Date: 1982-05-04
Speaker: DE LA GARZA (democrat)
Chamber: H

Mr. Speaker. I thank the gentleman from Arkansas and congratulate him for his effort in organizing this session this afternoon. and all of the other Members who will address this very critical issue in -our country. I specifically wish to commend and thank very much the Speaker for his interest. the majority leader for his interest in assisting us and trying to bring the plight of rural America to the attention which It merits at this time. I want to be brief. Mr. Speaker. but I do want to say at the outset that we may disagree on the number of things In this House. but I think there is one point on which all -of us. regardless of party. can agree. many farmers are in trouble today. Mr. Speaker. we. the American people. are the best fed people in the world. We. the American people. get all of what we consume at the table at home. for less of our disposable income than is spent by any other people in the world. perhaps in the history of the world. Perhaps the one exception would be a very small subsistance area. We provide this great service. Mr. Speaker. for two reasons: One. is that our farmers have the capability. the technical capability. and the personal resistance to withstand failure and loss and acts of God and interference from governmentand to doggedly go on and produce. The world is not buying our manufactured goods. It is not buying our calculators or radios or televisions or cars. People abroad are buying primarily what we produce on farms. That is the only area in which we. the great. powerful United States of America. now compete with other nations in the worldonly in what that farmer produces. I know that people out there in urban America have problems of income specifically at this time. but those problems are compounded for the farmer many times when you. the people of the United States. buy in the supermarkets or in the grocery stores something which the newspaper advertises as a bargain for you today. You do that without realizing many times that the bargain which allows you to feed your family for less of your disposable income than almost any other people in the world. is because the farmer sold it for less than it cost him to produce it. So when they talk about subsidies. the biggest provider of subsidies for the American people is the American farmer who produces and delivers to the marketplace. many times below the cost of production. Many of these farmers. as I said. are in trouble today. This does not mean that all farmers are going broke. There have been some welcome trends in some areas. For example. the price of hogs and cattle today is up from the depressed levels of the past. and I am glad to see that some producers are finally reporting profits again. In my own home district. we have many fine. efficient producers of fruits and vegetablesand while they have been hit by high interest rates and rising costs. they have not suffered as much from the continuing price depression which has hit grains and some other products. Even in the depressed segments of agriculture. there are some farmers who bought their land before the explosion of recent years in land and interest costs and production costsand these farmers are not suffering ls much as many others. But for a great many farmers. in many parts of the country. the last 2 years have been disasters. and the best forecasts we can get indicate that this year may be worse. According to USDA estimates. net farm incomefigured without inventory adjustmentwas $27.4 billion in 1979. Preliminary estimates indicate the figure was down to $21.9 billion in 1980 and down again to about $19 billion in 1981. As far as 1982 Is concerned. I cannot tell you anything official. As many Members know. the Agriculture Department has eliminated the preliminary income forecasts which it normally makes at this time of the year. The Department tells us that information available at this point in the year is too sketchy and subject to change to permit a sound projection. So there will be no 1982 forecast from the USDA until September. Unofficially. however. experts at the USDA are predicting that net farm income this year will be down to somewhere between $14 and $18 billion. One respected private economic foreca9ting service. Chase Econometrics. is predicting a net income level of $15.5 billion for this year. The seriousness of the decline in farm income is made more apparent when these estimates are adjusted for inflation. In constant (1967) dollars. realized net farm income fell to $6.3 billion in 1981. compared with $11 billion in 1979 and an average of $10.2 billion in the 3 years prior to 1981. Based on unofficial USDA estimates. 1982 net farm income in constant dollars would irange between $5 and $6 billion. The adjusted figures for 1981 and 1982 represent the lowest level of net farm income in constant dollars since 1932. They are $1 to $2 billion lower than the estimate for farm income in 1977. the last major crisis year for agriculture. The farm income situation in 1977 and 1978 was serious enough to encourge thousands of farmers to descend on Washington. D.C.. in tractorcades. By all accounts. the crisis affecting agriculture in some areas. is even more serious today. As far as USDA Is concerned. all they will say on the record about 1982 is that things look bad. Here is the statement which the USDA has just published in the April issue of its Agricultural Outlook summary: Farmers net cash income will likely remain at a reduced level for the third consecutive year. With gains in cash receipts being drained away by increasing cash expenses in the past few years. farmers have had to adjust to declining net cash incomes. They have taken on more debt and delayed purchases of capital items. This slowdown has also hurt farm machinery dealers and manufacturers. and other input suppliers. I am sorry that we have to look to economists outside the Government for estimates on what is happening in American agriculture. We have all heard charges that while USDA says it cut out farm income forecasts because information at this time of year is too uncertain. the real reason is that USDA does not want to publicize some very discouraging figures. Maybe it is time to get at the facts in this matter. Last week. I joined Mr. SrmoN of Illinois in introducing H.R. 6177. a bill which would require the USDA to return to its traditional practice of publishing farm income estimates on a monthly basis. We intend to hold hearings on this bill in the Committee on Agriculture as soon as practical. The USDA can give us their explanation. in detail. for abandoning farm income forecasts and we can hear from independent experts and others who are qualified to talk about the problems of making and using farm income forecasts. That way. we can lay out all the facts and make an informed decision on whether to direct the USDA to restore the traditional forecasts. There is no disagreement. as I said. that 1982 will be a year of economic stress for many American farmers. If we can agree on that. I think we should be able to agree that we should be doing everything practical to help farmers pull themselves out of the economic ditch. That includes doing something about an export credit revolving fund. which this Congress authorized but which the administration will not yet help us to fund. Action on farm exports is Important to American farmers because prices for many of our major commodities are tied closely to conditions in export markets. More than 1 out of every 4 acres of corn we plant is grown for the overseas market. More than 1 out of every 2 acres of wheat. soybeans. cotton. and rice is produced for export. What that means is that we need a strong overseas market if we expect American farmers to get decent returns on highvolume production. And the export market this year has been lagging for several reasons. One problem is that with American supplies as big as they are. many of our foreign customers are buying on a handtomouth basis. They are letting the United States carry their inventories for them Another problem is the fact that the dollar has strengthened this year in relation to many foreign currencies. As a result. every bushel of wheat. corn. or soybeans becomes more expensive to the foreign buyereven without any price change in dollars. And with the whole world economy sluggish. the effect of what amounts to higher costs for importers has been to take another bite out of our prospective sales. The net result is that USDA is forecasting that the value of farm exports may decline slightly this year. Even with a small decline. our export business is a tremendous asset to agriculture and the national economy. But any decline under todays conditions in agriculture is bad news for farm income. Now I want to touch briefly on another set of problems which are of great importance to agriculture. Todays economic problems are serious. But they are not the only issues that concern Americanagriculture and Its future. We do not see many screaming headlines about the problems of science and regulation. Partly this is because the news media tends to report the things that happenand in the field of science and regulation. the real problem too often Is something that does not happen. If a combination of redtape and excess regulation discourages the development and marketing of some useful new animal health product. it is usually not news. No television crew is going to take pictures of a product that is not being made and used. But the lack of that new product may be more important than a lot of things that do happen. It may be responsible for keeping production costs higher than they need to be. and it may be responsible for keeping food supplies more expensive than they need to be. In recent years this problem has been creeping up on American agriculture. The reasons are not hard to find. The Government. and in some cases the Congress. has been concentrating during recent years on safetyand there Is nothing wrong with that. Nobody wants to run unnecessary risks with the health of the American public. But somehow. in the concentration on safety. we seem to have forgotten that we must also have some balance. We must somehow make it possible for researchers to develop and bring into use the products we need to keep agriculture growing. Let me give you one example. Last year. I am told. 15 new animal health products were approved in Great Britaina country which also puts great stress on protecting health. Do you know how many new animal health products were approved last year in this country for livestock use? The answer is: Just one. What is happening in the animal health field is also a matter of concern in other areas. There is no simple and easy answer to these problems. We must continue to make sure that we do not permit any needless danger to public health. But within that framework. we should be looking for effective ways to bring scientific judgment and modern technology to bear in our regulatory programs. We should keep in mind that Government policy should not only promote safetyit should also promote efforts to bring our people an expanding supply of food at a reasonable cost. Also. Mr. Speaker. we should remember that research in all of the areas of agriculture is one of the most important of all the responsibilities facing our Government. our land grant universities. and the many other public and private research agencies. We know that population here and around the world is going to continue to grow in the years and decades ahead. We know that this will force us to find better ways to produce more food without destroying our natural resource base. These are. In the long run. questions of life and death. The only place these questions can be answered Is in the scientific laboratory and the agricultural experiment station. No matter what else we do in farm policy. we must maintain an effective research program. In conclusion. Mr. Speaker. let me say that no situation hias cried out for our attention since the Great Depression as much as the plight of rural America. We cannot. we must not. fall our people. Mr. Speaker. I very respectfully disagree with those who insist that there is a free market for agricultural products. There is not. The closest thing to a free market existed up to 1929 and it was this which led to bringing down farmersand with them the entire Nationinto depression. Mr. Speaker. this could happen again. and even though the number of farmers is now small in comparison to the total population. it is estimated that at least 30 to 35 million people would be brought down if we have an economic collapse of our farm sector. Can the Nation. can the world. sustain such a loss? I submit to you that we cannot. Those of us who speak here today do so because we sincerely think that our actions can prevent this eventual disaster. I do not know what we can do. We still have to address the issues. but certainly we cannot as a responsible Congress sit here and do nothing except to say that "things will be better. the marketplace will respond." That is a fallacy which was proven wrong in the crash of 1929. We cannot stand by and say that things will be right. A few farmers who have withstood that blow will hang in there. but there are those who need our assistance. Mr. Speaker. it is for that reason that I join with the gentleman from Arkansas .and with others who will be here today. We cannot and we must not fail rural America when it needs us the most. and that Is now. Mr. Speaker. I thank the gentleman for yielding. I