[Senate Hearing 115-602]
[From the U.S. Government Publishing Office]
S. Hrg. 115-602
NOMINATION HEARING:
GLEN SMITH, TO BE A MEMBER OF
THE FARM CREDIT ADMINISTRATION BOARD,
FARM CREDIT UNION, AND
STEPHEN ALEXANDER VADEN, TO BE
GENERAL COUNSEL OF
THE DEPARTMENT OF AGRICULTURE
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON AGRICULTURE,
NUTRITION, AND FORESTRY
UNITED STATES SENATE
ONE HUNDRED FIFTEENTH CONGRESS
FIRST SESSION
__________
NOVEMBER 9, 2017
__________
Printed for the use of the
Committee on Agriculture, Nutrition, and Forestry
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__________
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COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY
PAT ROBERTS, Kansas, Chairman
THAD COCHRAN, Mississippi DEBBIE STABENOW, Michigan
MITCH McCONNELL, Kentucky PATRICK J. LEAHY, Vermont
JOHN BOOZMAN, Arkansas SHERROD BROWN, Ohio
JOHN HOEVEN, North Dakota AMY KLOBUCHAR, Minnesota
JONI ERNST, Iowa MICHAEL BENNET, Colorado
CHARLES GRASSLEY, Iowa KIRSTEN GILLIBRAND, New York
JOHN THUNE, South Dakota JOE DONNELLY, Indiana
STEVE DAINES, Montana HEIDI HEITKAMP, North Dakota
DAVID PERDUE, Georgia ROBERT P. CASEY, Jr., Pennsylvania
LUTHER STRANGE, Alabama CHRIS VAN HOLLEN, Maryland
James A. Glueck, Jr., Majority Staff Director
DaNita M. Murray, Majority Chief Counsel
Jessica L. Williams, Chief Clerk
Joseph A. Shultz, Minority Staff Director
Mary Beth Schultz, Minority Chief Counsel
(ii)
C O N T E N T S
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Page
Hearing(s):
Nomination Hearing: Glen Smith, to be a Member of the Farm Credit
Administration Board, Farm Credit Union, and Stephen Alexander
Vaden, to be General Counsel of the Department of Agriculture.. 1
----------
Thursday, November 9, 2017
STATEMENTS PRESENTED BY SENATORS
Boozman, Hon. John, U.S. Senator from the State of Arkansas...... 1
Stabenow, Hon. Debbie, U.S. Senator from the State of Michigan... 2
Alexander, Hon. Lamar, U.S. Senator from the State of Tennessee.. 5
Corker, Hon. Bob, U.S. Senator from the State of Tennessee....... 6
Witnesses
Smith, Glen R., of Iowa, to be a Member of the Farm Credit
Administration Board, Farm Credit Association.................. 7
Vaden, Stephen Alexander, of Tennessee, to be General Counsel of
the Department of Agriculture.................................. 8
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APPENDIX
Prepared Statements:
Smith, Glen R................................................ 24
Vaden, Stephen Alexander..................................... 26
Document(s) Submitted for the Record:
5-day letter, Committee questionnaire and Office of
Government Ethics Executive Branch Personnel Public
Financial Disclosure Report filed by Glen R. Smith......... 30-54
5-day letter, Committee questionnaire and Office of
Government Ethics Executive Branch Personnel Public
Financial Disclosure Report filed by Stephen Alexander
Vaden...................................................... 55-95
Question and Answer:
Smith, Glen R.
Written response to questions from Hon. Pat Roberts.......... 98
Written response to questions from Hon. Debbie Stabenow...... 99
Written response to questions from Hon. Amy Klobuchar........ 102
Vaden, Stephen Alexander:
Written response to questions from Hon. Pat Roberts.......... 104
Written response to questions from Hon. Debbie Stabenow...... 106
Written response to questions from Hon. Patrick J. Leahy..... 122
Written response to questions from Hon. Sherrod Brown........ 125
Written response to questions from Hon. Michael Bennet....... 129
Written response to questions from Hon. Chris Van Hollen..... 130
NOMINATION HEARING:
GLEN SMITH, TO BE A MEMBER OF
THE FARM CREDIT ADMINISTRATION BOARD,
FARM CREDIT UNION, AND
STEPHEN ALEXANDER VADEN, TO BE
GENERAL COUNSEL OF
THE DEPARTMENT OF AGRICULTURE
----------
Thursday, November 9, 2017
United States Senate,
Committee on Agriculture, Nutrition, and Forestry,
Washington, DC
The Committee met, pursuant to notice, at 9:33 a.m., in
Room 328A, Russell Senate Office Building, Senator John
Boozman, presiding.
Present or submitting a statement: Senators Boozman,
Hoeven, Ernst, Grassley, Thune, Daines, Perdue, Stabenow,
Brown, Klobuchar, Bennet, Gillibrand, Donnelly, Heitkamp,
Casey, and Van Hollen.
STATEMENT OF HON. JOHN BOOZMAN, U.S. SENATOR FROM THE STATE OF
ARKANSAS
Senator Boozman. I call this hearing of the Senate
Agriculture, Nutrition, and Forestry Committee to order.
Chairman Roberts has had a--just a routine outpatient procedure
and as a result of that I am chairing today and offering a
statement that I am about to present in his stead. He will
return to the Senate on Monday.
We are here today to review the nominations of the
individuals before us today, Glen Smith, to be a Board member
of the Farm Credit Administration, and Mr. Stephen Vaden for
the position of General Counsel of the Department of
Agriculture.
For the last few months, this Committee has been reviewing
and approving nominations for the agencies under its
jurisdiction in order to help provide them with political
leadership. It is crucial to have decision-makers tending to
the important mission areas at the Department of Agriculture,
the CFTC, and the Farm Credit Administration.
Today we have an opportunity to review the nominations of
two distinguished individuals, one to head USDA's Office of
General Counsel, and the other to serve on the Farm Credit
Administration Board, which is tasked with ensuring the safety
and soundness of financial institutions comprising the Farm
Credit System. Legal and financial issues are not only touching
our stakeholders every day, but the people who benefit from the
hard work of our farmers and ranchers, the consumers.
We have talked about the challenging times farmers,
ranchers, and their families are facing in rural America. Those
challenges come not only from what Mother Nature throws at them
but the regulations, the rules, and costly burdens placed upon
the agriculture and forestry sector, including numerous and
sometimes frivolous lawsuits. The FCA Board will also be faced
with potential decisions regarding regulatory tools meant to
enable the lending system to responsibly support producers
during times such as these.
During these uncertain times, we need these nominees to
prioritize farmers and ranchers as they review legal questions
or the ins and outs of how our Farm Credit System is
functioning. We have two very qualified nominees before us
today, and I am happy that the Committee has the opportunity to
examine their credentials and experience as we endeavor to get
them working in their new roles as soon as possible.
Our first witness today is Mr. Glen Smith, who was
nominated to serve as a member of the Farm Credit
Administration. As noted, Mr. Smith is a native of Atlantic,
Iowa, and a graduate of Iowa State University. He is President
and Co-Owner of Smith Land Service, a company which specializes
in farm management, land appraisal, and farm and brokerage
services. Mr. Smith also owns and serves as President of Smith
Generation Farms, Inc., a family farm operation that
encompasses about 2,000 acres in western Iowa.
Our next witness, Mr. Stephen Vaden, the President's
nominee to serve as the Department of Agriculture's General
Counsel, has a B.A. from Vanderbilt University and a J.D. from
Yale Law School. He served as law clerk for Julia Smith Gibbons
of the United States Court of Appeals for the Sixth Circuit,
and for Samuel H. Mays, Jr., of the United States District
Court for the Western District of Tennessee.
Prior to his experience at USDA, he has practiced law at
the law firms of Patton Boggs and Jones Day, where he gained
significant experience in government regulations law,
litigation, administrative law, and appellate work. He is
licensed to practice law in Tennessee and the District of
Columbia. Stephen has been serving in the Office of General
Counsel in various way, acting in that capacity for the last
few months.
It is the Chairman's hope that the Committee consider and
approve your nominations as quickly as possible so we can send
them to the full Senate for consideration.
I look forward to your testimony and I now turn to my
colleague, Senator Stabenow, for opening remarks.
STATEMENT OF HON. DEBBIE STABENOW, U.S. SENATOR FROM THE STATE
OF MICHIGAN
Senator Stabenow. Well, thank you very much, Mister Acting
Chairman, and it is always great to work with you. We worked
together on forestry and paper issues, along with other issues
that relate to the Agriculture Committee, and I know that
Senator Roberts will be back in full form next week, so we are
looking forward to that.
I am pleased to be here today to consider the final two
nominees that we currently have pending before our Committee,
and welcome to our two distinguished colleagues, who I know are
going to be involved in introductions as well.
Mr. Vaden and Mr. Smith, congratulations to you and welcome
to your families today. We are glad to have them here as well.
Considering presidential nominations is a key
responsibility of the Senate and one that this Committee takes
very seriously. This Committee has worked hard to move nine
USDA and CFTC nominees this year in an efficient and bipartisan
manner. I am glad to see two more nominees before us today.
Mr. Vaden, being the top lawyer at one of the largest
Federal departments is a very important job. If confirmed as
General Counsel, your work will touch every corner of the USDA,
from advising the Secretary to enforcing civil rights and
workplace protections for nearly 100,000 employees across the
department. You will oversee the implementation of rules that
protect our farmers and our families. Additionally, it will be
up to you to ensure that USDA's own rulemaking is fair and
transparent.
Mr. Vaden, you have been a senior leader at the USDA since
Inauguration Day. Today I look forward to learning more about
the role that you have played in the last 10 months. I also
have a few questions about your previous work as an associate
at a law firm, handling voting access cases, which I hope you
can address today. Overall, I am interested in hearing about
your experience, qualifications, and vision for this very
important position.
Mr. Smith, while we have considered several USDA nominees
this Congress, you are the first nominee before us for the Farm
Credit Administration. Throughout this year I have underscored
the importance of having qualified, dedicated leaders to serve
our farmers and ranchers across the government and the Farm
Credit Administration is no exception.
The Farm Credit System ensures that rural communities and
agricultural producers of all types and sizes have reliable
access to credit. This is especially pressing given the recent
slowdown in the farm economy and devastating natural disasters,
as you and I have had a chance to talk about.
We also know that new and beginning farmers face unique
challenges in accessing capital as they look to start a career
on the farm. In my home state of Michigan, Greenstone Farm
Credit provides more than $6 billion in loans to producers,
including more than 17,000 small, new, or beginning farmers,
including our veterans. Now more than ever, it is critical that
our farmers and rural communities have a dependable source of
credit they can count on.
I am very proud of how this Committee has worked together
to consider qualified leaders as quickly as possible. These
gentlemen are the last nominees pending before our Committee.
In order for us to continue to fill vacant leadership
positions, we need the administration to nominate qualified
candidates to come before us. As of now, we are still waiting
to receive nominees for almost half of the Senate-confirmed
positions at the USDA. I urge the Trump Administration to
nominate experienced and qualified people for these roles as
soon as possible, so we can ensure the department is running at
100 percent. Our farmers and ranchers in rural communities
deserve no less, and I look forward to working with all the
members in the Committee to make sure that happens.
Thank you.
Chairman Boozman. Thank you, Senator. As is our tradition
at the Agriculture Committee, we like to recognize the family
and the friends of the nominees who have gathered today. Please
stand to be recognized.
Very good.
[Applause.]
Senator Boozman. We do appreciate you being here. These
things are certainly family affairs.
It is also a privilege to welcome two distinguished members
of the Tennessee delegation to the Committee, Senator Alexander
and Representative David Kustoff, and Senator Corker. They are
here to support their friend and colleague, Stephen Vaden.
Thank you all for joining us at this important hearing.
I now turn to Senator Ernst to introduce our first nominee,
Glen Smith from Iowa.
Senator Ernst. Thank you, Mr. Chair. It is my pleasure
today to introduce Glen Smith. Glen Smith is President of Smith
Land Service, a company he founded in 1982. The company
specializes in farm management, land appraisal, and farmland
brokerage services, working in about 30 of Iowa's counties.
Glen also owns and serves as President of Smith Generation
Farms, Inc., a family farm operation that encompasses about
2,000 acres of corn and soybeans in western Iowa.
Glen was raised on a diversified crop and livestock farm
near Atlantic, Iowa, which is just down the road from my home
in Red Oak, so thank you very much, Glen. When he graduated
from Iowa State University, which is also my alma mater, in
1979, with a B.S. in agricultural business, he went to work for
Doane Agricultural Services as state manager of their real
estate division.
Glen and his wife Fauzan have four grown children and three
grandchildren. Welcome to the Committee, Glen. We are glad to
have you here, and welcome to your family as well. Thank you
very much.
Senator Boozman. Senator Grassley.
Senator Grassley. I associate myself with the remarks of
Senator Ernst and also add that there are good people coming
out of Atlantic besides Mr. Smith. I had a press secretary of
15 years, Beth Pellet, and Nancy Pellet, her mother, had a
position similar to Mr.--or the same as Mr. Smith's a few years
ago in a previous Republican administration.
So I said I associate myself with the comments that are
made by my colleague. I have known Glen for several years and
know that he would do an outstanding job for farmers and
ranchers at the Farm Credit Administration. He has worked in
agriculture industry his whole career and will bring his
Atlantic, Iowa, common sense and leadership to this Board. I
look forward to working with him when he is confirmed, and we
welcome you to the Committee, and I am going to be very rude
because I have got to chair the Judiciary Committee in 12
minutes, so I will be leaving.
Senator Boozman. Thank you, Senator Grassley.
Senator Alexander, it is an honor to have you with us
today. Thank you for taking the time to introduce Mr. Vaden.
STATEMENT OF HON. LAMAR ALEXANDER, U.S. SENATOR FROM THE STATE
OF TENNESSEE
Senator Alexander. Thank you, Mr. Chairman, and thanks for
allowing me to come. First, I want to thank the Committee for
supporting the Tennessee Wilderness Act this morning. Senator
Corker and I have introduced that in five separate Congresses.
This is the fifth one. I see Senator Stabenow smiling. She has
helped us with that before. The legislation would preserve
20,000 acres of Cherokee National Forest as wilderness. We hear
about it from many, many Tennesseans.
I wish to submit a statement on this legislation for the
Committee record and express my hope that the Congress can
enact on it while Senator Corker is still a member of the
United State Senate, which means this year.
Senator Alexander. Second, attending these always reminds
me of the time, several years ago, when I came before a
confirmation hearing and the Senator from Ohio's turn came and
he looked at me and said, ``Governor Alexander, I have heard
some very disturbing things about you, but I do not think I
will bring them up now.'' Senator Kassebaum from Kansas looked
over and said, ``Well, Howard, I think you just did.''
I do not think any of that will happen to the two of you
today because of your distinguished records, and I know the
members of the Committee well.
I am here to introduce Stephen Vaden. I am proud to do
that. You mentioned his background, Mr. Chairman, so I will not
go into extensive detail. He grew up on a family farm in Union
City, Tennessee. His father was a farmer so he has hands-on
experience for this job. He attended Vanderbilt University and
Yale Law School, so he has some academic credentials for the
job of legal counsel, which are strong. He has had two strong
mentors, Julia Gibbons, a Sixth Circuit Court of Appeals member
who was once my counsel when I was governor of Tennessee, and
Hardy Mays of U.S. District Court for the Western District of
Tennessee, and he has practiced law with two distinguished
firms in Washington.
So based on his hands-on experience, his strong academic
credentials, his mentorships, his practice of law, and the time
he has had here the last few months, he is very well qualified.
Also, he is strongly supported by his Congressman, David
Kustoff of West Tennessee, who is here today, and we are
delighted to have him. The Tennessee Farm Bureau President says
that Stephen ``has a passion for agriculture that cannot be
taught but that is necessary in the role of General Counsel.''
Congressman Kustoff said this year, ``I have had the
pleasure of working with Stephen. I cannot think of anyone
better equipped to champion our agriculture industries in West
Tennessee and across the country.'' Secretary Perdue said,
``Stephen has a firm grasp of the legal issues facing American
agriculture and, more importantly, understands the breadth and
complexity of the regulatory burden placed upon our
producers.'' He finished by saying, ``Farmers, ranchers,
foresters, and producers will be well served by his counsel.''
So I am delighted to strongly recommend Stephen to this
Committee. I urge the Committee members to support his
nomination. I hope he can be quickly considered by the full
Senate.
Thank you for your time.
Senator Boozman. Thank you, Senator Alexander, and thank
you, Congressman Kustoff, for being here to show your support.
We are also honored to have Senator Corker here.
STATEMENT OF HON. BOB CORKER, U.S. SENATOR FROM THE STATE OF
TENNESSEE
Senator Corker. Mr. Chairman and Ranking Member Stabenow,
thank you so much for letting me be here with Lamar, my good
friend, and David Kustoff, my friend, to support this
outstanding nominee. I want to also thank you for considering
the Wilderness Bill this morning. It is something that I think
matters greatly to our country, and we thank you for that.
I want to also thank you. I have never been before the Ag
Committee. I have been here 10 years and 10 months, and so my
Senate bucket list is now narrowing, so thank you so much.
[Laughter.]
Senator Boozman. We are going to have you back.
Senator Corker. Yes, thanks. I am pleased to be here with
you today to introduce Stephen Vaden, who has been nominated to
serve as General Counsel to the Department of Agriculture. I
would like to extend a warm welcome to Stephen and those here
supporting him, and I am sure he will introduce them shortly.
He is a native of West Tennessee. Stephen attended
Vanderbilt University as an undergraduate and obtained his law
degree from Yale University. After serving as a clerk on the
U.S. District Court of the Western District of Tennessee and
the U.S. Court of Appeals for the Sixth Circuit, Stephen went
on to practice law at Patton Boggs, most recently at Jones Day.
At both firms, his practice centered on litigation, election
law, and administrative law.
This is pretty amazing. When not in Washington, Stephen
returns home to Union City, Tennessee--it is very difficult to
get to Union City, Tennessee--where his family-owned farm has
operated for generations. Growing up and working on that farm
has given him profound insight into the issues facing the
agriculture community. I am confident Stephen understands the
needs of farmers and will be an important asset as we work to
help rural America prosper and grow, and I thank this Committee
for focusing on that so much.
I wholeheartedly support his nomination. I thank the
Committee for holding this hearing, and encourage my colleagues
to support his nomination. Again, thank you so much for the
courtesy. It is great to be with all of you.
Senator Boozman. Thank you, Senator Corker, for being here,
very much.
Senator Stabenow. Mr. Chairman, Senator Klobuchar had
suggested that if we counted the two Senators that were at the
end of the table, from Tennessee, as honorary members, we could
actually vote out the bill. Just a thought.
Senator Boozman. Whatever it takes.
[Laughter.]
Senator Boozman. Seeing a quorum is present now, this
hearing stands in recess.
[Whereupon, at 9:50 a.m., the Committee recessed and moved
to executive session, and reconvened at 9:53 a.m.]
Senator Boozman. I now reconvene the Nominations Hearing,
and thank you both--thank all of you for your patience and
thank you for your patience, particularly our witnesses.
In following the tradition and custom of the Committee,
before nominee witnesses are to provide testimony, I need to
administer the oath. If you both could please stand and raise
your right hands.
First, do you swear that the testimony you are about to
present is the truth, the whole truth, and nothing but the
truth, so help you God?
Mr. Smith. I do.
Mr. Vaden. I do.
Senator Boozman. Do you agree that if confirmed you will
appear before any duly constituted committee of Congress if
asked to appear?
Mr. Smith. I do.
Mr. Vaden. I do.
Senator Boozman. Thank you. We look forward to your
testimony.
Mr. Smith.
TESTIMONY OF GLEN R. SMITH, OF IOWA, TO BE A MEMBER OF THE FARM
CREDIT ADMINISTRATION BOARD, FARM CREDIT ASSOCIATION.
Mr. Smith. Mr. Chairman, Ranking Member Stabenow, and
members of the Committee. My name is Glen R. Smith of Atlantic,
Iowa. This past September, President Trump nominated me to
serve on the Board of the Farm Credit Administration. I am
truly humbled by the honor of this nomination, but also quite
sobered by the huge responsibility, if confirmed, of having a
role of ensuring that American agriculture continues to have a
source for reliable, secure credit, which happens to be the
mission of Farm Credit. I felt it was important for most of my
family to be here to witness and experience the magnitude of
that responsibility, and I thank you for the acknowledgment and
the introduction. I might add that two of these, my son and my
son-in-law, left a combine idle in the field back in Iowa, and
if anybody is familiar with this time of year, I assured them
that we would get them through just as soon as possible--not
that I have anything to do with that, right?
Anyway, as an active farmer, ag-businessman, and even
dating back to my Ag-Finance days at Iowa State University, I
have understood the important role of the Farm Credit
Administration in setting policy, examining and regulating our
nation's largest long-term agricultural lender, the Farm Credit
System. I also understand that the health of American
agriculture is critically dependent upon a healthy, viable Farm
Credit System. Credit is truly the lifeblood of agriculture.
What I would hope to bring to the Board is a keen sense of
agricultural cycles throughout modern history, economic booms
and busts, many of which I have lived through, the challenges
those cycles place on dependable, safe source of credit. I
lived through the boom '70s, my wife and I struggled to survive
and raise a family in the mid '80s, only to prosper the last
20-plus years, exponentially, in a good agricultural economy.
We cannot afford to lose a generation of agriculturalists like
we did in the '80s. Farm Credit can play a key role in
supporting young farmers like my son behind me, who is 27, my
son-in-law and daughter, in their early 30s, that are just
entering their risk-prone susceptible stage in their
agricultural production careers.
As a life-long agriculturalist, I have always considered
myself to be an optimist. As a farmer, you take on the weather,
you take on pests, you take on the markets, and you have to be
an optimist to survive. However, I do have to confess that I am
very concerned about the current agricultural outlook,
particular with younger, risk-prone producers. Land is
typically the dominant asset on a farmer's balance sheet. In
the Midwest alone, we have seen a 15 to 20 percent erosion in
land values over the last several years, and I think it is very
possible we could see another 15 to 20 percent erosion in
values, which I feel would throw a lot of those financial
ratios into a danger category.
The economic prosperity that was enjoyed, roughly in 2006
through 2013, has contributed to some spending habits that may
not be sustainable or no longer supportable, and I truly
believe that low interest rates have camouflaged the difficulty
in paying back principle with after-tax dollars on high-priced
machinery, land, and breeding livestock.
Given the highly capitalized nature of agriculture, an
uptick of only a few percentage points would significantly and
negatively affect farm net operating income, and I believe we
are a long ways away from crisis management, as experienced in
the '80s. However, out of love for this wonderful industry, I
would be a strong advocate for caution in the Farm Credit
System.
Being selected as a Board member would represent one of the
greatest challenges of my life but also potentially the most
rewarding. I feel I would be a reliable, honest representation
of American agriculture and have a vision for its future that
defined my own life. It will not be an easy transition, moving
away from the land and community that has defined our life's
work and love. Hopefully our positive contribution to public
service can offset that severance.
Again, thank you very much for this honor, and I look
forward to your questions.
[The prepared statement of Mr. Smith can be found on page
24 in the appendix.]
Senator Boozman. Thank you, Mr. Smith. Mr. Vaden.
TESTIMONY OF STEPHEN ALEXANDER VADEN, OF TENNESSEE, TO BE
GENERAL COUNSEL OF THE DEPARTMENT OF AGRICULTURE
Mr. Vaden. Thank you, Mr. Chairman, Ranking Member
Stabenow, and members of this Committee. It is an honor to come
before you today as the President's nominee to serve as General
Counsel for the United States Department of Agriculture. I
would like to thank Senator Alexander and Senator Corker for
the very kind words they said about me in introduction,
particularly Senator Corker's remark about getting to Union
City. He is correct. Every Friday evening, I catch the last
fight out of Reagan to Memphis, and then I have a two-hour
drive north to Union City, which gets me home about 1:00 on
Saturday morning, and I take the last flight out Sunday night
to return to Washington, DC, and my work at the Agriculture
Department.
I would also like to thank Congressman Kustoff for being a
supporter of mine since day one, as my hometown Congressman.
Before I respond to your questions I wish to spend a few
moments to tell you about my background and why the President's
nomination, as well as Secretary Perdue's unwavering
confidence, are so personally meaningful to me.
I come from a farming family. My father, John Marshall
Vaden, was born on a farm in rural Obion County, Tennessee, in
April 1918, and engaged in farming his entire life. Following
his death two years ago, my brother and I learned that one of
the family farms that we have inherited has been in the family
since the early 1800s, as it appears in exactly its current
dimensions on the original map of Fulton County, Kentucky, with
the name of my ancestor handwritten across the plat.
It was the profits my father reaped that paved the way for
me to come before you here today. Those profits, wisely
invested over time, helped to pay for the exorbitant tuition
charged by Vanderbilt University and Yale Law School.
They made it possible for me to delay entering the private
sector so that I could clerk for two of our nation's finest
Federal judges, Judge Julia Smith Gibbons of the United States
Court of Appeals for the Sixth Circuit, and Judge Samuel H.
Mays, Jr., of the United States District Court for the Western
District of Tennessee.
They supported my move to the much more expensive
Washington, DC, area, where I entered the private practice of
law, first at the firm of Patton Boggs and later at the firm of
Jones Day. I therefore understand why low commodity prices can
be so harmful to the futures of those who come from rural
communities, such as myself.
As I am nominated for the role of General Counsel, it is
important for me to spend a few moments reviewing my legal
experience. My practice has focused primarily on three main
areas: litigation, particularly appellate litigation;
administrative law; and regulatory compliance. These happen to
be three of the principal areas of concern for any department's
general counsel.
The briefs I have drafted and the cases I have argued have
covered areas of law as diverse as the procedural requirements
of the Administrative Procedure Act, the confines of the First
Amendment's protections, the transparency requirements imposed
upon Federal agencies by the Freedom of Information Act, the
fiduciary duties of corporate officers, and the procedural
protections provided to union members to safeguard their
elections, to name just a few.
My practice, thus, has focused on making certain the
government and others in positions of power follow the legal
guidelines meant to guarantee due process of law. Having been
on the other side of the ``v'' from the government in
litigation, I can understand the trepidation citizens feel when
they must challenge the government's decision. It is the job of
the General Counsel to keep the government to its word by
requiring the Department to follow its constitutional,
statutory, and regulatory responsibilities. I believe that a
general counsel can be considered to have done well if
producers can say that while they did not always agree with the
Department's decisions, they felt their concerns were heard,
and the Department treated them fairly. If confirmed, this is
the goal I aim to meet.
I would be remiss if I did not mention, for the past 11
months, I have served in the Office of General Counsel, first
as a senior advisor, and since the 17th of March, as the
Principal Deputy General Counsel.
Every day I have the high honor of working with 203 of the
finest lawyers in America to perform the legal work necessary
to allow rural America to thrive. We are joined by 54 support
staff, without whom none of us attorneys could get anything
done. As the members of this Committee know all too well, the
men and women of the Office of the General Counsel are
committed to providing legal advice in a timely and
professional manner.
Equally as important, the office provides that advice with
the accumulated knowledge of the challenges that our producers
face to grow the food and fiber that powers America. It is a
charge that each and every member of that office takes
seriously, including myself.
As I mentioned in my opening remarks, my father was a
farmer. Throughout his life he was a grocer, an investor, and a
real estate developer. But it was the title of ``farmer'' of
which he was most proud. I know this because he placed that
title--``Farmer''--below his name on every check I ever saw him
sign. The last three checks he ever signed hang on my wall,
framed, as a reminder of the responsibilities I bear as
Principal Deputy General Counsel, to ensure that America's
producers are treated fairly, equitably, and in accordance with
the law. Should the Senate confirm me to the position of
General Counsel, I commit to you today to carry out the
responsibilities of that office with the same very personal
commitment represented by those checks.
Thank you once again for the opportunity to come before you
here today, and I look forward to answering your questions.
[The prepared statement of Mr. Vaden can be found on page
26 in the appendix.]
Senator Boozman. Thank you, Mr. Vaden and Mr. Smith, very
much, for your testimony.
Mr. Smith, when we met prior to your confirmation hearing
we discussed young and beginning farmers and the difficulties
that they face. I hear often from Arkansans about the high
barriers to enter into production agriculture, and this, as we
all know, is a very serious issue. Like you noted in your
testimony, with the average age of the American farmer now
around 60 years of age, we must have the next generation ready
to produce enough food and fiber to sustain an expected world
population of 9 billion by 2050.
The year 2050 is only 32 harvests away. Could you expand on
what you see the Farm Credit System's role is in supporting and
providing opportunities for these younger, riskier farmers and
ranchers?
Mr. Smith. Thank you, Senator. As I mentioned in my opening
remarks, my concern over the advanced age of the American
farmer, I am 61 and I think the average age of farmers in Iowa
is 62. Sometimes we are still referred to as the young farmers
in the neighborhood, after 35 years. But I think it is an acute
problem and I think it is something that Farm Credit can
address.
As a lender you always have that balance between risk, and
generally younger producers are riskier. There are programs
within FSA that help mitigate that risk and also help eliminate
those hurdles of capital investment up front, and I certainly
would encourage partnerships with Farm Credit and FSA and the
programs that would help beginning farmers get a start.
In Iowa, I am quite proud that we do have some good
programs that offer tax advantage to landlords that choose to
rent their farms to beginning farmers through state tax
credits, and I think it could serve as a good model for other
states around the country. I think we've done some good jobs.
There's also financing for land for livestock, for machinery
also available through the state, to their beginning farmer.
I think in my role with Farm Credit, I do plan to travel
considerably, and I think we could share those ideas. Hopefully
maybe Farm Credit could be a little bit of a clearing house.
What my intention is not is to just have a nice, shiny brochure
on the coffee table saying that we have a beginning farmer
program. I think part of those travels would be to ask some
very specific questions about numbers and about risk
orientation, and success stories along with failure stories,
because risk doesn't go without failure.
Senator Boozman. Great. Very good. Thank you.
Mr. Vaden, there is a longstanding history of USDA,
generally, and specifically the Office of General Counsel,
providing technical assistance to the Committee as we write the
farm bill. This assistance ensures the workability of the
legislation. Will you commit to continuing to provide OGC
resources towards technical assistance for the upcoming farm
bill, for other legislation that helps to ensure the
workability of these programs so the USDA is better able to
defend itself against potential lawsuits?
Mr. Vaden. Absolutely, Mr. Chairman. Thank you for the
question. As I remarked to you during our meeting in your
office, regardless of whether or not the Department may support
a particular bill, it can, of course, always become law. So
it's important that bill be written well, because we are going
to be the ones who are asked to interpret it once it is passed
into law. So we will absolutely continue to provide the
Committee, of both houses of Congress, with technical
assistance when requested.
Senator Boozman. Thank you very much. Senator Stabenow.
Senator Stabenow. Thank very much, Mr. Chairman. First, Mr.
Smith, just a follow-up on Senator Boozman's question on new
and beginning farmers. You and I talked about that as well, and
I know you share the commitment, as you have just spoken about.
I wanted to remind the Committee that in the last farm bill we
included veterans in that category, as you and I talked about,
and there is an extra opportunity for support and assistance
for both new and beginning farmers, but also for those who have
served our country, in other ways that are incredibly
important. We want to make sure we're providing them the same
opportunities. So I appreciate your efforts on that front.
Mr. Vaden, you talked a lot about areas of the law where
you have argued cases, but I think it is important for me to
indicate that there is one area of your past work that you did
not talk about, and that was defending recent state efforts to
restrict voting access for African Americans and other
minorities. This is very troubling. Ensuring that citizens have
access to the right to vote is a bedrock principle of our
democracy. In fact, our democracy thrives when more citizens
participate, and we should be in the business of increasing
voter participation.
If you are confirmed, I would expect you to ensure that
USDA operates in a manner that is consistent with our laws, our
values, our principles, and that all USDA customers and
employees would be treated with dignity and respect.
Let me further go into, just in the interest of time, what
Senator Boozman talked about in terms of providing information
to the Committee, because technical assistance, obviously, is
very important. But it is also very important that we see the
same prompt and full information, provided to myself as Ranking
Member, on the minority side of the Committee, as well as the
majority side.
Earlier this year there was some question about whether or
not that would happen, if there would be responses as we have
always had to my questions as well as the Chairman's. Senator
Roberts and I sent a joint letter, and talked with Secretary
Perdue about this issue. He certainly indicated that he would
work with us on that issue.
But just for the record, will you commit to allowing and
directing USDA officials, including yourself, to respond fully
and promptly to information and requests from me and from all
other members of the Committee, both sides of the aisle, and
commit to providing us with the information that is requested?
Mr. Vaden. Thank you very much for the question, Senator,
and I enjoyed addressing this with you when we spoke in your
office earlier this season.
Yes, Senator, the Secretary has a very simple policy. When
we receive a letter from a Member of Congress we respond.
Senator Stabenow. Great. Thank you very much. Will you
commit to providing the public with transparency about agency
activity to the maximum extent permitted by law?
Mr. Vaden. Senator, as I mentioned in my opening remarks,
one of my past legal experiences has been suing the government
for failing to follow the guidelines of the Freedom of
Information Act, which guarantees citizens access to
information for any reason whatsoever. So having worked on this
issue in the private sector and having seen the frustration
that clients have when they cannot get access to information, I
feel very strongly that citizens should have access to
information to which the law entitles them.
Senator Stabenow. Then, finally, will you also commit to
providing the public with a meaningful opportunity to comment
on proposed agency actions, such as reorganization, and to
considering these comments before making a final decision?
Mr. Vaden. Well, Senator, as you are aware and as we
discussed in your office, for each of the Secretary's moves
that he has made regarding reorganization he has sought and
accepted public comment, and as I think you have seen with the
letters that he has sent to this Committee, as well as the
House Committee, notifying them of the changes that he wants to
make and then following up on that, he does take comments into
account and changes have resulted as a result of comments
received.
Senator Stabenow. Thank you. Then, finally, one other
question. This is a topic you and I have talked about
extensively but it is important to raise because both Senator
Roberts and I feel it is important that it be addressed before
the next farm bill, to be able to help us successfully write a
farm bill and address all the needs of all of our farmers and
ranches in rural communities. In the 2014 Farm Bill, Congress
provided authority to the Federal Crop Insurance Corporation
Board to make decisions related to new insurance products and
improvements to existing products.
We know our dairy farmers are operating without an
effective safety net. It is the one area where I feel we missed
the mark, in terms of the last farm bill, and it needs to be
corrected. There is a corrective mechanism. There is the
authority within the USDA to independently make that decision.
I know that there is ongoing consultation with OMB, but USDA
has the capacity and responsibility to act on behalf of our
dairy farmers.
So I ask you, for the record, will you work to move this
forward so that the issue can come before the next FCIC Board
meeting for decision at the end of the month, so that we can
actually make sure this is part of next year's baseline, as we
go into the farm bill?
Mr. Vaden. Senator, once again I thank you for the
question. As we discussed, just before the hearing, as a matter
of fact----
Senator Stabenow. Right.
Mr. Vaden. --on this very important issue to you, we have
been working this issue, both internally and with the Office of
Management and Budget, and we will continue to do so and make
our points plain to them about what we feel that the law
requires us to do.
Senator Stabenow. Thank you. Just for the record, this is
not only, as you know, of interest to dairy farmers but really
does relate to our capacity to address all of the farm safety
net issues that we need to within the farm bill. So I look
forward to working with you on this. I think it is very
important to our success with the next farm bill.
Thank you, Mr. Chairman.
Senator Boozman. No, thank you, Senator Stabenow, and I
know that Senator Roberts and the entire Committee agree with
you wholeheartedly regarding request and transparency, which is
so, so very important.
Senator Hoeven.
Senator Hoeven. Thank you, Mr. Chairman, Madam Vice
Chairman.
Welcome to both of you. Mr. Smith, how can Farm Credit
Service help our producers in this time of low commodity
prices?
Mr. Smith. I think the role of a lender maybe is a little
similar to the role of a parent. Sometimes saying yes all the
time is not correct. I think close analysis and projection and
models, if we should continue with these low commodity prices,
is essential in looking at new loans or expanding existing
loans with existing customers.
I mean it when I say we need to be cautious. We do not have
the trifecta we did in the '80s with low prices, super-inflated
interest rates, and the third factor would be price supports
that were not relative to the market.
Today, I believe due to crop insurance, we have got a good
safety net there, and I think, particularly with the last farm
bill, this Committee should be commended for that, and I think
a lender should work very closely with the borrower on that
safety net. We do not have high interest rates. That is not
saying 5 or 10 years from now we will not.
Senator Hoeven. So I have got legislation that would raise
the direct loan--the FSA direct loan from $300,000 to $600,000,
and the guarantee from $1.3 to $2.5 million. What is your sense
of that? Is that a good idea, or not, and how would you respond
to that?
Mr. Smith. Well, it is a symptom of the times in that land,
at least in the Midwest, has about tripled in value in the last
12, 13 years. So we have had to stick some added zeroes to add
relevancy to that. But it is debt, and it is debt that has to
be paid back.
Senator Hoeven. Do you think we need the higher limits or
not?
Mr. Smith. Yes, I do, because of the relevancy----
Senator Hoeven. Because of the cost of----
Mr. Smith. Yes.
Senator Hoeven. --production agriculture----
Mr. Smith. The cost of production agriculture.
Senator Hoeven. --has gone up so much. Good.
The average age of the--or the average farmer age now is 60
years old. How do we help get the younger producers in there?
Mr. Smith. Partnerships with lender and existing farmers I
think is one way. Subsidized interest rates through FSA. I know
our firm, we have tried to be a clearinghouse for information
on beginning farmer loans through FSA that partners with local
banks, that can partner with Farm Credit. It is surprising.
There are some good programs out there but it does not seem
like the word gets out a lot of times to the consumers.
Senator Hoeven. But you would agree we need to find ways to
bring--to help younger farmers get involved in production
agriculture.
Mr. Smith. Absolutely. I have got two sitting behind me,
Senator.
Senator Hoeven. Well, that is good.
Mr. Smith. Yep.
Senator Hoeven. Of course, the capital constraints, when
you look at land and equipment, inputs, everything else, that
is part of the challenge, is it not?
Mr. Smith. It is, and I had the question raised earlier in
the week, what difference we see between going into an
uncertain economic time and now. The thing that is most
concerning to me, where in 1981, average land values in our
area was around $2,000. It sunk down to around $685, $700 an
acre. Today we are $7,500, $8,000 an acre.
Senator Hoeven. Right. Exactly.
Mr. Smith. So it is the high cost of capitalization today
that really does worry me.
Senator Hoeven. Right. Right. So you have an important role
to play.
Mr. Vaden, regulatory burdens is an issue for our farmers
now. I mean, it's an issue for all small businesses, so we have
to find ways to reduce the regulatory burden on all small
business. Talk about that in terms of farmers, and then, in
particular, in my state of North Dakota we have a section line
issue where we have had disputes with Forest Service on section
lines, which is very important for our products that we are
able to have those section lines for access. So I want you to
talk about, one, would you be willing to work with me on the
section line issue, and, two, in general, are you willing to
reduce the regulatory burden on our producers, farmers and
ranchers?
Mr. Vaden. Absolutely, Senator. As you have correctly
noted, the burden of regulations on all industries, and in
particular, agriculture, is a very important issue to the
current administration. I know you mentioned an issue regarding
the Forest Service. As you know, we have a new Chief of the
Forest Service, Chief Tooke. I have met with Chief Tooke and he
is--one of the first things that he is engaging in is a look at
how the Forest Service can use its regulatory authority, both
more effectively but use it to reduce the burdens on producers.
Regarding your question about working with you, as I said
earlier in response to questions from both the Chairman and the
Ranking Member, we absolutely will work on you--will work with
you, rather, to help you craft whatever legislation you may
need in order to fix the issue that you see.
Senator Hoeven. Thanks to both of you. I appreciate it and
look forward to working with you.
Senator Boozman. The Chair recognizes Senator Brown for
questions, and also wishes him a big happy birthday.
Senator Brown. Thank you, Mr. Chairman.
Senator Boozman. Show them your birthday cake.
Senator Brown. This is from Senator Klobuchar, who claims
to have made this.
[Laughter.]
Senator Brown. What is interesting is there are 35 others
that look just like it out in the main room.
Senator Stabenow. They are all for you.
Senator Brown. I signed up for Medicare today, too, Mr.
Chairman.
Senator Boozman. Yes, let us cut the cake.
Senator Brown. This is not off my time, is it? Thank you.
Thanks, Mr. Chairman. Mr. Smith, thank you for joining. Mr.
Vaden, thank you, and it was nice to meet you before the
hearing, accompanied by your two Senators.
Mr. Vaden, as you know, USDA's budget--annual budget is
some $125 billion. Its mission is, of course, broad. You can
imagine this Committee's concern that your legal experience, as
listed on your resume, is in election law, Federal campaign
finance law, and the Foreign Agents Registration Act. As far as
I know, the USDA General Counsel does not deal with any of
these matters.
I am also concerned with your lack of managerial
experience, and my question is this. In your testimony, you
noted that the General Counsel's office employs about 250,
including some 200 lawyers. You worked at law firms for six
years prior to this job. What is the largest number of
individuals you ever managed?
Mr. Vaden. Thank you for the question, Senator. As I noted
in response to questions from your staff, when you allowed me
the opportunity to meet with them earlier, it varied by case.
There were some cases where I was the sole attorney responsible
for everything that was going on. There were other cases that
involved litigators that could involve a dozen or more
attorneys.
Senator Brown. So this would be an office of 250, including
200 lawyers, and I guess you are saying in the cases when you
had a big management role it was maybe a dozen. Okay.
Mr. Vaden. Senator, I think it is also important to point
out that for the past 11 months, and beginning March 17th, I
have served as Principal Deputy General Counsel, as the General
Counsel's chair is currently vacant. I have had managerial
responsibility for those 203 attorneys, as well as those 54
support staff. I would respectfully submit to you, sir, that I
think one of the reasons why the first time you heard my name
was when the President announced my nomination is because I
have spent the past 11 months in my office at the Department of
Agriculture, competently carrying out the functions of my job,
both its managerial and legal responsibilities.
Senator Brown. Okay. Let me talk about something you have
done in your practice. Last year you were part of two briefs
that supported efforts by the states of Ohio and North Carolina
to deprive citizens of their right to vote. Senator Stabenow,
the Ranking Member, mentioned this and did not have time to ask
a question. I would like to.
In the North Carolina case, the court found the State
Legislature targeted ``African Americans with almost surgical
precision'' in its efforts to deny the right to vote. In the
Ohio case, the lower court found Ohio's actions also targeted
minorities.
Mr. Vaden, I am deeply concerned you have been involved
with efforts to deny minorities the right to vote and reduce
access to the polls for everyone. I am concerned about what
this might signal for USDA's approach to these issues. What can
you tell me--what can you tell the Committee--I mean, that is
fact, that you were part of that. I would like you to answer,
what can you tell the Committee about your client? Your client
is the Judicial Education Network, your client in both these
cases. What can you tell us about the Judicial Education
Network?
Mr. Vaden. Well, Senator, as you are aware, as an attorney
I am covered by Rule 1.6 of the Rules of Professional Conduct,
which require me to guard client confidences, both of current
clients and former clients. With regard to your question about
the Judicial Education Project, the information on the public
record that was required to be submitted to the Court of
Appeals for the Fourth Circuit, as well as the Court of Appeals
to the Sixth Circuit, in the two cases that you note, list the
information about the background and membership of that
organization. That is a matter----
Senator Brown. But what can you tell----
Mr. Vaden. --of public record.
Senator Brown. --this Committee. Is the Judicial Education
Network a nonprofit?
Mr. Vaden. Senator, I do not have the information in front
of me.
Senator Brown. You do not know? They funded your actions
and you do not know if they are a nonprofit?
Mr. Vaden. Senator, while----
Senator Brown. You, a moment ago, Mr. Vaden, illustrated--I
was about to say bragged--but illustrated that you were a
competent manager for the last number of months, and you do not
know if the group that funded you is a nonprofit? Do you know
who funds the organization? Do you not know any of those
things?
Mr. Vaden. Senator, as an associate at a law firm it was my
job to do the legal work that was assigned to me. It was not
the job of an associate at a law firm to take care of billing
practices.
Senator Brown. Well, I understand. You have such narrow
intellectual curiosity that you were involved in a case that
the court said--that targeted African Americans with surgical
precision, affecting their right to vote, in Ohio the same kind
of--the same kind of--roughly the same kind of language was
used about targeting minorities--and you did not care enough or
know enough. You are a smart guy. You are well educated. You
are obviously a good lawyer. You did not have the--any of--you
did not have any interest in knowing who was funding this and
whether they were a not-for-profit?
Mr. Vaden. Senator, first, thank you for the compliments.
Second of all, as it refers to the Judicial Education Project,
as you know, in both of those cases, its sole function was to
file one amicus brief in each case, and I would note for the
record that in the Ohio case the Sixth Circuit Court of Appeals
disagreed with your characterization of the record----
Senator Brown. Oh, I understand----
Senator Brown. --the Sixth Circuit Court of Appeals. There
is, coming out of the Federalist Society and others, a real
effort to restrict the right to vote in this country. I know
that. It is part of a political movement. I know that. I was
Secretary of State of Ohio in the '80s, and I know how we
expanded the right to vote, and we encouraged people to
register to vote. I know we are in a different time period now,
after the Shelby case, and I know what a lot of young lawyers
are trained to do about targeting right to vote.
But you, again, did--is--who funded this group? I mean, do
you now--do you honestly not know who funds the Judicial
Education Network? Do you honestly not know whether they are a
not-for-profit?
Mr. Vaden. Senator, I would have to refer you to the
information that was filed with the court which explains, on
the public record, who was providing funding for the lawsuit.
Senator Brown. You cannot say to this Committee, yes, it is
a not-for-profit, or no, it is not a not-for-profit? You cannot
say--you cannot give me any indication in this hearing today
who actually funds the Judicial Education Network?
Mr. Vaden. Senator, I have not seen their organizational
paperwork and I would not want to mislead you by speculating.
Senator Brown. It is pretty troubling that you are--you
seem so blissfully unaware of who funded that lawsuit that
clearly was targeted to take people's right to vote away. I am
just stunned by that.
Thanks, Mr. Chairman.
Senator Boozman. Thank you. Senator Ernst.
Senator Ernst. Thank you, Mr. Chair. Thank you, gentlemen,
for being here today.
As both of you know, the ag economy is going through a bit
of a slump, rivaled only by the farm crisis that we had in the
1980s. While we know that, on average, farm balance sheets are
stronger than they were in the '80s, decreasing land prices can
change that in a hurry.
I am especially concerned for some of the younger and
smaller farmers who got their start in the past decade,
veterans and other beginning farmers who have only known those
good times of high commodity prices and they have not had a
chance to pay off debt and build equity. I hear that all the
time when I am out on my 99-county tour, as you would know, Mr.
Smith.
So I would like to start with you, Mr. Smith. If you are
confirmed to the FCA Board, what do you believe must be done to
ensure that young and beginning farmers are receiving the
support they need to avoid going under?
Mr. Smith. It is a frequent question that I have gotten in
just about every Senate office that we have visited is how do
we get young farmers involved, and as a lender, how do we stay
secure and reliable and help mitigate that risk.
One of the things I referred to a little earlier, and would
refer to again, is partnerships with entities that are
encouraging beginning farmers, FSA, for instance, that minimize
capital requirements, that have lower interest rates, are ways
of possibly Farm Credit partnering with other entities to make
those loans and try to mitigate the risk at the same time.
As you know, Iowa has been a very--has got some very good
programs for beginning farmers, offering subsidies to owners
that cooperate with renting land to beginning farmers, and also
selling land to beginning farmers, if it is sold on a contract,
anyway.
So I think from the standpoint of Farm Credit, I think my
role would be encouraging using additional programs to help
mitigate risk, to help that risk with lower interest rates. But
one thing, Senator Ernst, that does scare me--and again, not to
be repetitive, but it is the high cost of capital--the land,
the breeding livestock, the machinery, that does worry me, that
we did not have in the '80s. You know, $30,000 financed, really
my beginning machinery package to farm 500 acres. Today, you
can ask my son because that is his department, but I think it
barely financed our GPS equipment.
Senator Ernst. Right.
Mr. Smith. So a huge disparity in the amount of capital
that is required today, and those beginning--just because you
say yes to that loan does not mean it might be good for that
young borrower. Diversification--and we talked in Senator
Stabenow's office a lot about this--is diversification, small
loans, getting people started in a small way I think should be
encouraged, maybe is one answer to help mitigate that risk.
Making $10,000 loans, 20, $15,000 loans, and getting people
started maybe is better than that big loan that may be more
efficient, but again, is it really serving the needs of those
young farmers?
Senator Ernst. That is a really great point, and in your
testimony, you mentioned the economic prosperity of farming
communities in 2006 to 2013, that time frame, and the spending
habits it led to that may no longer be supportable. How
concerned are you that too many farmers are over-leveraged if
interest rates continue to rise?
Mr. Smith. Very concerned. Very concerned. Even a minimal
two-point rise in interest rates would significantly impact
operating budgets, again, getting back to the high cost of
capital that we are working with today.
Again, getting back to the diversification part, back in my
parents' generation, pigs, cattle, chickens--that was diversity
on farms even I grew up with. Today I say an intelligent,
working wife is the best diversification, hopefully with
insurance benefits, right?
But the point being--and you can ask Fauzan and I, and I
know you have, because we lived with that, is taking care of
those family living expenses and not having to serve those in
addition to paying your loan obligations.
So a lot of counseling. I think the opportunity in Farm
Credit with beginning farmers would be a lot of counseling on
different ideas to survive, not just making the loan.
Senator Ernst. I appreciate that, and I do think that is
essential, the counseling aspect of that. We were laughing
about having a spouse that maybe works outside of the home, but
that is truly how many of our farm families are able to
survive, especially with the crisis that we are seeing with
health insurance right now, especially in Iowa.
Mr. Smith. Yes.
Senator Ernst. So thank you, Mr. Smith, so much, for your
time. Thank you, Mr. Vaden, for being here as well.
Thank you, Mr. Chair.
Senator Boozman. Thank you, and next is a former House
colleague of mine, Senator Van Hollen.
Senator Van Hollen. Thank you. Thank you, Mr. Chairman.
Thank you and the Ranking Member, and welcome, Mr. Smith and
Mr. Vaden.
Mr. Vaden, I do want to follow up on some of the concerns
that have been raised by Senator Stabenow and Senator Brown
regarding your representation in some of these voting rights
cases, because I think compared to many of your predecessors in
this position, as General Counsel, who had experience in the
agricultural law or natural resources area, you have not had
that experience in that area. You have had, and done a lot of
work in these voting rights cases.
So my first question is, when it came to the North Carolina
case, I know the Judicial Education Project was a party. Did
they pay Jones Day in full for that, or was it taken on in part
as a part--a discounted rate? Do you know whether or not they
paid the firm in full?
Mr. Vaden. Senator, as I mentioned in response to my
question--to the question from Senator Brown, as an associate I
did not have access, nor did I participate in the billing
function of the firm. So that was solely with partners, so I do
not know the rate they were charged and I do not know their
payment status and am unable to comment.
Senator Van Hollen. Okay. Now, so, you and I share the
experience of having been associates in a law firm. Jones Day,
of course, is a big law firm. It was my experience that in a
case like these, that if an associate indicated that they did
not want to participate, the firm would certainly defer to
those associate wishes. Did you express any concern or--about
participating in these cases to your partners at Jones Day?
Mr. Vaden. Senator, my ethical responsibility as a lawyer
is to represent every client with ethical propriety and
zealousness.
Senator Van Hollen. That was--Mr. Vaden, that is not my
question. The firm--these were clients of the firm. The first
has--like Jones Day has hundreds of associates. It happens that
you were involved in cases on behalf of the Judicial Education
Project in North Carolina, Ohio, and Virginia. Is that correct?
Mr. Vaden. That is correct, Senator.
Senator Van Hollen. So you, at no time, expressed to the
partners the fact that you did not want to participate in these
cases, I assume. Right?
Mr. Vaden. I did not, just as I did not, Senator, express
displeasure about representing multiple labor union to protect
the rights of their members or any of the other cases for which
I was----
Senator Van Hollen. Are you familiar with the Judicial
Crisis Project?
Mr. Vaden. I am aware of the name but I cannot claim to be
familiar with it.
Senator Van Hollen. Okay. So you have had no kind of
affiliation or participation in any way with that group.
Mr. Vaden. The Judicial Crisis Project?
Senator Van Hollen. Yes.
Mr. Vaden. No, sir. I do not believe I have.
Senator Van Hollen. So in the North Carolina case--and you
mentioned a number of cases where you had, for example,
defended clients' due process rights against the government--
Mr. Vaden. Yes.
Senator Van Hollen. --and I think that is a worthy thing.
Now, of course, in the case of North Carolina, you were on the
opposite side, right? You were defending the State of North
Carolina and the Education Project as an amicus--amicus
filing--against claims from the defendants that their due
process rights had been violated. Right?
Mr. Vaden. The job of an amicus is to make a legal point.
Senator Van Hollen. I know. I know what the job of amicus
is. I have got your amicus brief here. The North Carolina--the
U.S. Court of Appeals in this case, in North Carolina, found,
and I quote, ``The General Assembly enacted legislation that
restricted voting and registration in five ways, all of which
disproportionately affected African Americans.'' They went on
to say, ``We can only conclude that the North Carolina General
Assembly enacted the challenge provisions of the law with
discriminatory intent.''
You all wrote in your brief that ``North Carolina allows
all its citizens to vote, although members of minority races
may disproportionately choose, for socioeconomic or other
reasons, not to take advantage of this equal opportunity. North
Carolina's practices are not the proximate cause of this
phenomenon.''
Now clearly the court, both the District Court and the
Court of Appeals concluded very differently. My question to you
is, now, stepping back, given the full scope of this case,
having now heard all the arguments and seen the decisions from
the Circuit Court, do you agree with the finding of the Court
of Appeals, that, in fact, the North Carolina law was
discriminatory?
Mr. Vaden. Senator, the ruling of the court is the final
decision of the court, and that is what the law--that is what
they----
Senator Van Hollen. Mr. Vaden, I understand what the law
is. The law of the land is citizens united. I disagree with the
decision. I am asking you whether, in the full light of being
able to look back, whether you agree with the finding of the
Circuit Court, that the North Carolina law was discriminatory?
Mr. Vaden. I respect the ruling of the court.
Senator Van Hollen. So you choose not to answer that direct
question.
Mr. Vaden. Senator, I have a duty of fidelity to former
clients, under Rule of Professional Conduct 1.6. I also have a
duty to respect the final ruling of each and every court in
which I am involved in litigation. I take both responsibilities
very seriously.
Senator Van Hollen. Thank you. Thank you, Mr. Chairman.
Senator Boozman. Thank you, Senator. Our Senator from
Michigan.
Senator Stabenow. Thank you, Mr. Chairman. I welcome our
guests again and I have completed my questions. Thank you.
Senator Boozman. Thank you so much. That will conclude our
hearing today. I thank the nominees for their thoughtful
comments and their engagement with the members of this
Committee. I also thank all of you for your willingness to
advocate for American farmers and ranchers as USDA and Farm
Credit.
The answers you provide today will be considered as we move
to approve your nominations in the near future. To that end, I
would request that if my fellow members have any additional
questions for the record that they may be submitted to the
Committee Clerk by 2:00 p.m. Monday, November 13th. We look
forward to receiving your responses in a timely fashion and to
further consider your nominations.
The Committee will be adjourned.
[Whereupon, at 10:41 a.m., the Committee was adjourned.]
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DOCUMENTS SUBMITTED FOR THE RECORD
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QUESTIONS AND ANSWERS
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