Date: 1985-06-24
Speaker: DE LA GARZA (democrat)
Chamber: H

Mr. Speaker. I thank my colleague for yielding this time to me. and I would like to add my voice in support of H.R. 2211. the Family Farmer Bankruptcy Act of H.R. 2211 is a straightforward bill that gives financially distressed family farmers a better opportunity to devise a repayment plan with their lender that will enable them to work their way out of debt. The financial troubles facing our agricultural economy are not of the farmers making. For a variety of reasons the farmer has seen export markets collapse and farm income decline while his costsincluding interestremain high. The high interest rates of the late 1970s have not subsided in the farm belt. While the rest of America is experiencing a decline in interest rates. the cost of credit to many farmers has actually increased as farm lenders struggle to survive. In addition to declining exports and increasing interest rates. the family farmer has had to face a rapid decline in agricultural land values over the past 5 years. The largest declines have occurred in the Midwest. where land values in States such as Iowa and Nebraska have fallen by as much as 40 percent since 1981. but the decline is not limited to the Midwest. Even specialty crop producers in California are now feeling the credit pinch that declining land values bring to the family farmer. How many American businesses could afford to borrow the operating capital they need if the value of their equity had fallen by 40 percent in only 4 short years? I believe that very few would withstand such a devastating drop in the value of their asset base. President John F. Kennedy once observed that "the farmer is the only man in our economy who buys everything he buys at retail. sells everything he sells at wholesale. and pays the freight both ways." Unfortunately. the economic situation observed by President Kennedy 20 years ago is still true today. As a result. low commodity prices. shrinking export markets. high interest rates. and tumbling land values have combined to force many farmers to the brink of bankruptcy. The troubles currently plaguing the American farmer are not unfamiliar to the Members of the House. This March the House passed emergency farm credit legislationwhich unfortunately was vetoed by the President. The legislation before us today is not nearly as sweeping as the emergency farm credit legislation. H.R. 2211 Is a simple change in the bankruptcy law that will extend a helping hand to the American .family farmer at a time when he needs it most. This bill will allow farm families to remain in their homes while working to repay the mountain of debt that many -of them have accumulated because of circumstances beyond their control. H.R. 2211 will provide farm families up to 10 years to repay their accumulated debt of up to $1 million and make related changes in the Bankruptcy Code designed to allow farm families to work with their creditors to solve their financial problems with compassion and dignity. It will enable these families to remain on the land that they love and in the communities that they have been a part of for generations. I commend Chairman RODINO and the members of the House Committee on the Judiciary for bwinging this legislation before us today. I hope that my fellow Members of the House of Representatives will join me in supporting this legislation that will give thousands of American fatm families one last ray of hope that they may continue to till the soil and provide food for the dinner tables of all America.