[Senate Hearing 109-283]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 109-283
 
 NOMINATION HEARING OF CHARLES F. CONNER TO BE DEPUTY SECRETARY, U.S. 
                       DEPARTMENT OF AGRICULTURE

=======================================================================

                                HEARING

                               before the

                       COMMITTEE ON AGRICULTURE,
                        NUTRITION, AND FORESTRY

                          UNITED STATES SENATE


                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION


                               __________

                             APRIL 6, 2005

                               __________

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           Committee on Agriculture, Nutrition, and Forestry


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           COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY



                   SAXBY CHAMBLISS, Georgia, Chairman

RICHARD G. LUGAR, Indiana            TOM HARKIN, Iowa
THAD COCHRAN, Mississippi            PATRICK J. LEAHY, Vermont
MITCH McCONNELL, Kentucky            KENT CONRAD, North Dakota
PAT ROBERTS, Kansas                  MAX BAUCUS, Montana
JAMES M. TALENT, Missouri            BLANCHE L. LINCOLN, Arkansas
CRAIG THOMAS, Wyoming                DEBBIE A. STABENOW, Michigan
RICK SANTORUM, Pennsylvania          E. BENJAMIN NELSON, Nebraska
NORM COLEMAN, Minnesota              MARK DAYTON, Minnesota
MICHEAL D. CRAPO, Idaho              KEN SALAZAR, Colorado
CHARLES E. GRASSLEY, Iowa

            Martha Scott Poindexter, Majority Staff Director
                David L. Johnson, Majority Chief Counsel
              Steven Meeks, Majority Legislative Director
                      Robert E. Sturm, Chief Clerk
                Mark Halverson, Minority Staff Director

                                  (ii)


















                            C O N T E N T S

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                                                                   Page

Hearing(s):

Nomination Hearing of Charles F. Conner to be Deputy Secretary, 
  U.S. Department of Agriculture.................................    01

                              ----------                              

                        Wednesday, April 6, 2005
                    STATEMENTS PRESENTED BY SENATORS

Chambliss, Hon. Saxby, a U.S. Senator from Georgia, Chairman, 
  Committee on Agriculture, Nutrition, and Forestry..............    01
Harkin, Hon. Tom, a U.S. Senator from Iowa, Ranking Member, 
  Committee on Agriculture, Nutrition, and Forestry..............    04
Leahy, Hon. Patrick, a U.S. Senator from Vermont.................    03
                              ----------                              

                               WITNESSES

Conner, Charles F., Nominee to be Deputy Secretary, U.S. 
  Department of Agriculture......................................    05
Lugar, Hon. Richard G., a U.S. Senator from Indiana..............    03
                              ----------                              

                                APPENDIX

Prepared Statements:
    Letters to Senator Saxby Chambliss and Senator Tom Harkin....    26
    Conner, Charles F............................................    30
Document(s) Submitted for the Record:
    Conner, Charles F. (Biographical Information)................    34
Questions and Answers Submitted for the Record:
    Baucus, Hon. Max.............................................    92
    Crapo, Hon. Mike.............................................    95
    Harkin, Hon. Tom.............................................    96
    Roberts, Hon. Pat............................................   101
    Salazar, Hon. Ken............................................   103
    Talent, Hon. James...........................................   106




















NOMINATION OF CHARLES F. CONNER TO BE DEPUTY SECRETARY, U.S. DEPARTMENT 
                             OF AGRICULTURE

                              ----------                              


                       WEDNESDAY, APRIL 6, 2005,

                                      U.S. Senate,,
        Committee on Agriculture, Nutrition, and Forestry,,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 9:17 a.m., in 
room 328-A, Russell Senate Office Building, Hon. Saxby 
Chambliss, chairman of the committee, presiding.
    Present or submitting a statement: Senators Chambliss, 
Lugar, Talent, Coleman, Harkin, Leahy, Conrad, Baucus, Lincoln, 
Nelson, and Salazar.

STATEMENT OF HON. SAXBY CHAMBLISS, A U.S. SENATOR FROM GEORGIA, 
  CHAIRMAN, COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY

    The Chairman. Good morning. We are here today regarding the 
nomination of Chuck Conner to be Deputy Secretary of 
Agriculture.
    Mr. Conner is no stranger to this committee. From 1980 to 
1985, he served as Senator Lugar's agricultural aide. From 1985 
to 1987, he was a professional staff member with the Senate 
Agriculture Committee. From 1987 to 1997, he served first as 
Minority Staff Director, then as Majority Staff Director of 
this committee.
    I will have to say, just from a personal perspective, 
having served in Congress for 10 years, I have known Chuck for 
basically all of those 10 years, and Senator Lugar, you made an 
excellent choice when you chose Chuck Conner to join your 
staff. He is certainly someone who has extensive knowledge of 
agriculture and of our programs and has been a very good person 
to work with over the years.
    Mr. Conner was President of the Corn Refiners Association 
from 1997 to 2001. Since 2001, he has been the Special 
Assistant to the President for Agricultural Trade and Food 
Assistance.
    Mr. Conner is accompanied today by his wife, Dru, and their 
four children, Katie, Ben, Andrew, and Emily. We are pleased to 
have all of you with us. Also in attendance today are Chuck's 
brother, Mike Conner, and his sister-in-law, Sally Lindsey. 
Welcome to each of you.
    Senator Harkin is not here yet, but we will give him an 
opportunity to make any comment he wishes to when he comes in.
    I want to let you all know what we are going to do this 
morning. Because of the Joint Session later this morning, I 
will ask my colleagues either to submit their opening 
statements for the record or present them during the first 
round of questioning. We have the session at--I believe we need 
to be on the floor at 10:30, so we are going to try to move 
this along, and that is our reason for bumping up the time 
table.
    With that, I would like to turn to Senator Lugar for an 
introduction of Mr. Conner. Senator Lugar.

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

    Senator Lugar. Thank you very much, Mr. Chairman. This is 
an especially high moment for me and I am grateful to have this 
opportunity to introduce to my fellow members Chuck Conner. He 
is a true friend of American agriculture and certainly a loyal 
friend of mine.
    Almost 20 years ago, Chuck Conner was a young member of my 
staff, was with me when former Secretary of Agriculture John 
Block visited our farm and announced the first Conservation 
Reserve program. It is fitting that both Chuck Conner and the 
Conservation Reserve have matured during that generation into 
pillars of American agriculture, in my judgment.
    He began working for me, as you have mentioned, Mr. 
Chairman, in 1980 in my personal office as a legislative 
assistant handling agricultural issues. Chuck was always in 
tune with agricultural issues on a national level, but more 
importantly, he understood the issues farmers were facing and 
that he faced in the fields of Indiana. In fact, he grew up on 
one of those Indiana farms in Benton County, was an active 
participant in the family's 1,100-acre corn and soybean farm, 
and paid for his college education at Purdue University by 
starting his own hog operation that I believe blossomed to 
nearly 20 registered Chester white sows.
    Chuck combined this formative experience and his Bachelor 
of Science work in agricultural economics at Purdue just prior 
to coming to Washington to serve on my staff. Subsequently, 
Chuck has been an integral figure in forming Federal 
agricultural policy. While working with me as a member of the 
staff and later as the staff member and Staff Director of this 
committee, Chuck helped usher forward farm bills through the 
Senate, including the 1996 FAIR Act that ended 60 years of 
Federal reduction controls. Chuck's work in the Senate can be 
seen in moving American agriculture to a more free market 
system, thoughtfully making the USDA more efficient, making 
food safer, reforming the farm credit system, updating 
commodity futures laws, and preserving and improving our 
nation's child nutrition laws.
    Chuck later played important roles in policy development as 
President of the Corn Refiners Association, and most recently 
as President Bush's Special Assistant for Agriculture.
    I have had the distinct pleasure of witnessing Chuck 
succeed in each of these professional pursuits. More 
importantly, my wife Charlene and I have also enjoyed watching 
Chuck marry another Hoosier who also worked in my office. His 
wife, Dru, is with us today. They have done a tremendous job in 
raising their four children, Katie, Ben, Andrew, and Emily.
    Chuck has always possessed sound character, an ability to 
work in a bipartisan manner to improve our nation's food and 
fiber infrastructures. As both a farmer and Senator on this 
committee, I am confident that Chuck will serve our nation 
superbly as Deputy Secretary of Agriculture at the United 
States Department of Agriculture.
    I thank you, Mr. Chairman, for allowing me to make this 
statement. I will ask your leave in a few minutes to go do my 
duty on the floor as we proceed with the other responsibility I 
have in foreign relations. There will be a vote probably about 
10:10, so this may influence the work of the committee 
likewise. Thank you.
    The Chairman. Thank you, Senator. We appreciate your 
continued strong leadership as a member of this committee. I 
just received that same information, that there is a vote on 
your bill at about 10 this morning. I will just say, too, there 
is a possibility we may not finish until after the speech of 
President Yushcenko. If we are not finished, we can come back 
and we will resume the hearing.
    Senator Leahy had a quick comment.

  STATEMENT OF HON. PATRICK LEAHY, A U.S SENATOR FROM VERMONT

    Senator Leahy. I do, Mr. Chairman, and I appreciate it. I 
couldn't help but think, I was talking with Chuck Conner 
earlier and it feels like old times with Dick Lugar and myself 
and Chuck. I have known him for a lot of years. The President 
could not have made a finer choice. He really could not have 
made a better choice for the No. 2 slot at USDA.
    I know during the time he worked for Senator Lugar and 
worked with this committee, part of the time I was chairman, 
part of the time Senator Lugar was chairman, and we all 
benefited by his good judgment. I told him today he has that 
facility, which very much reflects Senator Lugar, that he 
always kept his word, and it made our life a lot easier as a 
result.
    It was in 1990, we did a farm bill in about a week, a 5-
year farm bill that had taken, 5 years before, had taken seven 
or 8 weeks, but because we could work together, we worked out 
probably 95 percent of the Farm bill by consensus and a lot of 
that is because of the great work that Chuck was doing.
    I know there are going to be a lot of challenges ahead. I 
want to commend you, Mr. Chairman, for your effort to protect 
the programs. A lot of them are facing funding cuts. I know you 
have been working with Chairman Gregg on that. Obviously, I 
wish we didn't have any cuts, but we are in far better shape 
because of the work you are doing.
    Chuck Conner and I talked earlier about some of the feeding 
programs. It has been a hallmark, a bipartisan hallmark of this 
committee from the time of Dole-McGovern to Dole-Leahy to 
Lugar-Leahy, feedings programs that have gone through here. It 
has worked very, very well.
    We will have questions on the MILC program here. Chuck 
knows well there have been divergent views on dairy in this 
committee. We have found something we can bring a lot of those 
views together.
    Frankly, Mr. Chairman, your leadership is going to be very 
helpful to us, but you are going to be helped by having such a 
consummate professional at USDA. I compliment the Secretary. I 
compliment the President. I hope that doesn't hurt you, Chuck--
--
    [Laughter.]
    Senator Leahy [continuing]. I compliment you all for this, 
and I thank you, Mr. Chairman. I will put my full statement in 
the record.
    The Chairman. Thank you.
    The Chairman. Before I turn to Mr. Conner, let me say that 
we received a letter this morning addressed to Senator Harkin 
and myself from over 60 commodity groups that are in support of 
the nomination of Chuck Conner for this position.
    [The letter can found in the appendix on page 26.]
    Senator Leahy. Also, Mr. Chairman, if you do reach a point 
where you are going to be voting, you have my proxy to expedite 
this in any way you can.
    The Chairman. Thank you.
    Senator Harkin, we are just getting ready to turn it over 
to Mr. Conner, but if you prefer to go ahead and make a 
statement, we will let you go ahead, whatever is your 
preference.
    Senator Harkin. Thank you, Mr. Chairman. I apologize for 
being late to the committee.
    The Chairman. Senator Harkin.

STATEMENT OF HON. TOM HARKIN, A U.S. SENATOR FROM IOWA, RANKING 
   MEMEBER, COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY

    Senator Harkin. I will put my whole statement in the 
record. I won't burden you with reading the whole thing, but 
again, just to welcome Chuck Conner here, to congratulate him 
on his nomination to serve as Deputy Secretary.
    Obviously, I first met Chuck when I came here in 1985 when 
he was with Senator Lugar and we have had a great relationship 
ever since. I can say without any hesitation or any fear of 
contradiction that any time that we worked on farm legislation 
in the 1980's--we had some pretty tough bills in those days, on 
the credit bill that we passed, Chuck was working on that--on 
through the 1990's, every time we had any dealings, Chuck was 
always there, open, above board, willing to work with us, just 
a great person to work with.
    Then I followed him through his work in the administration 
on the last Farm bill when I was privileged to be chairman for 
a brief shining moment and Chuck was representing the White 
House and we had a great relationship. We got the Farm bill 
through in a great bipartisan manner and had a great signing in 
the White House.
    I just say that in the 20 years I have known Mr. Conner, 
Chuck Conner, I can say that he is an outstanding individual, 
someone I admire greatly, someone who knows agriculture, cares 
about rural America deeply, and I just congratulate him on this 
new position, look forward to working with him, and hope we can 
expedite this, Mr. Chairman, and get him confirmed as soon as 
possible.
    Thank you, Chuck, for so many years of service to this 
committee, to agriculture, and to our country.
    The Chairman. Thank you, Senator.
    Chuck, before we ask you to testify, would you please stand 
and let me swear you in.
    Do you swear or affirm that the testimony you are about to 
provide is the truth, the whole truth, and nothing but the 
truth, so help you, God?
    Mr. Conner. I do.
    The Chairman. There is one question we need to ask you for 
the record, before you make any comment. Do you agree that you 
will appear before any duly constituted committee of Congress, 
if asked to appear?
    Mr. Conner. I will, Mr. Chairman.
    The Chairman. Thank you very much, and we look forward to 
your comments.

STATEMENT OF CHARLES F. CONNER, NOMINEE TO BE DEPUTY SECRETARY, 
                 U.S. DEPARTMENT OF AGRICULTURE

    Mr. Conner. Thank you. Mr. Chairman, Senator Harkin, 
members of the committee, I am grateful to the Committee on 
Agriculture. Thank you, Mr. Chairman, also for promptly 
scheduling this hearing to consider my nomination. I am humbled 
and honored to have been nominated to serve President Bush in 
this way.
    I want to begin my opening statement by thanking the man 
who is responsible for many of my professional successes. 
Senator Lugar, as most of you know, has had a profound impact 
on my life. You will note from my information that I was only 
22 years old when Senator Lugar took a chance and offered a 
farm boy from Indiana the opportunity to come to Washington to 
work on food and agricultural policy. On the day that I started 
working for Senator Lugar, I left behind tearful relatives in 
Indiana and flew on an airplane for the first time and traveled 
to Washington, DC. My life would never be the same, and the 
next 17 years were some of my very best. Senator Lugar, you 
have modeled for me a life of integrity and decency in public 
service, and for that, I will always be grateful.
    Senator Lugar, as he mentioned in his opening statement, 
has had a large impact on my personal life, as well. He also 
gave an opportunity to a young woman from Fort Wayne, Indiana, 
to work in his office. My wife, Dru, and I met and were married 
while working for him and I will always be grateful to him for 
providing me that opportunity to meet my wife, and, of course, 
now to have our four terrific children who are here with me 
today.
    Mr. Chairman, if confirmed by the Senate and by this 
committee, I want you to know that I will be guided by my 
experiences that have helped to shape my professional career 
over the last 24 years.
    I have seen this committee through many leadership changes. 
Herman Talmage, a Democrat from Georgia, was the chairman of 
this committee when I started working here in 1980. Senators 
Lugar, Cochran, and Leahy, I believe, are the only members 
still serving from those days. The issues have changed 
somewhat, but one thing that has not changed is the fact that 
this committee continues to accomplish great things through 
bipartisanship efforts.
    During my tenure as Staff Director of this committee, I 
hope, Mr. Chairman, that I demonstrated my desire and ability 
to work with both sides of the aisle. We may disagree, but we 
can debate those disagreements knowing that each participant 
has a common goal, the goal of promoting the welfare and 
interest of the farmers and ranchers of this great land and 
those who produce the products that sustain us. That is a value 
shared by Secretary Johanns and President Bush. If confirmed by 
this committee and the full Senate, I pledge to you that I will 
continue to make every effort to work with both sides of the 
aisle and to reach out to all regions of the country.
    Second, my firsthand experiences have developed in me an 
appreciation of the honor and importance of production 
agriculture. I grew upon a family farm. I watched my father 
toil every day of his life just to provide a modest living for 
his family. If confirmed, I will be an advocate for the farmers 
and ranchers. The farmers and ranchers who provide an abundance 
of low-cost food and fiber for this country and others around 
the world should be given the opportunity to earn a decent 
living for their family. This applies to the farmers and 
ranchers of Georgia, Mr. Chairman, North Dakota, Vermont, 
California, wherever the case may be, and including, of course, 
the farmers and ranchers of Indiana.
    Third, I believe we must do everything we can in order to 
keep a competitive advantage around the globe for U.S. farmers 
and ranchers. This principle means that, just like President 
Bush and Secretary Johanns, I am firmly behind our trade 
negotiations and their efforts to reduce tariffs and duties on 
our agricultural exports. It is difficult to remain competitive 
if big duties must be paid in order to export. I believe this 
can be done in an environmentally sensitive manner by using 
incentive-based programs, many of which are targeted at working 
lands. To remain competitive, we also must utilize our strong 
agricultural research system, which I am a strong advocate of, 
and must get this information into the hands of our producers.
    Mr. Chairman, my experiences on this committee have not 
been limited to farm programs. The late 1980's and early 1990's 
were difficult years for American agriculture. The senior 
Senator from Vermont, Senator Leahy, was the chairman of the 
committee during many of those years and we faced difficult 
challenges. We tackled issues like rescuing the Farm Credit 
System, promoting conservation programs, providing a safety net 
for the poor, reorganizing the U.S. Department of Agriculture, 
managing our National Forest System, and strengthened our rural 
development programs, and many others. All were priorities of 
the chairman and ranking member, and it has gone a long way 
toward preparing me for the awesome responsibility that awaits 
me if I am confirmed by this committee.
    I close, Mr. Chairman, by simply thanking the members of 
this committee, past and present, for your help in preparing me 
for this job. If confirmed by this committee and the U.S. 
Senate, I can assure you that I will work hard to earn your 
support and respect and to live up to the standards exemplified 
by the members of this committee.
    Thank you, Mr. Chairman, and I would be happy to answer any 
of your questions.
    The Chairman. Chuck, thank you very much for that fine 
opening statement.
    [The prepared statement of Mr. Conner can be found in the 
appendix on page XX.]
    The Chairman. Traditionally, the Deputy Secretary has acted 
as the day-to-day Chief Operating Officer of the Department. 
What management skills area would you bring to that aspect of 
the Deputy's job?
    Mr. Conner. Mr. Chairman, one of the responsibilities that 
came upon us in the late 1980's and early 1990's was 
legislation that was proposed by this committee to actually do 
what was regarded as probably the most comprehensive 
reorganization of the management structure of the Department of 
Agriculture. This, as you can imagine, was a very controversial 
piece of legislation. Any time you are talking about changes, 
changes in offices, perhaps even relocating or collocating 
offices, as was the case, these are very controversial matters.
    Over the course of a long period of time, we successfully 
produced legislation that both Senator Lugar and Senator Leahy 
championed, had broad bipartisan support, and really is the 
framework of the existing Department of Agriculture as we know 
it today. Certainly, that was a big training ground, if you 
will, for my understanding of the structure of the Department 
of Agriculture, how the management system works within that 
agency.
    Just generally over the years, many, many experiences have 
prepared me for this job. Most of all, Mr. Chairman, what 
prepares me for this job is the heart that I have for the 
American farmer and rancher, and that is basically what the 
agency has, as well, and whether it is career people, political 
people, they serve at USDA because they want to promote the 
welfare and interest of the farmers and ranchers.
    We are going to get along well. There are many, many fine 
professional people over at USDA whom I have worked with for 
many years. I look forward to working with them, as well, in 
this capacity.
    The Chairman. One frustrating area for this member has been 
the lack of communication with the administration relative to 
agricultural issues, and no greater point on this can be made 
than the recent issue relative to the budget. I don't know of 
any member of this committee who had any dialog of any sort 
with the administration prior to that budget coming out, and 
that is very frustrating to us because it has to be a team 
effort, particularly on something as sensitive as the budget.
    What level of communication do you think is necessary, and 
if we are going to improve that dialog, how do you intend to 
improve the relationship from a communications standpoint 
between the Hill and the administration?
    Mr. Conner. This is an area, Mr. Chairman, that I know Mike 
Johanns and I want to focus upon a great deal, and the current 
Secretary has already done a great deal to promote that 
increase in communication. The Secretary is quick to pick up 
the phone to call. I certainly know that he is quick to respond 
to your requests and is eager to do so, and certainly, Mr. 
Chairman, I am going to be that way, as well.
    I want to work with this committee, obviously. If it is not 
clear from my opening statement, I regard this committee as my 
home in many ways, professionally speaking, and it would give 
me no greater pleasure than to have a very close working 
relationship with this committee, with the House Agriculture 
Committee, where I have many colleagues whom I have worked with 
for many years. I just can't imagine attempting to run the 
Department without that close working relationship.
    The Chairman. You alluded to this in your opening 
statement, but let me just ask you again. We live in a country 
that is very large and very diverse and we are blessed with a 
variety of soil and climatic conditions that allows us to 
produce a wide range of food and fiber products. Different 
parts of the country face different challenges and have 
different histories and needs. New England dairy farmers face 
issues that are different from Midwestern corn and soybean 
farmers or Western cattlemen or Southern cotton producers.
    Do you agree that there are regional differences in 
American agriculture and that the government programs should 
not attempt to penalize any region of the country?
    Mr. Conner. I agree with that statement, Mr. Chairman. I 
will openly acknowledge to you that perhaps my knowledge of the 
agricultural commodities in this country outside of what I grew 
up with, which were corn, soybeans, wheat, cattle, hogs, those 
kinds of issues, my knowledge of those perhaps came the hard 
way, sitting around this committee. It probably began in 1985 
when I actually became a professional staff member on this 
committee and Senator Jesse Helms was chairman of this 
committee at that particular time and I had to learn in a hurry 
about tobacco----
    [Laughter.]
    Mr. Conner [continuing]. Peanuts and issues like that. I 
believe I have done so. Obviously, when Senator Leahy, and the 
relationship we had with him during all of those years, Vermont 
agriculture was very, very unique, as well, in that situation. 
I may have a few lumps and bruises over the years, but I 
believe my 24 years has given me a hearty understanding of just 
how broad and diverse American agriculture really is.
    The Chairman. From personal experience, having a keen 
interest in tobacco and peanuts myself----
    [Laughter.]
    The Chairman [continuing]. You learned well, Mr. Conner.
    Mr. Conner. Thank you, Mr. Chairman.
    The Chairman. You have always been very knowledgeable and 
very helpful to this member as a member of the House as well as 
over here.
    With that, I will turn to Senator Harkin.
    Senator Harkin. Thank you very much, Mr. Chairman.
    Again, Chuck, congratulations on this appointment. I look 
forward to working with you. I just have a couple of things I 
want to cover with you.
    Back in 2001 and 2002, when you were representing the White 
House, you were engaged in the Farm bill negotiations quite 
intimately. One that I know that you were engaged in was the 
energy title because we came up with a new energy title for the 
first time. We discussed this at length and it received pretty 
broad bipartisan support, to put an energy title in the Farm 
bill.
    In that title, as you will recall, there is a provision, 
Section 9002, that requires all Federal agencies and 
departments to purchase bio-based products identified by USDA 
as long as they are reasonably equivalent in price, 
performance, and availability. It is a very simple title, 9002, 
but this is a very vital but often unheralded provision that 
will greatly benefit American agriculture, help drive rural 
economic development, wean our country off foreign sources of 
oil, and provide tangible environmental benefits.
    Now, that is in the bill. That doesn't just say the 
Department of Agriculture. It says all Federal departments and 
agencies, from the Department of Defense to Department of 
Interior to everything else shall--it doesn't say may--shall 
give a preference to bio-based products in their purchasing as 
long as they are equivalent in price, performance, and 
availability.
    Well, not much has happened. Last year, I asked GAO for a 
study on this to see what had happened. About a year ago, it 
came out with a pretty scathing, I thought, indictment of the 
USDA for not doing anything on this. Still to this date, we 
still don't have any action from USDA. Not one product has been 
designated for purchase after all this time, and yet the 
language is very clear. It says, ``shall give a preference.'' 
This wasn't something slipped in. This was discussed. People 
thought this was a great way to start getting the Federal 
Government to be a purchaser of these products.
    Now, about a year ago about this time, President Bush was 
in Iowa and I had the privilege of riding in the car with him 
and I talked about this with him and he became quite intrigued. 
I didn't expect him, obviously, to know about it. He doesn't 
know about all these little things in the bill. He called a 
staff person over, whose name I don't know, and said, ``Talk to 
Harkin here about this.'' He talked about it and he took some 
notes, but not much has happened.
    It has been very frustrating for some of us who worked hard 
on the energy title to see that provision there, to see the 
great purchasing power of the Federal Government. I remember I 
told President Bush, he said, ``Well,'' he said, ``we are for 
ethanol.'' I said, ``It has nothing to do with ethanol.'' He 
said, ``What are you talking about?''
    He was drinking water out of one of these little plastic 
cups. I said, ``Mr. Chairman, how many of those plastic cups do 
you think the Department of Defense buys every year, just the 
Department of Defense?'' He said, ``Obviously a lot.'' I said, 
``Well, that is what we are talking about. There is a plant 
right north of Omaha, Nebraska, right now, Dow Cargill, makes 
these cups out of biodegradable starch. McDonald's is buying 
them. If McDonald's can buy them, certainly the Department of 
Defense could buy them.'' Well, that got his interest. That is 
when he called the staff guy over and had him talk to me.
    I just want your thoughts as Deputy Secretary, since you 
will be operating the day-to-day operations, to make this 
program a high priority. Specifically, will you work to get the 
first rules designating items for purchase published in the 
Federal Register and effective as soon as possible?
    Mr. Conner. I will, Mr. Chairman, or Senator Harkin. I 
acknowledge to you this is a mandate in the Farm bill, and I 
will also acknowledge to you that it has probably taken us too 
long to get this in place. I can't recall the precise 
timeframe, Senator Harkin, but we are moving and getting closer 
on this----
    Senator Harkin. Good.
    Mr. Conner [continuing]. We can expect some action on this 
relatively soon.
    Senator Harkin. Great.
    Mr. Conner. I can assure you, though, that if confirmed and 
I get over there, that we will get this done because it is a 
mandate of the Farm bill and it should be done.
    Senator Harkin. I appreciate that very much. You can see 
why I am a fan of Chuck Conner's. He is straightforward. He 
just says it right the way it is.
    [Laughter.]
    The Chairman. He said what you wanted.
    Senator Harkin. He is just straightforward. He doesn't beat 
around the bush.
    The second thing, with your indulgence, and you knew I was 
going to ask about this, the Conservation Security Program.
    Mr. Conner. I did know that.
    Senator Harkin. You knew I was going to get to that, right?
    [Laughter.]
    Senator Harkin. Participation in the first CSP sign-up was 
much lower than NRC has expected. This year, with 220 
watersheds, there will be much less money per watershed from 
the contracts, and the President has proposed even less money 
for new contracts next year. Again, I am concerned that the 
Conservation Security Program as enacted in the 2002 Farm bill 
is being eroded by restrictive rules and limited funds. Again, 
we designed a program. It was supported across the board. We 
walked into this with eyes open and we knew what we were doing. 
Compromises were made. Agreements were made in the Farm bill. 
The President, when he signed the Farm bill, Chuck, as you 
remember, touted loudly the conservation provisions in that 
Farm bill when he signed it. This program was intended to be 
attractive to producers that would generate significant and 
lasting conservation benefits from widespread participation.
    I would just, again, like your commitment that USDA will 
help achieve the original program objectives of the 
Conservation Security Program.
    Mr. Conner. Senator Harkin, you are correct. I did 
anticipate this question a little bit, and you and I have had a 
few conversations about this since the Farm bill. I recall, 
Senator Hark, I believe it was actually the very first meeting 
that I had when I came to the White House was with you early in 
that Farm bill stage and you, for the first time, shared with 
me some of the thoughts that you were looking at with regard to 
the Conservation Security Program.
    As I told you then and I continue to feel, Senator Harkin, 
I am intrigued by this concept. I believe we--this is something 
we need to give full attention to, because I believe the notion 
of providing some financial help to producers, but at the same 
time, too, making that help based upon the conservation 
activities that they are putting in place on that farm, is a 
long-term sustainable, if you will, farm program that I have a 
lot of personal interest in.
    Now, having said that, I know that the first sign-up did 
not go as well as the Senator would expect. I guess I was 
pleased that we were able to go forward with the sign-up, 
because as I have told you before, it probably took us too long 
to get to the stage of that first sign-up because it does seem 
like we passed the Farm bill quite some time ago, and I 
recognize that as I told the Senator when we met several months 
ago.
    Some of that reason for delay, in this case, I won't put 
all of that upon the backs of the people at USDA because there 
have been a lot of legislative changes to the Farm bill since 
its enactment dealing with this particular program, and I know 
the Senator would have preferred those changes not happen, but 
nevertheless, there are--those are significant changes that 
were more than just dollar changes. They did, in order to 
achieve the amount of money that Congress had allocated, they 
required a different type of program, perhaps, than had we not 
had those kind of budget limits.
    Now, we are working very, very aggressively on this, 
Senator Harkin, and I know Mike Johanns has jump-started this 
again after his process. We do have another rule out for 
comment. I can't really go into the details, obviously, of that 
comment, but I will just say we are improving our outreach as 
reflected in this rule and getting input from the 
organizations, the farm organizations and the conservation 
community to make this a better program and perhaps do better 
than we did in that first sign-up for you.
    Senator Harkin. I appreciate that, Chuck----
    Mr. Conner. It is, again, our full intent to get this thing 
up and running well.
    Senator Harkin. I appreciate that very much.
    Again, Mr. Chairman, it was not right that the Congress pay 
for disaster assistance by invading the Farm bill. Disasters 
are emergencies. I have said that many times on the floor and I 
continue to say that. We shouldn't penalize Florida because a 
hurricane hit, or Georgia. Sometimes hurricanes hit Georgia, 
too, I guess. We shouldn't penalize Kansas because a tornado 
has hit or something like that. These are natural disasters and 
emergencies.
    We have never before ever invaded the Farm bill to pay for 
a disaster until, what, 2 years ago? Until 2 years ago, the 
first time. It was a mistake then. It was a mistake last year 
to do it again. Those of us on Agriculture have really got to 
pull together and just not allow this to happen again. It is 
wrong and it should have never been allowed to happen, and that 
is what you are referring to Mr. Conner, in terms of the 
changes legislatively that caused this program to be disrupted.
    Hopefully, it will not be happening in the future and we 
can restore the program again to what it was in the Farm bill. 
Both the former chairman, Senator Cochran, and others have 
stated on the floor, it is in the record, that this program 
should be reinstated to operate as was intended in the Farm 
bill for the duration at least of this farm bill. Now, if the 
committee wants to change it when the next Farm bill comes up, 
well, then that is fine, but it shouldn't be changed in between 
that.
    Thanks very much, Mr. Conner. Thanks for your indulgence, 
Mr. Chairman.
    Mr. Conner. Thank you, Senator Harkin.
    The Chairman. Senator Conrad.
    Senator Conrad. Thank you, Mr. Chairman. It is good to see 
you back here in this room, Chuck.
    Mr. Conner. Likewise, Senator Conrad.
    Senator Conrad. I first of all want to say I am delighted 
at this appointment. Chuck Conner is a pro. Chuck Conner's word 
is good. We dealt with a lot of issues in this committee. We 
didn't always agree, but it was never disagreeable. I know 
Chuck will bring that same attitude to USDA. I would say the 
only thing that would have been better, if they had made you 
the Secretary.
    Mr. Conner. No, thank you. No, thank you.
    [Laughter.]
    Senator Conrad. I hope that word goes out.
    Now, I want to just visit with you, and I see somebody else 
in this audience that would have made an outstanding Secretary, 
too, Congressman Combest. Senator Harkin and I and Congressman 
Combest and Congressman Stenholm spent a lot of time 
negotiating the last Farm bill. They were outstanding 
individuals with terrific staff assistants, as you always 
provided, Chuck.
    Let me just go to the larger question here. According to 
OECD, the international scorekeeper, Europe is providing $277 
an acre of support per year to their producers--$277 an acre of 
support in Europe. The comparable figure here is $48. They are 
outgunning us more than five-to-one.
    On export subsidy, Europe accounts for 87 percent of all 
the world's agricultural export subsidy. We account for 1 
percent. They are outgunning us there 87-to-one.
    We are now entering negotiations to attempt to level the 
playing field, and as we enter the negotiations, the 
administration sends a budget up here that says, cut 
agriculture, that is 1 percent of the budget, the budget that 
passed the U.S. Senate, cut agriculture 16 percent. In my 
State, that means the average farmer is going to lose about 
$5,000 of income. On top of that, the administration says, cut 
from crop insurance another $538 million, putting that at risk.
    I just want to say, I don't see the rationale for these 
cuts. I don't see the rationale for cutting the farm program in 
the middle of it. I certainly don't see it being done as we 
enter into trade discussions to try to level the playing field 
for our producers. If we look at the trend lines, they are 
ominous, because we have moved from a dramatic trade balance, 
trade surplus in agriculture, and now they are telling us this 
year we may actually have net imports of food and food stuffs 
into the United States.
    Could you tell us how it makes any sense to you that in the 
context of Europe providing much more support to their 
producers than we provide to ours, why we cut support from our 
producers?
    Mr. Conner. Well, Senator Conrad, you might be surprised 
that I anticipated this question, as well, and I appreciate the 
context in which you are raising it. You have always been a 
gentleman in these debates and I admire that in you.
    Let me just say, I don't believe you have ever heard me 
apologize for the $19.1 billion, I believe, dollar level, 
aggregate level of support that the U.S. has authorized under 
our trade laws versus, as you have noted, the sizably higher 
amount that our European counterparts are allowed to have. If I 
am not mistaken, I believe their agriculture and our 
agriculture are comparable on a total basis, yet their 
aggregate level of support is some three times, almost four 
times, perhaps, higher than our level. You certainly will never 
hear me apologize for that.
    Now, with regard to the budget situation, let me just say, 
Senator Conrad, first of all, that we feel like we have turned 
the corner on the agricultural economy in the last couple of 
years. That is in no way a reflection, a statement upon 
absolutely every region of the country because we have a big 
and diverse agricultural system and there are always pockets. 
In general, I don't think you can dispute the record net farm 
income that we have seen in the last 2 years, the record low 
level of debt-asset ratios that we have seen, record amount of 
production, record amount of exports this past year----
    Senator Conrad. It sounds like a pretty good endorsement of 
the last Farm bill.
    [Laughter.]
    Mr. Conner. Well----
    Senator Conrad. Would you want to endorse the last Farm 
bill?
    Mr. Conner. Senator Conrad, as you know, I was a strong 
advocate of the last Farm bill, as was the President. 
Continuing on that, though, obviously----
    Senator Conrad. If we could have only had the Secretary on 
board.
    Mr. Conner. Our challenge is obviously to sustain that 
recovery in American agriculture so that it is not a hiatus but 
something that is continuing over time.
    I believe firmly, and I believe the President and the 
administration believe firmly, that one of the key elements of 
sustaining that recovery in agriculture as well as the 
remainder of the economy in terms of job growth is getting our 
arms around this Federal budget deficit, and----
    Senator Conrad. Well, I understand you have to be up here 
and be a good soldier. I just wanted to make the point. Look, 
it makes absolutely no sense to be cutting agriculture when 
Europe is providing much more support than we are, and when we 
are right at the dawn of negotiations to try to level the 
playing field.
    One other question, if I could, on a parochial basis, in 
Devil's Lake, you are familiar with--you have heard me talk 
about this before--we have this lake that has risen 26 feet. 
The lake is now three times the size of the District of 
Columbia and it is flooding more and more land. When you were 
still here, Chuck, you saw me put up a number of charts then 
about how this lake had risen dramatically.
    We have now got an additional 100,000 acres of crop and 
grazing land that have been flooded by the overflow of this 
lake and it continues to rise, threatening another 200,000 
acres. Many of these producers are suffering very, very 
significant losses. Will you be willing to work with these 
producers to explore existing USDA programs that they might 
utilize to reduce these losses or offset them?
    Mr. Conner. I will, Senator Conrad. You know me, and one of 
my trademarks is I am accessible to not only farm 
organizations, but individual farmers who call. My direct line 
is generally readily available and it rings a lot. I am 
accessible to these producers. Obviously, we will talk to any 
group of them that you send my direction, but let us continue 
to take a look at this and see what we can do for them.
    Senator Conrad. I look forward to working with you, Chuck.
    Mr. Conner. I appreciate that.
    Senator Conrad. We really are delighted at your 
appointment.
    Mr. Conner. Thank you, Senator.
    The Chairman. Senator Nelson.
    Senator Nelson. Thank you, Mr. Chairman.
    Let me add my congratulations and appreciation, also, for 
your nomination, Chuck. In our brief time together, we have had 
more than one opportunity to work together, and that has always 
been a very positive experience for me.
    Senator Conrad, if you have that excess water and could 
channel it to Western Nebraska where the drought continues, we 
will be glad to take our share.
    [Laughter.]
    Senator Nelson. I am concerned about the future of trade as 
it relates to agriculture. I am more concerned about it from 
the standpoint that at the end of the day, with many of the 
trade agreements, you would have to say that they are stronger 
on imports than perhaps they have been on exports, and I don't 
know if we are now a net importer of food, but I have heard 
such suggestions. Do you know, are we now importing more food 
than we are actually exporting in terms of agricultural 
products?
    Mr. Conner. I don't have the precise numbers in front of 
me, Senator Nelson. I believe there was a quarter in which we 
were. I am not aware that for a given marketing year for 
agricultural products that we are importing more for that given 
year than what we are exporting, again, because we have seen 
record exports this past year.
    Senator Nelson. As it relates to importation of 
agricultural products, we have to be very concerned that we not 
become a net importer on any extended period of time. If we 
like importing 60 to 70 percent of our fuel, we will love 
importing 60 to 70 percent of our food, which brings me to the 
question about trade agreements.
    I know you are not going to the USTR, but my sugar farmers 
in Western Nebraska and the panhandle are very concerned, and I 
have spoken to other sugar interests around the country about 
the CAFTA agreement because of the importation of more sugar, 
and I wanted to bounce an idea off you for consideration in the 
future. If we can divide--you mentioned food and fiber, but 
also an agricultural program, a Farm bill which I hope we will 
talk about in the future is the Food Security Act, could also 
have another ``F'', and that is ``fuel'' because of what we are 
doing today in growing our own fuel.
    I wonder if there is a thought about how we might import 
virtually unlimited amounts of sugar if they go to fuel as 
opposed to food so that we can continue to grow our own food. 
Almost every country that produces its own rice is very 
reluctant to import much rice because they never want to be 
dependent on anyone else. It seems to me that sugar may fall 
into that category, but on a very different basis. Recognizing 
that sugar can also be fuel, I wonder if you have any thoughts 
about what that might entail if we were to consider CAFTA and 
other future trade agreements that might involve sugar or other 
commodities in requiring those to go to the production of our 
own fuel.
    Mr. Conner. Senator, I appreciate the comment and the 
question. Your idea about--I believe sugar-to-ethanol would be 
a simple way to sum that up--is an intriguing one. Certainly 
from my past work at the Corn Refiners Association, where we 
were heavily involved in the ethanol question, sugar is a 
carbohydrate. It is a starch. Obviously, those starches can be 
readily converted into fuels with the technology that we have 
today, much as we do with corn and other biomasses. The 
technology is there.
    I am not certain, Senator, and perhaps some of your folks 
at the University of Nebraska and others could help us to know 
just what the economics would be and just how much it would 
involve to make that conversion relative to using other 
feedstuffs, but it is an intriguing idea that we would be happy 
to talk with you further about that.
    Senator Nelson. I appreciate that, and I can say from my 
experience of having been to Brazil on a few occasions and 
checking out their ethanol industry, which is based largely, if 
not entirely, on sugar, where they have referred to it as 
``drink the best and burn the rest''----
    [Laughter.]
    Senator Nelson [continuing]. That it does make some sense 
to consider how we might channel that sort of importation so 
that it doesn't disrupt food production in the United States. A 
good deal of our effort for protection of our own production is 
referred to as subsidy. There is no question about it. We also 
deal with imports that are under-priced coming into the United 
States because of larger subsidies in other countries.
    Let me add my comments to Senator Conrad's about the cuts 
to agriculture. I don't think that they are well thought 
through at the present time and I hope that in your new 
position, you will spend a great deal of time working with us 
to see how we can even out some of this potential disruption to 
our agriculture production.
    Mr. Conner. You have that commitment, Senator.
    Senator Nelson. Thank you, and good luck.
    Mr. Conner. Thank you.
    Senator Nelson. Thank you, Mr. Chairman.
    The Chairman. Senator Talent.
    Senator Talent. Thank you, Mr. Chairman, and I will 
restrict myself to one area because I know we have a vote on.
    Mr. Conner, thanks for being here. Congratulations.
    Mr. Conner. Thank you.
    Senator Talent. I agree you are going to do a great job.
    Let me just bring up the issue of locks and dams with you. 
We are trying to compete internationally. We are demanding that 
our ag community accept--a lot of people are pressuring them to 
accept less and less in terms of domestic support, 
notwithstanding what the foreigners are getting, and then we 
are not keeping the promises that we made regarding, among 
other things, the transportation system. We have the 
Mississippi River system. Two-thirds of our grain goes down 
that system. We have locks and dams 600 feet when they should 
be 1,200 feet wide, built 70 years ago for paddle boats.
    I would like you to tell me that you are going to assist 
the Secretary in being an advocate within the administration 
for rebuilding this system, for making these locks and dams 
wider, fixing this infrastructure so that we can get our 
product to market. The only people benefiting from this current 
system are the Brazilians, and we really need the Department of 
Agriculture to make that clear within the administration. I 
just hope you will do it. That is my only question and comment.
    Mr. Conner. Well, I will, Senator. Let me assure you, 
growing up in the Midwest, I fully understand the impact that 
the Mississippi River has on commerce coming out of that region 
of the country. It is not important, Senator, it is absolutely 
essential and I recognize that. What has been going on in terms 
of the last couple of decades with the efforts to stop one 
dollar's worth of rehab, renovation from going on in that 
region is very, very unhealthy for American agriculture. We 
flat out have to be able to get our bulk agricultural 
commodities out of that portion of the Midwest and down to New 
Orleans to a point of export or we are absolutely dead in the 
water.
    I will be an advocate of that, I can assure you, and look 
forward to working with you on that.
    Senator Talent. Thank you. We need to stitch together the 
old brick-and-mortar coalition in both parties. We have some 
people who are opposed to this from an environmental 
standpoint, which is ridiculous. These barges--one of these 
barges replaces 800 to 900 trucks. It is the best thing we 
could do for the environment, to make this river system work 
better. It is like a one-lane highway now with no shoulders and 
it is carrying so much of the nation's commerce.
    I know you believe that. I wanted to give you a chance to 
say that on the record. I really hope you will go in there and 
fight the short-sighted people at the Office of Management and 
Budget on this issue. I thank you, Mr. Chairman.
    The Chairman. Thank you. We do have a vote open, but I have 
told the floor that we need to finish this hearing, so we will 
continue. We are going to go to the Capitol at 10:30, so I 
think we are OK.
    Senator Lincoln.
    Senator Lincoln. Thank you, Mr. Chairman, and certainly 
thank you for your leadership in this committee. We are 
grateful to you for all that you do. Certainly to Mr. Conner, 
we do welcome you back home to the Agriculture Committee.
    Mr. Conner. Thank you.
    Senator Lincoln. You have done a tremendous amount here and 
we are all very, very proud and congratulate you on your 
nomination----
    Mr. Conner. Thank you, Senator.
    Senator Lincoln [continuing]. Know that you will be a hard 
worker.
    I also share your respect for Senator Lugar. He is a 
devoted member of this body, and having helped to start the 
Senate Hunger Caucus last year, I have found no other member as 
dedicated and as compassionate and passionate about those 
issues, so I share your respect for Senator Lugar.
    Your background and your willingness to serve are certainly 
an indication of your commitment and your dedication to 
agriculture and I thank you for that. I, too, grew up on a 
farm. My dad was a farmer. I watched as my father agonized over 
the drought, the floods, the markets, all of the conditions and 
all of the circumstances which he had absolutely no control 
over.
    I also grew up with a man who was very proud of his 
country, very patriotic. He was the only man I ever met that 
loved to pay his taxes.
    [Laughter.]
    Senator Lincoln. He loved to pay his taxes because he loved 
his country and he said, ``You know, for what I pay in taxes, I 
get a tremendous amount, the honor and the privilege to be a 
part of this country, to serve in its armed forces, to be able 
to be something that I have always dreamed of being, and that 
is a farmer, to get my hands dirty every day and to be able to 
do the best job I can in producing the safest, most abundant 
and affordable food supply.'' I share your pride in that, 
coming from a farm family.
    I know he believed in his government, and I know he 
believed that when his government made a contract with him, 
that he felt strongly that his government would not back out on 
him. I guess that is one of the biggest disappointments that I 
have had in all of the efforts you and many, many others put 
into the 2002 Farm bill. I see Chairman Combest in the audience 
there. He provided tremendous leadership there, as well as many 
of the other members of this committee.
    I guess, knowing how proud your family is today sitting 
there with you, I remember this morning dropping my children 
off at school and each of them had a little Ziplock bag of 
change. Their school and student body, each of the students 
were collecting money to find a cure for cancer, and they were 
distraught in that they felt like they should have more. I 
said, you have cleaned out your piggy banks. You have cleaned 
out my pocketbook. We have gathered up all the change and you 
have given, and that is important. It is important to know that 
each of us gives what we can.
    For Southern agriculture and the rural communities of the 
South, we do desperately want to be good Americans and we want 
to give and we want to participate in the historic debt that we 
have in this nation, in bringing it in line. We want to 
participate in providing the safest, most abundant and 
affordable food supply in the world.
    I guess my biggest concern is that much more is being asked 
in terms of sacrifice for producers as well as the rural 
communities of this country in the South when you look at all 
of the decisions coming out of this administration, whether it 
is the decisions through the Department of Treasury and the 
OFAC Office in limiting our rice trade, whether it is--and many 
on this committee may agree with--the payment limitations for 
the crops that we grow and that we are suited for, the fact 
that we are different and the diversity that exists.
    I would just say that, both in recognizing my 
responsibility to raising my children but also the 
responsibility I have to the people I represent in the Senate, 
consistency is critical. It is critical in the trust that we 
develop and the important element of making sure that 
government is a positive part of who we are and what we can do 
in the global community.
    I would just ask of you, as a part of the Department of 
Agriculture, that we can really look at these long-term 
commitments that are being made to our farmers. I know last 
week I was with my farmers and their bankers and the folks that 
they do business with in rural America who are not just seeing 
cuts in agriculture programs, but seeing cuts in their COPS 
programs and their Medicaid dollars and their health care 
providers are up against the wall. I guess it is just making 
sure that we can provide for them, in the diversity that exists 
in this country, the peace of mind that their government is 
going to support them just as it does the other regions of the 
nation. That is something that is going to be really, really 
critical for us in the coming years and we hope that you will 
be there with us.
    I guess, in closing, my comments would be that I hope that 
you will provide us here on the committee the assurances that 
you will be an advocate for the current law that we negotiated 
out in good faith that recognizes the regional differences, 
where everyone came to the table and gave a little bit to come 
up with a compromise.
    I hope that you will also reassure us, or at least explain 
to us what kind of a message we give to the rest of the world 
when we say that we are ready to lower our supports to our 
producers before we get a commitment from our trading 
competition to help level the global disparities. If what we 
are going to do is ask our producers to be competitive in a 
global marketplace, let us help frame the environment they are 
in in a reasonable way.
    I guess, Mr. Conner, I am asking for your help, because I 
can't explain to my farmers any more than what I have done, and 
I hope that you will join me and that you will bring the 
Secretary with you as we come, and perhaps travel to Arkansas 
so that you can help me explain what it is we are asking of our 
producers, particularly in that region of the nation, to 
contribute to what this great country is all about.
    Is there some way I can get an assurance from you on a 
couple of those things?
    Mr. Conner. Well, let me--Senator, I appreciate your 
comments and I know they come from deep within your heart, as 
mine do, as well, and I appreciate that.
    In terms of assurance, let me just share a couple of 
thoughts with you and perhaps we can talk more about this if 
you want in subsequent questions. We are willing to work with 
you on these issues. In the President's budget, you are at a 
little bit of a disadvantage in that if the budget process were 
a poker game, you probably wouldn't want to bet on the 
President because he has to show his hand early in that 
process, and we have done that. We have put the issues out 
there on the table----
    Senator Lincoln. Well, if he is bluffing me, I am OK, but--
--
    [Laughter.]
    Senator Lincoln. Let me know now.
    [Laughter.]
    Mr. Conner. It is a pretty poor bluff if he is, Senator.
    [Laughter.]
    Mr. Conner. Again, let me just say, and if there has been a 
theme this morning perhaps of who I am, it is the fact that we 
are dealing with issues here that are very controversial, not 
just between the administration and you, Senator, but between 
members of this committee, and there are extremely wide and 
diverse opinions on this committee over the issues that you 
raised, payment limits being a very, very obvious one, and 
there is sharp, sharp division here in this committee.
    My point is simply I want to help you play a role of being 
the--a bad word, I guess, in these kind of times, but the 
reconciliation person in those differences. It is a role that I 
have played in the past for a long, long time. I hope some of 
the testimony given here this morning says that it is a role 
that I played successfully and I certainly see no reason that 
that is going to change when I--if I am confirmed and become 
the Deputy Secretary of Agriculture. It is the role that I 
played when I was with the President in the 2002 Farm bill. 
Former Chairman Combest can speak for himself, but I believe he 
would tell you that that is the role that I played with him 
coming in a little bit late in the game, but immediately tried 
to move us into a constructive position. We want to be 
constructive in this process and I commit that to you.
    Senator Lincoln. I appreciate that. There are many people 
around that table. There are not just these here that may 
disagree in the Congress, but there are international elements 
involved, as well, that are a huge part of this global 
marketplace that we find ourselves ever more in a competitive 
nature.
    I hope you won't ask me to fold, because I don't want to 
have to fold at this poker game----
    Mr. Conner. Indeed.
    [Laughter.]
    Senator Lincoln [continuing]. On behalf of my farmers. I 
would very much like to ask you and the Secretary to travel to 
our part of the country and to answer the questions of my 
farmers and see the capital-intensive investment they have to 
make in the crops that they are best-suited to grow to compete 
on the world marketplace. I hope I at least have that 
commitment from you.
    Mr. Conner. You do have that commitment from me, Senator. I 
can assure you that there are things in the works that are 
going to take us to your great State, and frankly, many others 
as the Secretary--I know his passion is to get on the road and 
to get some views of the farmers out on the local level.
    Senator Lincoln. Well, I hope that will be sooner than 
later, because as I said, the answers that I have are exhausted 
in terms of what we need to do.
    Mr. Conner. I will just tell you, Senator, the last time I 
was in your State on an agricultural matter, I was in a Tyson 
chicken plant. That was an experience beyond description, to be 
inside that plant----
    Senator Lincoln. Yes, it is. I have been there, too.
    Mr. Conner [continuing]. I look forward to a different 
view, perhaps, when I come down.
    [Laughter.]
    Senator Lincoln. Good luck.
    The Chairman. I am told by the floor that they are going to 
keep the vote open until 10:30, which means we have 9 minutes 
left.
    Senator Salazar.
    Senator Salazar. Thank you very much, Mr. Chairman, and 
congratulations, Mr. Conner, to you and to your wonderful 
family. I wish you the very best of success in this new 
position.
    Mr. Conner. Thank you.
    Senator Salazar. Let me be brief and just make three quick 
points. One, I would request of you, and you don't have to 
comment today, but to get a response from Secretary Johanns on 
a letter that I sent to him on March 10 concerning the ban on 
Canadian beef imports. I believe that we need to move forward 
with a process that makes sure that we are protecting consumers 
and ranchers here in our nation, and it is incumbent upon the 
Secretary, given where we are, to at least lay out where we are 
and where we are going, and I made that request of him, so if 
you would look into that for me, I would very much appreciate 
it.
    Mr. Conner. I will.
    Senator Salazar. Second, I wanted to just echo the concerns 
that you have heard here from my colleagues this morning in 
terms of investment to rural America and to agriculture. 
Talking about farmers and ranchers is sometimes like talking 
about motherhood and apple pie. It is very different when we 
ask our government to work with farmers and ranchers to walk 
the talk. It is easy to do the talk on supporting farmers and 
ranchers. I know that from a statistical point of view, you can 
make an argument that some things are improving in the 
agricultural economy.
    Well, at least in my State, when I travel through the 
Eastern plains of Colorado and down to the San Luis Valley and 
places that are some of the poorest counties in the United 
States of America, I can tell you that these family farmers and 
ranchers are suffering and many of our agricultural communities 
continue to wither on the vine. I will just join the chorus of 
concerns that you heard here from my colleagues about the 
President's budget.
    It is easy to say you support farmers and ranchers in 
America. It is another thing to actually do it. From my point 
of view, Mr. Conner, the budget that the President has proposed 
does not do the job. It leaves out a small portion of our 
overall population out in the cold because they don't have the 
same kind of opportunities in my State, for example, that 
people would have in Denver, Colorado, or in the larger cities. 
I would hope that part of the commitment that we see from you 
in your new position is to help us make sure that we are 
prioritizing what I call the forgotten America.
    With that, Mr. Chairman, given our time limits, I don't 
need a response. I will just go yield to you so you can 
conclude.
    Mr. Conner. I appreciate your comments, Senator Salazar.
    The Chairman. Thank you very much. Senator Baucus.
    Senator Baucus. Thank you, Mr. Chairman.
    I would also like to chime in on the point that Senator 
Salazar made. You responded to Senator Conrad's question about 
why are we cutting our budget now. We have to negotiate. Your 
basic response was, well, gee, the farmers are doing pretty 
well. You cited some numbers, farm income is up and so forth. I 
don't know about those numbers, but whatever they are, as you 
know as well as anyone, it is the tyranny of averages. Average 
numbers don't really mean a lot. We are such a large country 
with so many pockets of income that is low. There are pockets 
of farmers where income is low. Senator Salazar mentioned parts 
of Colorado. The same is true in, I would say, most of Montana.
    Those numbers you used, I don't know, again, what all was 
in it, and I know you know this, but I just wish the USDA 
would, on a proportionate basis, stand up a little more for the 
producer, because the industry can pretty well take care of 
itself. They have different means, different ways of doing 
things. The producers don't have any other ways. As you know, 
they are at the mercy of price, the mercy of the weather, and 
all that. The big boys, they can take care of themselves. The 
big boys also, unfortunately, have much better access to you 
because they are in Washington. They have people working for 
them in Washington. The farmers don't. The farmers depend upon 
us.
    What I would like to know is your telephone number. You 
mentioned that you had an open line to everybody, and I want my 
Montana farmers to give you a telephone call.
    Mr. Conner. Well----
    Senator Baucus. Would you give me a number, please?
    Mr. Conner. Senator Baucus, I am not over at USDA yet, but 
I----
    Senator Baucus. Well, give me your number that you have. 
What is the number to reach you at right now?
    Mr. Conner. At right now?
    Senator Baucus. Yes.
    Mr. Conner. It is 202-456-7804----
    Senator Baucus. Four-56-7804.
    Mr. Conner [continuing]. As some of the people in this room 
can tell you, that rings at my desk. One thing you learn at the 
White House is it is a lean operation, so there is nobody there 
to pick it up but me.
    Senator Baucus. Right. I appreciate that, because in 
Montana, I take all calls from all Montanans unscreened. I 
don't care who it is. I take the telephone call.
    Mr. Conner. That is my policy.
    Senator Baucus. I give my personal e-mail, not the office 
e-mail, my personal, private e-mail to all Montanans. I know 
that it helps.
    Mr. Conner. Yes.
    Senator Baucus. I applaud you for having the same policy. 
You gave us your number, thank you, so people have an 
opportunity to talk to you, too.
    Mr. Conner. Absolutely.
    Senator Baucus. I appreciate that. When I was home during 
the break, I ran into a lot of anger, frankly, from farmers who 
were wondering when will they be able to sign up for the 
Agriculture Disaster Assistance Program. We were promised first 
of the year. That was promised by USDA. Now we are told it is 
March. There is no software at the offices in Montana. Now we 
are told we won't get checks until maybe October.
    Mr. Conner. Right.
    Senator Baucus. That is inexcusable, and you will agree. 
There is not much----
    Mr. Conner. I will----
    Senator Baucus [continuing]. I called Secretary Johanns 
about this. As things work, you have to, to some degree, and he 
said he would look into it and try to help. My office followed 
up with people at the USDA just getting the run around. The 
follow-up calls that my office is making on this are just run-
around telephone calls. It is a stone wall. I am asking you now 
to follow up if you could, please, and see what in the world is 
going on here. We have to get that software out there. We have 
to get these offices up and running and we have to get those 
checks out earlier than October.
    Mr. Conner. Senator, I will assure you I can do that. There 
was the software. It was out and it was up and was running for 
several hours. Then they figured out that there was some kind 
of a glitch in it and they had to shut it back down. They 
tried--and it's no explanation other than to say we know that 
this is not the kind of performance we expect, and I can assure 
you we will push on this issue.
    Senator Baucus. Can you get back to--you are going to be 
confirmed, and you will be a very good Deputy Secretary, but 
within a week of your confirmation, if you personally could 
give me a telephone call and give me an update----
    Mr. Conner. Yes. I would be happy to do that, Senator, 
absolutely.
    Senator Baucus. Do you want my telephone number?
    [Laughter.]
    Mr. Conner. They know how to get hold of you.
    [Laughter.]
    Senator Baucus. Thank you. Thank you very much.
    Mr. Conner. Thank you.
    Senator Baucus. Thank you, Mr. Chairman.
    The Chairman. Mr. Conner, you will find that every farmer 
in America is listening to this over C-SPAN today and your 
voice mail will be full----
    [Laughter.]
    The Chairman [continuing]. By the time you get back.
    Mr. Conner. Well----
    The Chairman. Senator Coleman, Senator Baucus and I are 
going to go vote before the vote was ended close this down, so 
I am going to turn this over to you to wind up and let you have 
all the time you need for questions for Mr. Conner.
    Senator Coleman. This is a rare opportunity, Mr. Chairman.
    [Laughter.]
    The Chairman. He is under oath, so----
    Mr. Conner. They said you were my friend, Mr. Chairman.
    [Laughter.]
    The Chairman. Let me just announce that the record will be 
left open until Friday, April 8. Mr. Conner, there may be 
written questions that will be submitted to you. I would urge 
you to get those back very quickly because it is my intention 
to bring your nomination to a vote as soon as possible next 
week. If you could get those right back to us, if there are any 
questions----
    Mr. Conner. We will do that, Mr. Chairman.
    The Chairman. All right. Senator Coleman.
    Senator Coleman [presiding]. Thank you, Mr. Chairman.
    Mr. Conner, it is a great pleasure to be with you today. I 
am looking forward, obviously, to supporting this nomination, 
looking forward to working with you. I appreciate the time you 
spent with us in Minnesota. I know you had some family 
conflicts there and figured out a way to make it happen and I 
am appreciative for that.
    I have just two questions and a statement. We had a chance 
in my office yesterday to raise some concerns and we don't have 
to go over that again today. We did talk a little bit about the 
manner in which the quality loss provisions of the current 
disaster program for my wheat farmers is being implemented.
    Mr. Conner. Yes.
    Senator Coleman. We have concerns under the new disaster 
program. The farmers are just out of luck if national 
adjustments are out of whack, which is what is happening in the 
local market. I just have some real concerns there. Can you 
give me some reassurance? Law should trump regulation. That is 
a pretty fair comment. I hope the USDA will carry out what is 
clear Congressional intent. Can you talk to me a little bit 
about this issue?
    Mr. Conner. Senator Coleman, since our meeting yesterday, I 
have had a chance to very briefly, and I will say a little bit 
superficially, review this issue. What I have found is it is my 
understanding that the problem in Minnesota can be resolved if 
we provide some flexibility back to the State committees, to 
the Farm Service Agency State committee. In the case of--there 
is a similar problem in North Dakota, is what I understand, and 
I noted that there was a communication from Under Secretary 
Gebler to the North Dakota delegation in which some of that 
flexibility was granted in their particular case.
    I need a little bit further time to just review why 
additional flexibility would not be appropriate, as well, in 
the State of Minnesota, which again, is my understanding, would 
probably solve your issues there.
    Senator Coleman. I believe under the old disaster program, 
if quality adjustments nationally weren't reflecting what was 
happening in the local markets, that the State FSAs had that 
kind of discretion.
    Mr. Conner. That is my understanding, as well, Senator.
    Senator Coleman. That would go a long way to helping our 
problem.
    Mr. Conner. We are on it, and I can assure you we will 
figure out what is going on there.
    Senator Coleman. The other issue I want to raise is I 
appreciate the President's strong support for the MILC program. 
I am very appreciative of that and just want a clear sense of a 
commitment to helping us get this important program extended 
for 2007.
    Mr. Conner. Yes. Senator, as you know, the President on 
multiple occasions indicated that he was strongly in favor of 
working with you and other members of this committee and the 
House side in extending that program. Certainly, that 
commitment remains good today and was reflected in the 
President's budget and we look forward to that.
    Senator Coleman. Great. Just a last more of a statement 
rather than a question, two observations. One, standing behind 
a farm bill that still has a couple more years to go without, 
and this is not just to you, but we all have to stand behind 
the Farm bill. I am concerned in some of the budget discussions 
about the impact on growers and producers who have made 
commitments, saying these are the rules of the game. It is a 
little discouraging at times when there are budget proposals on 
the table that appear to put us in a position of changing those 
rules. It is hard for folks who have made commitments and work 
with their bankers and others with an expectation of what the 
lay of the land is to all of a sudden have a sense that land 
may be shifting. It is a little disconcerting. I just hope we 
continue to have great sensitivity to that and stand firm 
behind the bill that we have as we look forward to working on a 
new one.
    Then the last observation is on the issue of trade, that as 
we move forward on the WTO discussions, that again we stand 
behind this farm bill. That is important. It is important that 
our growers and producers are the great beneficiaries of trade. 
I understand that. On the other hand, as we negotiate bilateral 
and regional agreements, it sometimes pits one set of growers 
against another and that concerns me, deeply concerns me.
    If we can do the things we can to look at things and see 
that they are handled in a global context--sugar, for 
instance--we all would be better off. It is a little, I don't 
know if the word is ``dangerous,'' but it is certainly a 
concern to me if we seem to be pitting one group of growers and 
producers against the other. Hopefully we will keep that in 
mind.
    I look forward to working with you. It is a great 
opportunity. The President has been tremendously supportive of 
agriculture, tremendously supportive, and the key to that is 
surrounding himself with great talent. Secretary Johanns was a 
friend of mine when he was the Mayor of Lincoln, Nebraska, and 
I was the Mayor of St. Paul, Minnesota, two capital cities. He 
is an extraordinary man and I said he is a really smart guy 
because he was educated, he and his wife, in Minnesota, so 
clearly that is a----
    [Laughter.]
    Senator Coleman [continuing]. I know how smart he is. With 
that, I look forward to working with you.
    Mr. Conner. Likewise, Senator Coleman. Thank you.
    Senator Coleman. This hearing is now adjourned.
    [Whereupon, at 10:36 a.m., the committee was adjourned.]
      
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                         QUESTIONS AND ANSWERS

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