers per square mile. Another .difference emerged .from the materials that had been provided by the Sioux Valley Electric people regarding the service they offered. Sioux Valley has an average 1.72 consumers per mile of line. That compares with Con Ed In New York. which has almost 70 consumers per mile of line but lines are duplicated and triplicated so the figures are much higher. So It was clear there were differences. But. of course. t here were also similarities. beginning with the fact that while New York city is not exactly loaded with prime agricultural lands. much of New York State Is heavily agricultural. so as I learned about South Dakotas agriculture. I also learned some things about New York agriculture. One of the things that I must admit surprised me was* the fact that. contrary to any general impression of South Dakota as a farm State and New York as an industrial State. there Is very little difference between total agricultural production In the two States. In fact. according to the USDA. New York ranks 23d In agricultural receipts. and South Dakota ranks 22d. But there were other simillaritli as well. Similarities in the type- of people who live in the First District of South Dakota and the Ninth In New York. Similarities in the problems they are facing today. Similarities in how theyhave attempted to solve their problems. I would like to take just a few minutes to talk about some of the things I learned in South Dakota. The first stop was the Earth Resource Observation Service (EROS) Center.-EROS was the first example I would see of the concern of South Dakotans for the future. What they do. and .It was fascinating. is to use remotesensing techniques to monitpr Earth resources. Remotesensing techniques can be used for inventorying the Earths resources. Including oil. gas. copper. and other minerals as well as water. It has been used to detect changes in the land to monitor strip mining and reclamation of strip mines and. for gaging the environmental. impact of the Alas-. kan pipeline. Its a greattoolifor keepIng track of whats happening. to the Earth so we can make. the most of our resources while. Protecting them for future generations. On Saturday. the second day of my visit. -I had -the. chance to visit with three South Dakota farm families. Basically. the -conversations I had with the three familiesthe Knutsens. the (3erringers. and the Hallsprovided the greatest evidence of the fundamental similarities between South Dakota and Queens. In rural South Dakota. and In urban and suburban Queens. the people basically wanted the same thing from their government. Not a handout. but an honest chance to make It on their own.. Throughout my stay. I was amazed at the similarities between the Norwegians of South Dakota and the Italians and Greeks of Queens. All hardworking. family oriented people. What they did for a living differed. but their willingness. and their desire. to work for a living was the same. And their problems were the same. An erratic economy that keeps the costs of doing business high. forces unemployment.- in. Queens. and forces farmers like the Knutsens. Qerringers. and Halls to borrow. borrow. borrow against the everrising value of their land. because its. the *only way they can keep going. As a matter of fact. In a recent Washington Post. far from Bruce and Bushnell. South Dakota. there was a report of a new study which found that American farmers are in serious trouble because of debts exceeding $160 billion. I can pretty much guarantee. you that those South Dakota farmers had not read the Post. and I doubt whether they have heard of the Cornucopia Project. which conducted the study. But they can tell you more than you would ever want to know about the problems facing farmers who have borrowed to . the hilt against their farms and who are fighting a constantly uphill battle because of lowmarket prices for their crops and highproduction costs for feed. and fuel. and supplies. In fact. with regard to lowmarket prices for crops. Cec Hall gave me some numbers that are really stunning. We have all seen the commercials that IBM runs -on television saying that if prices generally had declined in recent years in real terms the way computer costs have. steak would cost a nickel or so a pound. and a suit of clothes would cost $10. and everything would be pretty terrific. Well. when Cec Hall started farming In 1947thiat Is -34 year agothe price of cornmas $2.40 a bushel. Today. it Is $2.05 a bushel. And those figures are not in.- constant dollars. Actually. If you adjustthe figures to reflect the change. in. the consumer price Index since. 1947. that $2.05 a bushel that Cec Hall is getting is really worth less than 52t a.bushel. And the $2.40 he got In 1947. if It had. kept up with the CPI. would now be $8.85.. .. .What truly astounded me about the prices the farmers are getting for their crops and their financial problems Is the fact that food prices are a major Issue In New York as well. but for exactly the opposite reason. A big part of the increase In the consumer price index In recent years.has been increases In food prices. The cost of living in New York is the highest In the country. and food prices have a lot to do with it. Too many middle class and working class families In New York. for whom sirloin used to be affordable. are now finding hamburger a luxury. It Is a terrible situation. The people growing the food are going broke trying to stay In business. and the people who need the food are going broke trying to buy It. Clearly the high prices being paid by my people In New York are not doing the farmers any good. but somiebody somewhere Is making money. Part of the problem lies In transportation costs. The Washington Post article to which I referred earlier reports that for every $2 spent growing food. another $1 is spent transporting It. and all that gets passed on to the consumer but does the farmer no good. While rising energy costs plague everybody. farmers and consumers alike. at least the farmers know they can eat when times are tough. For my people. particularly the elderly and the poor. the approach of winter may mean a choice between freezing or starving. None of us. from any part of the country. can turn our backs on these Issues. My trip to South Dakota has helped me understand the problems facing farmers. and to see more clearly how they contrast with the problems facing my people In Queens. I do not have the solutions. but I do have a better picture of how things work. Interest rates a re a particular killer for family farms in South Dakota. just as they are for small businessmen and women In Queens. Melvin Knutson cannot afford to replenish his pig stock because he would have to borrow the money to buy the pigs. and the Interest payments on the borrowed money would be more than his profits on selling the pigs after he paid for feed and other expenses. The problems these farmers are having making a living lead to other problems in rural America. Because it is so tough to make a living. and because the only thing they have that keeps its value is their land. they are frequently tempted to sell the land and move to the city. This causes several problems. The only people who can afford to buy land at todays prices are big corporationsthey are called "faceless farmers" In South Dakota. They buy up the land. grow whatever they. can make the most money from on It. and either pocket the profits or write off the losses against their taxes. The result Is the degradation of fertile -&&ember 15.1981: cropland. which Is one of the most se- tees. the section 312 loansare Investrious problems facing all Americans ments In America. Investments. In today. and. the centralization of con- people. It might be a little hard to see trol of agriculture. which can only at first. but the connection between lead to price manipulation that costs the wellbeing of farmers In rural my people in New York money In South Dakota and municipal employee higher grocery prices. union members in New York City Is Another problem caused- by the soar- much closer than we normally think. ing land prices is that young people It is a little strange. but that weekcannot afford to buy land to get start- end. while 0MB Director David Stocked. It Is really a sickening parallel to man was in the headlines for saying the probim of young people In my some things I agreed with. I was district who cannot afford to start a thinking of something he had said business or buy a home because they months ago. that I strongly disagreed cannot get the money. . with. In any event. the consolidation of In February. the ReaganStockman land ownership by large corporations duo submitted to Congress their bookis a growing problem. The Cornucopia let of budget cuts titled "Americas Study found that 1 percent of farm- New Beginning: A Program for Ecoland owners control 30 percent of the nomnic Recovery." farmland. and the trend Is worsening. In the section titled "Applying The last subject I wanted to discuss Sound Criteria to Economic Subsidy Is my meeting with officials of the Programs." on the subject of mass Sioux Valley Electric Cooperative. The transit operating assistance. Mr. Rural Electrification Administration Stockman wrote. 11. .. there Is no was one of the prime targets of the reason for someone In Sioux Falls to Reagan budget cutting program. pay Federal taxes so that someone In Thanks In large part to the efforts of Los Angeles can get to work on time Tom DAscHiLE and other rural repre- by public transportation." sentatives. most of the REAs func-- Well. I guess they could Just as well tions were saved. have said theres no reason for someBut what I came to understand one In Los Angeles. or New York to while I was In South Dakota was the pay Federal taxes so someone In Sioux absolute shortsightedness of the at- Falls can benefit from rural electrfintempt to cut REA. It may be that REA cation. or commodity price supports. Is more responsible than any other or federally suibsidized irrigation .projagency for the prosperity of rural ects. America. And they would have been Just as REA. I learned. Is In the business of wrong.guaranteeing loans to local coopera- The fact is we are all in this togethtives. and the loans are repaid. with in- er. Just as the people of New York terest. I was remidnded of the New depend on the farmers. of South York City loan guarantees. which also Dakota to provide their food. the Were repaid. In full. on time. with in- farmers need the people of New York terest. as a market for their products. And There is another parallel betweeni the subway service that seems Irreleeconomic conditions In New York City vant In Sioux Falls is critical to New and In South Dakota that strikes me Yorkers getting to work each day. so when I consider REA. The REA oper- they can afford to buy the products ates on lowinterest loans. One of the produced on the farm. I most serious problems facing many The point. I guess. Is that we too neighborhoods In my district Is the de- often think In terms of rural versus terioratlon of older housing. urban. or Sunbelt versus Snowbelt. There has been a Federal program. a What I have learned Is that Its too lowinterest loan program like REA. easy to concentrate on our own probthat has dealt with this housing prob- lems and Ignore the problems facing lem in New York and other cities. The people In other parts of the country. section 312 program provided home- If we are going to achieve economic owners with money at below market prosperitk forIal we are going to have rates so they could make home im- to pull together. provements that not only Increased There Is one last thing I want to the value of their homes but also kept mention. their neighborhoods pleasant places to The conference report on the farm live. bill will be on the floor tomorrow. and Unfortunately. the 312 program did It provides a. perfect example of the not fare as well in the budget cutting reasons consumers and producers alike as the REAs did. As a result. many are dissatisfied with the current state homeowners In Queens face a problem of our farm economy. The conferees totally alien to the farmers I visited. decided.. against the wishes of the While the farm land Is soaring in House. to restore the peanut and value. the value of homes in some sugar price support programs to the parts of Queens Is actually depreciat- bill. These provisions add costs and Ining. and the neighborhoods are failing. efficiencies to farm production. which To cut the Federal 312 program -is as causes the consumers I represent to shortsighted as to cut the REA pro- oppose the bill. I gram. _At -the same time. the bill contains All ths rgasrrlelectrifica- target and loan prices for basic farm tion. the New York City loan guaran- commodities that will set those prices at -the lowest levels. as a percent of parity. in half a century. .Low prices for farmers are not exactly news. Farm. Income has declined 3 years In a row. from $32 billion in 1979 to a projected $15 billion In 1982. With Income declining. farmers are forced to borrow Just to pay the Interest on the money they already owe. Recent USDA statistics show farm debt is now eight times higher than farm Income. And despite the credit crunch. this farm bill makes credit harder to get by making the economic emergency loan program discretionary. So the situation Is rising prices for consumers. falling Income for producers. and a new coalition forming between rural and urban members In opposition to farm programs. I am going to vote against the farm bill conference -report tomorrow. I am going to. vote against It because of the sugar and peanut provisions that are bad for my consumers. but also because I learned In South Dakota that the target and loan prices are bad for the farmers. Finally. I .want to thank Tom DAscmx. and all the people from Sioux Valley Electric. particulsarW~ Virg Herriot. for a thoroughly informative 2 days. I think I have learned some things that will make me a better Member of Congress.