[Congressional Record Volume 143, Number 105 (Wednesday, July 23, 1997)]
[Senate]
[Pages S7898-S7911]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND
RELATED AGENCIES APPROPRIATIONS ACT, 1998
The Senate continued with the consideration of the bill.
Mr. COCHRAN addressed the Chair.
The PRESIDING OFFICER. The Senator from Mississippi is recognized.
Amendment No. 962
(Purpose: To make technical corrections to the bill)
Mr. COCHRAN. Mr. President, I send an amendment to the desk.
The PRESIDING OFFICER. The clerk will report.
The assistant clerk read as follows:
The Senator from Mississippi [Mr. Cochran], for himself and
Mr. Bumpers, proposes an amendment numbered 962.
Mr. COCHRAN. Mr. President, I ask unanimous consent that reading of
the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
On page 55, line 20, strike ``1997'' and insert ``1998''.
On page 55, line 21, strike ``1997'' and insert ``1998''.
Mr. COCHRAN. Mr. President, this is a technical amendment offered for
myself and in behalf of the Senator from Arkansas [Mr. Bumpers]. It has
been cleared on both sides of the aisle.
I ask that it be approved by the Senate.
The PRESIDING OFFICER. Is there further debate on the amendment?
If not, the question is on agreeing to the amendment of the Senator
from Mississippi.
The amendment (No. 962) was agreed to.
Mr. COCHRAN. Mr. President, I move to reconsider the vote by which
the amendment was agreed to.
Mr. BUMPERS. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
Amendment No. 963
(Purpose: To make an amendment relating to rural housing programs)
Mr. COCHRAN. Mr. President, I send an amendment to the desk on behalf
of Senators D'Amato and Sarbanes.
The PRESIDING OFFICER. The clerk will report.
The assistant clerk read as follows:
The Senator from Mississippi [Mr. Cochran], for Mr.
D'Amato, for himself and Mr. Sarbanes, proposes an amendment
numbered 963.
Mr. COCHRAN. Mr. President, I ask unanimous consent that reading of
the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
At the appropriate place in the bill, insert the following:
SEC. . RURAL HOUSING PROGRAMS.
(a) Housing in Underserved Areas Program.--The first
sentence of section 509(f)(4)(A) of the Housing Act of 1949
(42 U.S.C. 1479(f)(4)(A)) is amended by striking ``fiscal
year 1997'' and inserting ``fiscal year 1998''.
(b) Housing and Related Facilities for Elderly Persons and
Families and Other Low-Income Persons and Families.--
(1) Authority to make loans.--Section 515(b)(4) of the
Housing Act of 1949 (42 U.S.C. 1485(b)(4)) is amended by
striking ``September 30, 1997'' and inserting ``September 30,
1998''.
(2) Set-aside for nonprofit entities.--The first sentence
of section 515(w)(1) of the Housing Act of 1949 (42 U.S.C.
1485(w)(1)) is amended by striking ``fiscal year 1997'' and
inserting ``fiscal year 1998''.
(3) Loan term.--Section 515 of the Housing Act of 1949 (42
U.S.C. 1485) is amended--
(A) in subsection (a)(2), by striking ``up to fifty'' and
inserting ``up to 30''; and
(B) in subsection (b)--
(i) by striking paragraph (2) and inserting the following:
``(2) such a loan may be made for a period of up to 30
years from the making of the loan, but the Secretary may
provide for periodic payments based on an amortization
schedule of 50 years with a final payment of the balance due
at the end of the term of the loan;'';
(ii) in paragraph (5), by striking ``and'' at the end;
(iii) in paragraph (6), by striking the period at the end
and inserting ``; and ''; and
(iv) by adding at the end the following:
``(7) the Secretary may make a new loan to the current
borrower to finance the final payment of the original loan
for an additional period not to exceed twenty years, if--
``(A) the Secretary determines--
``(i) it is more cost-effective and serves the tenant base
more effectively to maintain current property than to build a
new property in the same location; or
``(ii) the property has been maintained to such an extent
that it warrants retention in the current portfolio because
it can be expected to continue providing decent, safe, and
affordable rental units for the balance of the loan; and
``(B) the Secretary determines--
``(i) current market studies show that a need for low-
income rural rental housing still exists for that area; and
``(ii) any other criteria established by the Secretary has
been met.''.
(c) Loan Guarantees for Multifamily Rental Housing in Rural
Areas.--Section 538 of the Housing Act of 1949 (42 U.S.C.
1490p-2) is amended--
(1) in subsection (q), by striking paragraph (2) and
inserting the following:
``(2) Annual limitation on amount of loan guarantee.--In
each fiscal year, the Secretary may enter into commitments to
guarantee loans under this section only to the extent that
the costs of the guarantees entered into in such fiscal year
do not exceed such amounts as may be provided in
appropriation Acts for such fiscal year.'';
(2) by striking subsection (t) and inserting the following:
``(t) Authorization of Appropriations.--There are
authorized to be appropriated for fiscal year 1998 for costs
(as such term is defined in section 502 of the Congressional
Budget Act of 1974) of loan guarantees made under this
section such sums as may be necessary for such fiscal
year.''; and
Mr. D'AMATO. Mr. President, I rise to support the amendment relating
to Department of Agriculture rural housing programs. I would like to
express my appreciation to Chairman Cochran and Ranking Minority Member
Bumpers for their consideration of this amendment and their continued
commitment to providing affordable housing for our Nation's rural
Americans.
The Department of Agriculture has a number of successful housing
programs under the auspices of its Rural Housing Service [RHS].
Although operated by the Department of Agriculture, rural housing
programs are under the jurisdiction of the Banking Committee. As
chairman of the Banking Committee, I respectfully request the
consideration of this much needed amendment.
This amendment contains provisions which will permit important
housing programs to continue in an uninterrupted and cost-efficient
fashion. It includes 1-year extensions of housing programs which have
expired or will expire in the near future. Specifically, the RHS
Section 515 Rural Rental Housing Program, the RHS Section 538 Rural
Rental Housing Loan Guarantee Program, and the RHS Underserved Areas
Program would be extended until September 30, 1998.
Due to the uncertainty of final passage of housing reauthorization
legislation this year, these short-term extensions are essential. In
addition, the amendment would alter the section 515 loan term and
amortization schedule. This provision would change the loan term from
50 to 30 years, but allow the borrower to have the loan amortized for a
period not to exceed 50 years. This statutory change incurs no cost to
the American taxpayer, and is necessary to ensure that budget authority
provided will support the administration's proposed fiscal year 1998
section 515 program level.
The need for affordable housing in rural areas is severe. According
to the 1990 census, over 2.7 million rural Americans live in
substandard housing. In my home State of New York, 76 percent of
renters are paying 30 percent or more of their income for housing.
Approximately 60 percent of New York renters pay over 50 percent of
their income for rent.
The section 515 and section 538 programs are some of the few
resources available to respond to this serious unmet housing need.
Since its inception in 1962, the section 515 rental loan program has
financed the development of over 450,000 units of affordable units in
over 18,000 apartment projects. The program assists elderly, disabled,
and low-income rural families with an average income of $7,200. The
alteration of the section 515 loan term and amortization schedule will
provide over 500 additional units. The section 538 program is a
relatively young loan guarantee program which has already proven to
have widespread national appeal. With a proposed subsidy rate of
approximately 3 cents per $1, it is an example of cost-effective
leveraging of public resources.
I thank the Appropriations Committee for its recognition of the great
need for these important rural housing programs and its steadfast
commitment to
[[Page S7899]]
ensuring that every Federal dollar appropriated serves the greatest
number of our low-income rural Americans. I support immediate passage
of this amendment. Thank you.
Mr. SARBANES. Mr. President, I rise today in support of an amendment
concerning rural housing reauthorizations for the Rural Housing Service
of the Department of Agriculture. I want to commend Chairman Cochran
and Ranking Member Bumpers for their tireless efforts and cooperation
in bringing the Agriculture Appropriations Act of 1998 to the floor for
Senate consideration.
Given the uncertainty of housing reauthorization legislation this
year, I have joined with Banking Committee Chairman D'Amato to request
the inclusion of an amendment that would reauthorize several rural
housing programs in the 1998 Agriculture appropriations bill. This
amendment will allow the section 515 and section 538 rural rental
housing programs to continue providing multifamily housing developers
with direct loans and loan guarantees to build or rehabilitate
affordable rental housing.
In addition, this amendment reauthorizes for 1 year the nonprofit
set-aside which reserves 10 percent of section 515 funds for nonprofit
applicants, as well as the Underserved Areas Program which targets
funds to the 100 most underserved rural communities. This amendment
also changes the section 515 loan term from 50 to 30 years, while
allowing the loan to be amortized over a 50-year period. This change
permits the administration's proposed program level in the budget of
$150 million to be supported by almost 15 percent less in budget
authority.
Without these housing programs targeted to very-low and low-income
rural residents, there exists few resources in rural America to help
alleviate the shortage of affordable rental housing. Rural areas still
lack adequate access to commercial credit to finance affordable
multifamily housing. The direct benefits to rural communities from the
section 515 and section 538 programs includes increased jobs and local
taxes in addition to attracting and maintaining businesses. This is a
direct and vital link to the overall health and stability for rural
communities.
While the Rural Housing Service has done much to bring decent, safe,
and affordable housing to rural America, many rural families are still
in need of assistance. Rural renters experience housing problems such
as overcrowding, cost overburdens, and substandard facilities. There
are 1.6 million rural households that live in housing without adequate
plumbing, heating, or kitchen facilities. Nearly 2.5 million are paying
more than 50 percent of their incomes for housing costs, and another 3
million pay between 30 and 50 percent. As we encourage families to move
from welfare to work, it is even more essential that we build on the
vital housing programs that provide the safety net which will give the
working poor an opportunity to live in affordable, decent housing.
Again, I would like to thank Chairman Cochran, Ranking Member
Bumpers, and the rest of my colleagues for their swift action to ensure
that essential rural rental housing programs receive authorization to
continue serving low-income families for another year. I urge the
adoption of this amendment.
Mr. COCHRAN. Mr. President, I know of no objection to this amendment.
It has been cleared. We recommend that it be approved.
The PRESIDING OFFICER. Is there further debate on the amendment? If
not, the question is on agreeing to the amendment of the Senator from
New York.
The amendment (No. 963) was agreed to.
Mr. COCHRAN. Mr. President, I move to reconsider the vote by which
the amendment was agreed to.
Mr. BUMPERS. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
Mr. COCHRAN. Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The bill clerk proceeded to call the roll.
Mr. ROBERTS. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER (Mr. Allard). Without objection, it is so
ordered.
Amendment No. 961
(Purpose: To withhold $4,000,000 of appropriated funds from the Risk
Management Agency until the administrator of the agency issues and
begins to implement a plan to reduce administrative and operating costs
of approved insurance providers)
Mr. ROBERTS. Mr. President, I have an amendment numbered 961 and I
ask for its immediate consideration.
The PRESIDING OFFICER. The clerk will report the amendment.
The bill clerk read as follows:
The Senator from Kansas [Mr. Roberts] proposes an amendment
numbered 961.
Mr. ROBERTS. Mr. President, I ask unanimous consent that reading of
the amendment be dispensed with.
The amendment is as follows:
On page 28, line 19, before the period at the end of the
sentence, insert the following: ``: Provided further, That,
of the amount made available under this sentence, $4,000,000
shall be available for obligation only after the
Administrator of the Risk Management Agency issues and begins
to implement the plan to reduce administrative and operating
costs of approved insurance providers required under section
408(k)(7) of the Federal Crop Insurance Act (7 U.S.C.
1508(k)(7))''.
Mr. ROBERTS. Mr. President, prior to discussing the amendment, I want
to take this opportunity to associate myself with the most pertinent
remarks stated by the distinguished Senator from Mississippi, the
chairman of the Agriculture Appropriations Subcommittee, and the
distinguished ranking member, the Senator from Arkansas. Chairman
Cochran and the ranking member, Senator Bumpers, have demonstrated
continued leadership and tireless efforts to make it possible for the
American farmer and rancher to continue to feed this country and a
troubled and hungry world.
Senator Cochran said in his earlier remarks that all have
contributed. I would also like to extend my congratulations to the
staff, both of Mr. Cochran and to Mr. Bumpers, and I would point out to
the American consumer, all taxpayers as well as our farmers and
ranchers about what is at stake here. It is just not the eighth or
ninth appropriations bill we are considering in this Chamber, albeit
that is important. We are talking about the fact that the American
consumer today spends only 10 cents of the disposable income dollar for
that so-called market basket of food.
Every housewife in America should pay attention to the fact that that
frees up 90 cents for hard-pressed families today to spend on education
or housing or the other essentials. And so we want to say thank you to
Senator Cochran and Senator Bumpers for providing the funds to continue
this vital responsibility of feeding America.
Senator Bumpers mentioned food safety. Now, we have heard a great
outcry in regard to E. coli, salmonella, and other challenges we face,
but as Senator Bumpers pointed out we have, hopefully, adequate funds
to address that problem. So this bill deals with food safety. And I
might point out that since we have the best quality of food at the
lowest price, the American consumer today apparently cares more about
convenience and the safety of their food supply rather than price. That
is unequaled in regard to any country. And so this bill does address
that.
I could go on about the trade aspects of the bill and our balance of
payments and jobs. I could point out we all live longer as a result of
the efforts of agriculture and farmers and ranchers and the investment
we are making in this bill. Simply put, we do have the best quality
food at the lowest price in the history of the world, and I think a lot
of people do take agriculture for granted. The first obligation of any
government is to provide its country an adequate food supply. Who is
responsible for this? Many are, but two particular individuals, one the
chairman of the committee and the other the ranking member. And I again
wish to thank them.
As a matter of fact, I can recall several months ago that the
chairman of the subcommittee, Senator Cochran, and I were privileged to
join Senator Stevens on a trip to the Russian Far East and to South
Korea and to North Korea. We were the first congressional delegation
allowed into North Korea. And in North Korea, the former leader of that
country, if I can refer to that person as a leader, Kim Il-song, called
[[Page S7900]]
the ``Magnificent Leader,'' by the way, has written a veritable tome of
books about that kind of government. It is a very repressive and
totalitarian government. But the first book--and I read it the evening
we were there--starts out with agriculture and says the first
obligation of any country is to be able to feed its people.
So while we were there we were working on the four-party peace talks,
and we were trying to be a positive influence, and Senator Cochran has
a great deal of expertise in regard to disarmament. He had this other
idea; he insisted in regard to Senator Stevens, myself and others, we
visit this collective farm. And the Senator made a good point. We went
out and we visited it outside the capital city of Pyongyang, and we
found a farm that had farming practices back in the 1930's, largely
responsible, I might add, for the famine in that country.
I really think, if you stop to take a look at it, we ought to count
our blessings in the fact we have outstanding individuals in the Senate
such as Senator Bumpers and Senator Cochran responsible for the
investment in American agriculture to allow us to do the things we do.
I have been through what, five or six farm bills, having had the
privilege of serving in the other body. Those are the authorizing
committees. I also wish to thank Senator Cochran in particular for the
way that he has handled the obligations and responsibilities of the
appropriators. It is a difficult task to try to fit together our
spending priorities with the policy objectives of the authorizers, and
I must say in all candor, unlike the other body, Senator Cochran has
closely cooperated with the authorizing committee, has done so with
fairness, with tolerance and with respect and comity and also
understanding and effective leadership. I think we have quite a team on
the appropriations subcommittee involving agriculture appropriations,
and I again wish to thank them. I thank Senator Bumpers and Senator
Cochran on behalf of every farmer, every rancher, and every consumer in
America. I think they have done an outstanding job.
Mr. President, I regret that I must offer this amendment. Quite
honestly, it pains me to have to even suggest this course of action,
but my responsibility to the farmers of America certainly compels me to
do so. The purpose of this amendment is twofold. First, it allows this
body to recognize that the Risk Management Agency--that is the outfit
that administers the USDA's Federal Crop Insurance program--has failed
to comply with the Federal Crop Insurance Act of 1994. That is 3 years
ago.
Second, as a result of the Risk Management Agency's unwillingness to
submit and implement a plan to reduce administrative and operating
costs of approved insurance providers as required under the 1994 act,
this amendment would withhold--I am not trying to cut, just withhold--
funding of $4 million of funding from the RMA appropriation unless the
plan is implemented by September 30, 1998.
Mr. President, farmers have always needed crop insurance in order to
make ends meet, in order to work, but for too many years it was always
either too expensive or provided too little coverage depending on what
region you came from and what commodity. But we passed the 1994 Crop
Insurance Act and privately developed crop insurance products surfaced
as a replacement, very long needed replacement, to the old USDA-
sponsored insurance programs. Now, while crop revenue coverage, or what
we call CRC, is widely regarded as a revolutionary new risk management
tool in farm country, we are providing farmers the capability, the
tools, if you will, to manage their downside risk when prices fall. It
is not like the old insurance products. The CRC protects both against
price and yield risk. It is expensive, that is true, but it is worth
the price for farmers who want adequate protection for their farm and
their family. But, unfortunately, too often the USDA has taken an
adversarial position to the development of these private crop insurance
programs.
Too often the department has tried to compete with the private sector
in the development and marketing of these products.
A few weeks ago, a crop insurance agent from Luray, KS, population
about 500, came into my office and said: ``Senator Roberts, I really
want to continue selling crop insurance because I know the farmers in
our community need it, that our town depends on the farm economy for
its survival. But, Senator, all the paperwork and redtape involved has
forced me to hire additional people just to push the paper around.
Unless the regulatory burden subsides, I am afraid I will have to stop
selling crop insurance entirely.''
This amendment is all about that crop insurance agent and small town
America. This amendment is all about the farmer, who tries to feed this
very troubled and hungry world, who will invariably face higher crop
insurance premiums as a result of USDA's intransigence. We cannot let
this unfortunate situation threaten the viability of our crop insurance
program and our farmers, the exciting new tools for the farmers to
manage their downside risk.
I urge support for this amendment. I simply ask the risk management
agency to do what the Congress and the President required of them back
in 1994. We made that arrangement. We lowered the payments that went to
the crop insurance companies in exchange for regulatory reform.
I don't know how many times I have asked the RMA folks, officials
down there, where is the report? In 1994, no report; 1995, no report;
1996 no report; 1997--it's time. This is going to give them clear up to
September 30, 1998. But this ought to at least open some eyes down at
USDA that we need regulatory reform. That's what we asked for, that's
what we required in the 1994 act. I ask consideration of the amendment.
The PRESIDING OFFICER. The Senator from Mississippi.
Mr. COCHRAN. Mr. President, we have looked at the amendment proposed
by the distinguished Senator from Kansas. I must say, it is targeted to
a very narrow issue, and it seeks to withhold only $4 million of a $64
million account which is appropriated or recommended for appropriation
in this bill for the administration of the Risk Management Agency that
has a responsibility for administering the crop insurance program.
I am not going to oppose this amendment. I sympathize with the goal.
I sympathize with the effort to get the attention of the administration
to do something that was required of them in the 1994 act of Congress.
I am hopeful the Senate will approve the amendment and that this will
help achieve the goal of the distinguished Senator from Kansas.
Let me also say, too, I am very grateful for his generous comments
about the work of our subcommittee and the efforts we have made to
present a bill that reflects the needs of our country in connection
with agriculture and agricultural production and all of those other
activities that are funded in the legislation. He is very kind to point
out that we have worked hard. He has been a big help, too, in certainly
helping us understand the provisions that were contained in the last
passed farm bill, which he had a great deal to do with writing as
chairman of the House Agriculture Committee. We are lucky to have him
in the Senate, and we appreciate his continued advice and counsel and
assistance in these matters.
The PRESIDING OFFICER. The Senator from Arkansas.
Mr. BUMPERS. Mr. President, let me echo the comments of the
distinguished Senator from Mississippi, Chairman Cochran. I subscribe
to everything he said. I also want to especially thank the
distinguished Senator from Kansas for his very, very kind, laudatory
comments.
Having said that, let me just say I am not going to object to the
amendment either. I think, in a way, it is a little bit of a
sledgehammer approach. But, by the same token, the Senator is entitled
to the report he requested a very long time ago. It is a legitimate
request, and the Department should have responded to it much sooner.
The Department objects to the amendment, but I am going to, on behalf
of this side of the aisle, say I will accept the amendment and I
strongly encourage the Department to respond, so, possibly by the time
we get to conference, we can deal with this amendment. But let the
Department know in advance that unless there is a very firm commitment
made, the Senator's
[[Page S7901]]
request will be honored and the amendment will wind up in the
conference committee report.
So, I am going to clear this amendment for this side of the aisle.
The PRESIDING OFFICER. If there be no further debate, the question is
on agreeing to the amendment.
The amendment (No. 961) was agreed to.
Mr. BUMPERS. Mr. President, I move to reconsider the vote.
Mr. COCHRAN. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
The PRESIDING OFFICER. The Senator from Mississippi.
Mr. COCHRAN. Mr. President, I understand that Senators are
considering offering amendments. Let me say this is a good time to come
to the floor and do that. We expect amendments to be offered. We hope
to wind up consideration of all amendments so we can stack votes and
have those votes at 4 o'clock this afternoon, and then final passage of
the bill. To do that, we need the cooperation and participation of
Senators. We invite that at this time.
Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The bill clerk proceeded to call the roll.
Mr. BURNS. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BURNS. Mr. President, I also ask unanimous consent that I may
proceed as in morning business for no more than 2 minutes for the
purpose of introducing a bill.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BURNS. I thank the Chair.
(The remarks of Mr. Burns pertaining to the introduction of S. 1056
are located in today's Record under ``Statements on Introduced Bills
and Joint Resolutions.'')
Mr. BURNS. Mr. President, I yield back any time remaining. I thank
the chairman of the ag appropriations bill for his courtesy.
Mr. COCHRAN addressed the Chair.
The PRESIDING OFFICER. The Senator from Mississippi.
Amendment No. 964
(Purpose: To modify the conditions for issuance of cotton user
marketing certificates)
Mr. COCHRAN. Mr. President, I send an amendment to the desk which has
been cleared.
The PRESIDING OFFICER. The clerk will report the amendment.
The bill clerk read as follows:
The Senator from Mississippi [Mr. Cochran], for himself and
Mr. Bumpers, proposes an amendment numbered 964.
Mr. COCHRAN. Mr. President, I ask unanimous consent that the reading
of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
At the end of the bill, add the following new provision:
Sec. . Effective on October 1, 1998 section 136(a) of the
Agricultural Market Transition Act (7 U.S.C. 7236(a)) is
amended--
(a) in paragraph (1)
(1) by striking ``Subject to paragraph (4), during'' and
inserting ``During''; and
(2) in subparagraph (B), by striking ``130'' and inserting
``134'';
(b) by striking paragraph (4); and
(c) by redesignating paragraph (5) as paragraph (4).
Mr. COCHRAN. Mr. President, I am pleased to offer this amendment on
behalf of myself and Senator Bumpers. This amendment contains two
technical changes to the competitiveness provisions of the domestic
cotton program. This amendment has been scored by the Congressional
Budget Office as having no cost. I am informed that the chairman of the
Senate Agriculture Committee has no objection to the amendment.
The original provisions in the law were designed to ensure that U.S.
cotton is competitive in both domestic and overseas markets. The
program has worked well, but changes made to the program in 1991 and
1996 have had unintended consequences.
The amendment I am offering would address those problems by doing two
things. First, it makes it possible for the various components of the
program to work simultaneously to ensure that we do not rely too much
on cotton import quotas to make domestic cotton competitive. Second, it
slightly increases a ceiling that unduly restricts the availability of
the step 2 certificate program. By capping loan rates in the 1996 FAIR
Act, Congress unintentionally restricted the operation of the cotton
competitiveness program. The amendment eases the restriction slightly,
but would not affect loan rates.
Mr. President, this is an amendment that has been cleared on both
sides of the aisle. I know of no objections to it. I know of no
Senators who want to speak on the amendment.
The PRESIDING OFFICER. Is there further debate? If not, the question
is on agreeing to the amendment.
The amendment (No. 964) was agreed to.
Mr. COCHRAN. Mr. President, I move to reconsider the vote by which
the amendment was agreed to, and I move to lay that motion on the
table.
The motion to lay on the table was agreed to.
arkansas communications project
Mr. BUMPERS. Mr. President, I would like to engage the senior Senator
from Mississippi in a colloquy.
Mr. COCHRAN. I would be pleased to join the senior Senator from
Arkansas in a colloquy.
Mr. BUMPERS. Mr. President, this bill includes the Rural Community
Advancement Program which provides flexibility to tailor financial
assistance to applicant needs. Through this program rural business
enterprise grants are made available.
As you are very well aware, I have pursued funding for the Arkansas
communications project since March 1992. This project will provide a
statewide communications and education network that will eventually
include all Arkansas publicly funded 2- and 4-year institutions of
higher learning, research and extension centers, cooperative extension
county offices, many rural hospitals, and State and Federal Government
office buildings. The network will include compressed video, TV/video
production, and data networking. When completed, the project will serve
the large rural population of Arkansas as well as provide linkages and
educational support to our more urban areas.
This committee first voiced its support for the project in the fiscal
year 1993, and the committee has continued to note its support every
year since. Unfortunately, the University of Arkansas Divisions of
Agriculture, which is sponsoring this project, has endured mixed
results in getting the Department of Agriculture to honor the wishes of
this committee. Promises were made and broken until the project came to
the attention of Under Secretary Thompson and her staff in Rural
Development. She and they have offered invaluable assistance, and I am
pleased to note that the division received funding for the first phase
of the project earlier this year and is actively seeking funding for
the second and third phases. I should also note that the division has
already committed sizeable non-federal resources to the project while
reducing the total cost by nearly one-third. Am I correct in noting
that the committee still strongly supports completion of this project?
Mr. COCHRAN, The ranking member is correct.
Mr. BUMPERS. And am I correct in noting that the committee will
continue to actively monitor the progress of the Department toward
fully funding the Arkansas communications project in a timely manner?
Mr. COCHRAN. The ranking member is again correct. The committee notes
its strong approval of the Department for actively working to fund this
important project from existing resources. The committee reserves the
right to revisit this project next year should the Department fail to
continue its laudable efforts.
Mr. BUMPERS. I thank the Chairman. Let me also note that the
Department of Agriculture offered to assist the division in seeking
communication funds from other Departments as well. The division
recently submitted a grant request to the Department of Commerce and it
is my expectation that the Department of Agriculture will follow
through with their offer of assistance and support.
In addition to the Arkansas communications project, the Arkansas
Enterprise Group has been trying to provide assistance for rural
communities and smaller companies in Arkansas so that
[[Page S7902]]
they can join the increasingly global and international environment.
However, the small companies which the Arkansas Enterprise Group is
trying to help grow do not meet the criteria required to move unaided
into the export market. They also fall between the cracks for other
programs that aid companies to export products. Am I correct in noting
that the committee supports the Arkansas Enterprise Group in their
business international exporting loan fund?
Mr. COCHRAN. The ranking member is correct.
Mr. BUMPERS. Is it also the Senator from Mississippi's understanding
that if State allocations are not sufficient to meet any States needs
that a national reserve is available.
Mr. COCHRAN. The ranking member is correct.
Mr. BUMPERS. I thank the Chairman.
Mr. DURBIN addressed the Chair.
The PRESIDING OFFICER. The Senator from Illinois.
Amendment No. 965
(Purpose: To prohibit the use of appropriated funds to provide or pay
the salaries of personnel who provide crop insurance or noninsured crop
disaster assistance for tobacco for the 1998 or later crop years)
Mr. DURBIN. Mr. President, I send an amendment to the desk.
The PRESIDING OFFICER. The clerk will report the amendment.
The bill clerk read as follows:
The Senator from Illinois [Mr. Durbin], for himself, Mr.
Gregg, and Mr. Wyden, proposes an amendment numbered 965.
Mr. DURBIN. Mr. President, I ask unanimous consent that the reading
of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
On page 66, between lines 12 and 13, insert the following:
Sec. 728. None of the funds made available in this Act may
be used to provide or pay the salaries of personnel who
provide crop insurance or noninsured crop disaster assistance
for tobacco for the 1998 or later crop years.
Mr. DURBIN. Thank you, Mr. President.
Mr. President, one of the most common questions asked of Members of
the House and Senate at town meetings or in casual conversations across
America is the following: ``Senator, if the Federal Government tells us
that tobacco is so dangerous for Americans, why does the Federal
Government continue to subsidize tobacco in America?
A variety of answers are given to that question. These answers
reflect, in some ways, our wishes and, in some ways, misinformation,
but the honest answer is, there is no answer. It is almost impossible
to explain to America's taxpayers why we are subsidizing the growth of
a product which we tell every American is dangerous when consumed.
How did we get in this predicament where we are subsidizing the
growth and cultivation of tobacco in America? I would like to give a
little history.
In the midst of the Great Depression in 1933, Congress responded to
the plight of farmers facing declining prices by passing the
Agricultural Adjustment Act of 1933. This was part of the New Deal
legislation. When that legislation did not help halt the devastation
spreading throughout the vast rural areas of our Nation, Congress in
1938 passed the Agricultural Adjustment Act of 1938, and in that act,
tobacco price support programs were born. The legislation also created
farm programs for a wide variety of other crops.
Over the years since then, we have changed and, in effect, totally
overturned those supply control programs for almost every crop. Only a
few crops continue to enjoy a program that looks like the 1938 bill.
One of those select crops is tobacco.
The Agricultural Adjustment Act of 1938 also created the Federal Crop
Insurance Corp. By 1945, tobacco and a number of other program crops
enjoyed Federal crop insurance to protect farmers from unexpected crop
losses. The Crop Insurance Program has gone through many changes over
the years. The modern version of the program began in 1981, with a
major reorganization, which I was part of, in 1994.
This year, for a farmer who has a typical crop insurance policy
covering up to 65 percent of the crop's anticipated revenue, the
Federal Government, the taxpayers, will pay 41.7 percent of the total
premium. That is the direct subsidy to the Crop Insurance Program. In
addition, the administration of the program is subsidized.
Finally, if losses exceed what is anticipated, the Federal Government
is, in fact, the insurance company of last resort, paying, for most
crops, the difference. This subsidy may make sense for many crops. It
helps bring some stability to the production of food and fiber that
Americans rely on. But this is the most important element.
Tobacco is not like any other crop in America. Tobacco is neither
food nor fiber. Tobacco is the only crop grown in America with a body
count. It is time we consider the health effects of tobacco in deciding
whether our Federal Government should continue to subsidize insurance
for this crop.
How different is tobacco? The tobacco crops that receive Federal
assistance are processed into cigarettes and smokeless spit tobacco
products that kill more than 400,000 Americans every year of cancer,
heart disease, and a variety of other illnesses. These products also
disable hundreds of thousands of other Americans with emphysema and
other respiratory illnesses.
Many of my colleagues will argue, ``Why do you single out tobacco?
For goodness sakes, these farmers are growing crops just like other
farmers.'' These are not crops like other crops. Tobacco is different.
Every day, 3,000 children in America become regular smokers for the
first time. During their lifetime, around 30 of these 3,000 kids will
be murdered, around 60 will die in a car crash, and around 1,000 of
these kids, one in three, will die of smoking-related diseases.
Supporters of the tobacco program will argue that cutting off Federal
crop insurance isn't going to stop kids from smoking. Well, that is
true, but the issue really goes beyond children and smoking. We have a
product here that has no benefit to human health. None. Not even if
used in moderation. Every other crop insured by the taxpayers of this
Nation and subsidized by this Government offers benefits, nutrition,
protein, calories, fiber, every other crop except tobacco.
We are talking here about a product that the owner of one of our
Nation's cigarette companies finally admitted this week under oath is
addictive. Bennett LeBow, owner of the Liggett Group, admitted--finally
admitted--that smoking causes cancer, heart disease, emphysema, and
smoking is addictive.
This is not a news flash for most Americans, but we all remember,
with a sense of shame, the seven tobacco company executives testifying
before the U.S. House of Representatives, standing under oath saying
that their product was not addictive.
Well, we have come a long way. Because tobacco and the nicotine in
tobacco is addictive, many tobacco users find it almost impossible to
quit. They are then set on a path for life that often ends in death.
So the issue before us today is: Should the Federal Government be
subsidizing this crop? Should we, with our tax dollars, subsidize
tobacco?
Last year, the Government spent $97 million on a variety of taxpayer-
supported tobacco subsidies. This chart illustrates the Federal tobacco
subsidies. When my colleagues argue there is no Federal subsidy, they
should consider the real evidence before us.
In 1993, Federal taxpayers gave $65 million of Federal tax money to
the growers and cultivators of tobacco.
In 1994, the figure was $60 million.
In 1995, $51 million.
In 1996, $97 million.
And it is estimated this year that we will spend $67 million to
subsidize tobacco. At a time when we are gripped in a national debate
about the devastation this product causes, we continue, through our
Federal Treasury, to send millions of dollars to the tobacco growers.
At a time when we are cutting back on basic education and health
programs in the name of balancing the budget, for some reason, we can
find the wherewithal and the political strength to divert $67 million
to the cultivation and growth of tobacco.
The U.S. Department of Agriculture estimates that the tobacco-related
expenditures for the current fiscal year will be about $67 million.
What does this consist of? Thirty-nine million dollars is for crop
insurance losses; $9 million for crop insurance administration. That is
a $48 million crop insurance subsidy for tobacco.
[[Page S7903]]
So that you understand, the tobacco growers pay premiums for crop
insurance, and then when they have a bad year and they file their
claims saying, ``Our crops didn't come in as we expected,'' the
premiums they pay are insufficient to cover their losses. Any other
insurance company would go out of business at that point. Not the
Federal Government. We step in and say, ``Let's open the Treasury;
let's make up the difference.''
This chart tries to demonstrate specifically, when it comes to crop
insurance subsidies, what we have been paying, what the net crop
insurance losses have been each year, and you will see that these
losses are substantial.
The administration of the program is also expensive ranging from
about $5.5 million a year to over $11 million a year, money paid by
taxpayers to subsidize crop insurance for tobacco.
The Congressional Budget Office has produced an official estimate
that ending access to the crop insurance program and the noninsured
crop disaster assistance program for tobacco would save us at least--at
least--$34 million for the next year, and beyond that perhaps even
more.
I am offering this amendment today with my colleague, Republican
Senator Judd Gregg of New Hampshire. Tobacco issues have always been
bipartisan issues, as they should be. Our amendment will prohibit the
Federal Government from providing crop insurance for tobacco.
For consistency, the amendment also prohibits payments for tobacco
under the noninsured disaster assistance program, a new, surrogate risk
management program created in the 1996 farm bill.
Federal taxpayers paid around $80 million in net tobacco crop
insurance costs in 1996, including premium subsidies and overhead
administrative costs. These costs have exceeded $29 million in every
year since fiscal year 1993.
There are all the speeches given by all of the Members of Congress of
both political parties protesting what the tobacco companies are doing
and how tobacco is devastating the American population, notwithstanding
each year we fork over millions and millions of dollars to promote the
product that causes all this death and disease.
Now, who supports our effort with this amendment? It has been
endorsed by a wide variety of health groups and spending watchdog
groups, including the Action on Smoking and Health, the American Cancer
Society, the American Heart Association, the American Lung Association,
Friends of the Earth, the National Center for Tobacco-Free Kids, Public
Citizen, Taxpayers for Common Sense, and the U.S. Public Interest
Research Group.
The most common response from the tobacco side is, ``You got it all
wrong, Senator. You just don't understand. Tobacco pays its own way.''
The so-called no-net-cost program was for many years tobacco's defense
whenever we would raise these issues. This program, the so-called no-
net-cost tobacco price support program, is in fact the no-net-cost
program by and large.
Our amendment does not touch the program, so this program will
continue. Those farmers who can and want to participate in it will be
allowed to do so, at their own expense, not at the taxpayers' expense.
In each of the last several years, the Department of Agriculture
spending on tobacco-related programs has cost about $50 million.
We want to make certain that, as we get into this program, the facts
are clear. There are some who will say, ``Why are you picking on
tobacco? We insure a lot of crops in the United States.'' You know,
that is a fact. Here is a list, a partial list--we think there may be
some more--of about 67 crops that are covered by Federal crop
insurance. They run the gamut from almonds to wheat. Corn, of course,
is in there, and soybeans, and so many other products which are used by
Americans nationwide. We have decided, as a nation, that for these 67
crops, we will provide crop insurance.
The defenders of tobacco crop insurance will say, ``Well, wait a
minute. If you're going to provide crop insurance for all these crops,
why don't you provide it for tobacco?'' I have tried to make the public
health case here that tobacco is different. But just to put in
perspective the fact that there are many things grown, cultivated and
raised in America in the name of agriculture and aquaculture which are
not insured, I would like to offer the following charts of crops not
covered by Federal crop insurance.
Forgive me if I do not read them because, honestly, we do not have
the time. But as you can see in chart after chart--I am going to run
out of space here if I am not careful--chart after chart, we have lists
of crops grown by farmers across the United States for which there is
no crop insurance.
In fact, these farmers are on their own. If they should happen to be
growing seeds, as we have in this one chart here, or shrubs, for that
matter, and they have a bad year, there is a drought or a flood, it is
their own luck, maybe their own bad luck.
The final chart here wraps it up. Trust me. There are about 1,600
different crops ranging all the way from watermelons to sod and shrubs
and so many other things that are not insured by the Federal
Government. Among the more than 1,000 commodities not eligible are
honey, broccoli, watermelon, cantaloupes, squash, cherries, cucumbers,
snow peas, even livestock for that matter.
Our crop insurance restriction does not single out tobacco for unique
treatment. It says that tobacco will not be in that special category of
67 insured crops but will be in the other category of about 1,600 crops
and other things raised by America's farmers and ranchers which are not
protected, and I think for good reason.
There is also a complaint that I am hurting small tobacco farmers
with this amendment. Not a single farmer will lose a job because of
this bill. This legislation does not affect crop insurance policies for
the current crop year. The legislation does not affect the tobacco
price support program or Federal extension services. Farmers will still
be eligible to participate in the program at their own expense and sell
tobacco to their customers.
Tobacco farming--and we will hear a lot about small tobacco farmers
eking out a living--is one of the most lucrative forms of agriculture
in America. Gross receipts for tobacco are around $4,000 per acre. We
will be told about little mom and pop operations scraping by for
grocery money raising tobacco. I am sure that can be the case, but keep
in mind that people who are growing tobacco are netting per acre
substantially more than any other legal crop grown in America.
For an acre of corn, you are lucky to bring out gross receipts of
$300 to $400; for tobacco, $4,000. For an acre of wheat, gross receipts
of $200 or less; for tobacco, $4,000 per acre. Data from the USDA
indicates that net receipts from an acre of tobacco averaged between
$450 and $1,100 per acre. According to one of my colleagues, farmers
can get $1,844 in net profit from a net acre of tobacco compared to
$100 for soybeans.
The value of the Federal crop insurance subsidy to tobacco farmers
averages less than $100 per acre. So the question is, if a farmer is
going to get $1,800 in profit off tobacco per acre, will he go out of
business with a new additional cost of $100? I think not.
Can farmers replace this insurance? There is the private insurance
market that they can turn to. It is not offered now because the Federal
Government subsidizes crop insurance for tobacco. But insurance
companies have never shied away from potentially lucrative new markets.
We do expect, though, that farmers will have to pay their own way.
Tobacco farmers will have to pay premiums which will match their
losses. But this amendment, in ending the Federal subsidy for tobacco
crop insurance, does not end the opportunity to buy insurance.
There has been an argument made that this will hurt minority farmers
who will not be able to get loans to grow tobacco if they do not have
crop insurance. This amendment will merely put these tobacco farmers in
the same position as all of the farmers who currently grow crops not
covered by crop insurance. The private insurance market will be
expected to step in and provide this insurance.
Furthermore, in May 1997, the USDA published a study of ``limited-
resource farmers,'' which includes many minority farmers. According to
this report:
Results of the research indicate that socially
disadvantaged, small, and limited-opportunity operators tend
not to purchase
[[Page S7904]]
crop insurance nor to participate in insurance-type programs
operated by the USDA.
Some will argue we should not be doing this today because there is a
tobacco settlement that is being debated. This settlement, I hope, is
going to be enacted this year. But it may not be this year, it may be
next year, it may be even longer.
As currently written, the proposed settlement does not address the
crop insurance issue or any other issues related to tobacco subsidies.
The farmers were not at the table--and I am sure this will be pointed
out by one of my colleagues--during this negotiation for the tobacco
settlement.
This amendment is outside the scope of the proposed settlement, and
we can address this issue separately without getting into the complex
issues raised by the proposed settlement.
Another argument is this will open the floodgates for foreign tobacco
if we do not continue to provide this Federal subsidy, that the
domestic tobacco market will suffer and foreigners will come in to take
their place.
This amendment will not put domestic tobacco farmers out of business.
It will not significantly raise the price of tobacco, which makes only
a small part of the cost of a pack of cigarettes. The value of tobacco
in a pack of cigarettes is estimated to be 10 cents. You know what
people pay for those things? Two, three dollars and more per pack. So
there is no reason to expect tobacco companies to change in any way the
amount of tobacco they purchase from U.S. farmers.
Furthermore, we currently have a tariff rate quota in place for
tobacco which restricts the amount of tobacco that can be imported.
Previous Congresses have already prohibited USDA funding for tobacco-
related research and export assistance.
This legislation takes another important step to make our
agricultural policies more consistent with our health policies
regarding tobacco. I called this amendment for a vote last year in the
House of Representatives, and it came within two votes of passage. It
is my understanding it will be offered again this year. In 1992,
however, the House voted 331-82 to add an amendment to the ag
appropriations bill to prohibit the use of Market Promotion Program
export assistance for tobacco. This amendment was accepted by the
Senate and became law.
In 1993, the ag appropriations bill extended this policy to all
export assistance programs. In 1994, the same bill extended the
prohibition on tobacco assistance to USDA's research program.
This legislation adds crop insurance and noninsured crop disaster
assistance to the list of programs for which tobacco assistance is
excluded.
Mr. President, I know that this amendment is controversial. Every
tobacco issue that I have raised in the House and the Senate has been
controversial. But I believe this is the right thing to do. If we make
this decision today, we will be able to go back to our States and
districts and in good conscience say to the voters that we got the
message, that we have on the one hand said that tobacco is dangerous
for Americans and we have on the other hand said our subsidy will be
ended.
Putting an end to this Federal subsidy for tobacco reflects the
reality of the national debate today. I believe that this amendment
which Senator Gregg and I have offered is a step in the right direction
to make our tax policy and our subsidy policy consistent with our
public health policy.
At this point I will yield for a question to my cosponsor of the
amendment, Mr. Gregg, or if he would like to seek time on his own, I
will yield back the floor.
Mr. GREGG. I appreciate the Senator from Illinois yielding and
congratulate him on this amendment, on which I join him.
The PRESIDING OFFICER. Does the Senator from Illinois yield the
floor?
Mr. DURBIN. I yield the floor.
The PRESIDING OFFICER. Who seeks recognition?
Mr. GREGG addressed the Chair.
The PRESIDING OFFICER. The Senator from New Hampshire.
Mr. GREGG. Mr. President, it is a pleasure to be joining with my
colleague from Illinois today in this amendment to correct what is an
obvious inconsistency, to put it in conservative terms, in American
public policy.
I think there is a general consensus now in this Nation that the use
of tobacco is unfortunate, that we wish to discourage its use,
especially amongst young people, and that as a government we are trying
desperately to inform people of the harm of tobacco to their health and
the addictive nature of tobacco and the fact that there is very little
positive that comes from smoking tobacco.
We have had innumerable Surgeon Generals, including the great Surgeon
General Dr. Koop, point out this problem as a matter of Federal public
policy. We now have a commitment by this administration, and I believe
by this Congress, to try to change the manner in which tobacco is
marketed in this country, especially to the young people, so that we
can lessen the impact of this harmful addiction on America and
especially on our young.
Yet at the same time that we are doing this, at the same time that as
a matter of Federal policy, as presented by the Surgeon General, as
presented by the Congress, as presented by the administration, at the
same time that we are pointing out as a matter of Federal policy that
the use of tobacco is harmful and bad and it has a deleterious effect
on health and a very dramatically negative impact on the financial
situation of this Nation because of its costs in the area of health
costs, at that same time we are subsidizing the capacity of the product
to be grown. It makes no sense at all.
This amendment will save $34 million, but it is hardly the money that
is important here. It is the statement of public policy that is
important. The fact is that, if this Government is going to subsidize
the growing of tobacco at the same time it is claiming tobacco is a
scourge on the health of this country, we are sending two messages
which are totally inconsistent and inappropriate.
Now, the insurance program, as it is presently structured, is a
program which basically puts the grower of tobacco in a unique
position, the position where essentially there is a no-loss situation
where the Federal Government comes in and assures that the grower,
whether tobacco grows or not, whether tobacco is brought to market or
not, is able to recover the value of the tobacco.
This type of a fail-safe situation makes little sense for any
commodity, but it certainly does not make any sense for a commodity
which has already been declared a detriment to the health of America
and especially to the health of children. More importantly, it is not
needed. It is not even needed.
Tobacco is a very lucrative crop. In fact, compared to other crops,
tobacco is dramatically more profitable than other crops. I have a
chart which reflects that fact, which I will not subject you to because
this floor gets enough charts, but essentially tobacco crops as a cash
crop per acre generate approximately $3,700, whereas wheat, for
example, on a per acre basis generates about $134 and corn on a per
acre basis represents about $322. So tobacco is generating 10 times the
value of corn and many times the value of wheat.
It hardly seems a crop which is so lucrative would need to have a
Federal insurance program to guarantee it, but we do have that program,
and that program costs about $34 million a year. Thus, this amendment,
which will put an end to that type of an insurance program, which is,
first, not needed because the crop itself is viable on its own,
regrettably, but it is viable on its own at such high value that it
should not be protected by this type of insurance program; but, second,
an insurance program which flies in the face of the public policy of
the Government generally, especially public policy as stated by the
Surgeon General, the President, and this administration, that that type
of program should be ended.
So this amendment ends it. It is about time we did that. It is
certainly consistent with the direction which this Congress is moving
and this Government is moving and the American people are moving
relative to the use of tobacco and the harm that it is causing in the
area of health in this country.
I congratulate the Senator from Illinois for bringing forward this
amendment. I am happy to join him in it, and I hope that the Members of
the Senate will support it.
[[Page S7905]]
I yield back the balance of my time.
Mr. FORD. Mr. President, there is no time agreement on this
amendment, as I understand it.
The PRESIDING OFFICER (Mr. Thomas). That is correct.
Mr. FORD. And there will not be for a while.
Mr. President, there is a lot of tobacco bashing going on and I
understand that better than anybody in this Chamber. An agreement that
has been negotiated--and my good friend from Illinois, even though we
disagree on this, we are friends, understands--that negotiation is
continuing and we will be called upon to make the ultimate decision as
to whether that negotiated package will fly, will be passed, worked
out, whatever.
Many parts of that negotiated agreement take care of everything that
has been said by my two colleagues, except the farmer. The farmer was
never at the table. You say you will hear a lot about protecting
farmers, the little farm. You are darn right; you will hear a lot about
it. They were not at the table, they were not considered, and so
therefore, here we come, bashing the farmer again.
You say it is a lucrative crop. Well, let's look at something here.
Kentucky's average farm size is 159 acres. The average farm size of
Illinois is 370--that is the difference. Kentucky's average gross
income per farm is $42,000 and the net to that farm is $11,000. The
Illinois average gross income per farm is $128,000, three times what
Kentucky's average farm income is, and their gross profit is more than
double, $25,000 net profit. That is an Illinois farm compared to a
Kentucky farm.
We talk about the gross net profit from one crop which is about an
acre, 1 acre, you get $1,800. But the farmer has to be considered. The
package has not. I am trying to figure out a way that I can be flat so
when the steamroller comes, it won't hurt. But it is another attack on
the tobacco farmer, even though there is no tobacco subsidy--no tobacco
subsidy, and I underscore that.
Tobacco farmers participate--and my friend from Illinois said it--
participate in a price support system that is completely paid for. In
fact, tobacco farmers are unique in that they actually contribute
millions of dollars each year toward deficit reduction--$31 million
last year. There is not another crop or another farmer that is assessed
to pay money into the general fund for deficit reduction.
Last year, the tobacco farmer alone paid over $31 million. I hear
your loss is only 34--maybe it is only 3, because the farmer is paying
almost all of that in an assessment for every pound he sells, and that
is deducted from his check before he gets it, before he goes to the
bank to pay his loan. Crop insurance is not a subsidy. It is not a
subsidy. It is not unique to tobacco. The Durbin amendment does not hit
the tobacco companies.
We hear all about the health. This amendment will not stop one person
from smoking. What it will do is ensure that tobacco farmers will
slowly but surely go out of business. That is what they want. Tobacco
is a culture and it will take a while.
Before we became a nation, if you want to read history, it said that
Mr. Jones came for his spring planting, his seed for his spring
planting, and he paid for it with some of the finest tobacco I have
ever seen. Tobacco was money. Referring to the Mother State, Virginia,
the pages of Virginia history are splattered with tobacco juice. So
tobacco has been here for a long, long time.
Over 60 percent, Mr. President, of every acre farmed in the United
States is covered by crop insurance, and the number is higher for
individual crops. Corn: 85 percent of every acre is covered by crop
insurance. Sugar beets: 89 percent of every acre grown is covered.
Wheat: 90 percent of every acre grown is covered by crop insurance.
Cotton: 94 percent is covered by crop insurance.
Farmers will tell you what tobacco farmers know--all of these farmers
will. Without crop insurance, there is no farm. That is because without
crop insurance, banks will not make loans to growers for their farming
operations. Farmers in my State do not just borrow money to grow
tobacco, they borrow money to grow other crops. Their average income is
$25,000, and their net profit is $11,000. But they would not have that
if they could not get the crop insurance to lay down to the banker to
support the loan.
No legitimate lender--and I say that, legitimate lender--will take
the risk of lending to an uninsured operation. You cannot even borrow
money on a house without an insurance policy, and there will not be a
private-sector substitute for crop insurance, either. Talk about
private sector. One of the reasons the USDA extends crop insurance to a
particular crop is because a private-sector alternative does not exist.
You say, ``Go out and get insurance.'' Well, you can't go out and get
it; it doesn't exist. You can get hail insurance on tobacco at 7
percent of the loss. That is all you get from private carriers. I used
to do it, I understand it.
This is what the American Association of Crop Insurers say:
Privately, underwriting multiple peril insurance has been
tried in the past and it has failed miserably. This is true
for tobacco, as well. Hail, the only peril wholly privately
underwritten, accounts for less than 7 percent of crop losses
in tobacco-growing States. The private sector would be
incapable of insuring the remaining 93 percent risk of loss
on a multiple peril universal base without some form of
catastrophic reinsurance from the Government, but while there
is no farm without crop insurance, discriminating against
tobacco farmers won't do anything to reduce tobacco use.
Won't do anything to reduce tobacco use.
Crop insurance doesn't promote increased use of tobacco any more than
automobile insurance promotes an increase in car sales. The bottom line
of the Durbin amendment is this: American farmers go out of business
and whole communities in the South die. The big tobacco companies
continue to make and sell cigarettes. While communities die, the
manufacturers continue to make and sell cigarettes. If we are going to
talk about making changes to the crop insurance system, it should not
target the family farmer.
Before we get through, I will have a second-degree amendment to the
amendment of the Senator from Illinois. My second-degree amendment
would reform the crop insurance to make sure it supports family farms,
not corporate farms. Let me repeat that. My second-degree amendment
would reform the crop insurance to make sure it supports family
farmers, not corporate farms. I'm prepared to fight this battle. If we
are going to be changing crop insurance, I am prepared to offer second-
degree after second-degree to make sure the changes are comprehensive
and don't single out a commodity or a single type of farmer, because
that is what the Durbin amendment does: It singles out one commodity
grown in one part of the country by one type of farmer, a small family
farmer.
Now, Mr. President, we just heard my friend from Illinois talk about
the loss from tobacco insurance. Well, stand back. Here are all the
losses from other crops. Wheat, since 1984, $288.7 million lost to the
Federal Government--a subsidy to wheat farmers. I don't believe you
would vote today to do away with crop insurance for the wheat farmer,
because you say it is health. Well, everything Kentucky farmers or
North Carolina, South Carolina, Georgia, or Tennessee farmers grow--
even Wisconsin farmers grow tobacco--they get insurance. But they
borrow money and insure other crops. Think about almonds. That was the
very first one the Senator said--almonds. Almost $50 million in loss to
the Federal Government. That is a lot more than tobacco. We could go
down the list. Grain sorghum. I don't know where grain sorghum comes
from--maybe from Illinois, maybe Wyoming, I don't know. But they lost
$36.1 million. So we can get into even sunflowers lost, which is $22
million.
These are losses to other crops, and my friend would not vote to
reduce the loss on wheat or almonds or barley or grain sorghum or these
others, but he would on tobacco because he says tobacco is dangerous.
I am trying to help. I am trying to work out a package. I am trying
to help negotiate. I have listened in every meeting. I have been to
every meeting and we even had one group yesterday that the only thing
they want in the negotiated agreement is some way to eliminate the
addiction. That is fine. The biggest argument in the tobacco negotiated
package will be what percentage of that package the trial lawyers are
going to get. That will be most
[[Page S7906]]
contentious. It is not in there. That is to be negotiated yet.
The result of this elimination of the ability to secure crop
insurance will be devastating to the farmers in my area. Yet, this is
not the biggest loss to agriculture crop insurance. Mr. President, I
have a letter from the Department of Agriculture addressed to Senator
Thad Cochran, chairman of the Subcommittee on Agriculture, Rural
Development, and Related Agencies of the Committee on Appropriations,
and I read just a couple of items. There were 89,000 tobacco growers--
89,000 tobacco growers--with crop insurance policies in 1996. Tobacco
growers in three States--North Carolina, South Carolina and Virginia--
received $77.8 million in indemnities for losses due to back-to-back
hurricanes that hit the east coast last year. These funds helped
communities recover from disaster and were paid for in part by the
producers themselves.
The significance of a program that encourages producers to assess
their individual risk management needs and allows them to pay part of a
cost for coverage must not be lost at a time when fewer dollars--fewer
dollars--are available for other types of assistance. Elimination of
tobacco crop insurance would place a greater burden on other sources of
relief. So when you take it away from one place, you place the burden
on other sources in case of a hurricane or tornado or flood.
But if you have insurance, that lifts the burden from these other
areas that hasn't been offset in your figure here yet. The $77 million
paid last year in three States hasn't been offset from the $34 million.
So it makes a little bit of difference, I think, when you look at it in
the true light. This idea of me crying crocodile tears for the small
farmer, if that's what it takes, I will give you 30 minutes to draw a
crowd to stop this amendment. This amendment is absolutely no different
and the speech is no different than it was in 1992 or 1993 or 1994, or
whenever it was.
So, Mr. President, I hope my colleagues will understand that, yes, we
grow tobacco in Kentucky, yes, we grow a little corn, a little
soybeans, a little wheat. We do the things that other small farmers do.
I want you to remember that the farms in Illinois are almost three
times as large as my average farm, and the net income to the farmer in
the State of Illinois is more than twice what my farmers' net income
would be. Yet, they do grow tobacco.
So, Mr. President, I am going to yield the floor soon so my colleague
from Kentucky can have some time. But I want to make one final point.
The distinguished Senator from Illinois said that all these other crops
are not covered. I think about 1,600, something like that. First, they
haven't petitioned the Federal Government for it. They haven't asked to
participate. A lot of them have private insurance. So you have to be in
a position of requesting it before the Government will consider it. I
don't believe they have petitioned. So it's a little bit unusual.
We don't get anything in tobacco as it relates to the farm bill--not
a dime. Corn gets crop insurance, and we have lost over $288 million.
Yet, they get a check every year as a subsidy. They don't even have to
grow it. That is what we call back in Kentucky a mailbox job. Just go
out to the mailbox and get your check. Everybody lost that. So for
every acre that they have and they signed up, they get a check every
year for so much per acre, whether they grow it or not. The tobacco
farmer doesn't get that.
So there is a bit of fairness here, I think, that ought to be given.
As we work through the problems of the tobacco industry, we need to be
sure that we understand that those who grow tobacco are just as human,
just as religious, just as American, just as needy, just as hard
working as the farmers that grow wheat or corn or granola or whatever.
They are good Americans. I can take you anywhere in my State, in any
town where we have a circle with a courthouse. Usually, on that
courthouse is a monument of some kind to those tobacco farmers who gave
their lives for this country in World War I, World War II, Vietnam, and
the Persian Gulf.
So, let's try to work through this and understand that the people I
represent have no control, basically, over what we are doing here. We
are after the manufacturers, but we are getting at the farmer. Somehow,
some way, we ought not make a farmer in my State who will net $1,800
off of an acre, which is labor intensive, to $4,000, and about half of
that is expense. There is not as much work in corn, soybeans, or
others. The weather works on all of them. But my people are just as
hard working, just as sincere and, I think, need to be helped and
looked after just as anybody else.
This amendment, according to the Secretary of Agriculture, would have
a particular detrimental effect on thousands of small farmers in
tobacco-producing States, not to mention the toll it would take on the
economic stability of many rural communities. Just let me read that one
sentence again. This amendment would have a particularly detrimental
effect on thousands of small farmers in tobacco-producing States, not
to mention the toll it would take on the economic stability of many
rural communities.
An overwhelming majority of crop insurance policies in this area are
sold to small farmers. It seems to me, rather than to cut the cord of
economic stability on the farmer to get after something else, we ought
to be sure that that farmer has an opportunity, and we will get around
to others.
Mr. President, I yield the floor.
Mr. McCONNELL addressed the Chair.
The PRESIDING OFFICER. The Senator from Kentucky.
Mr. McCONNELL. Mr. President, I congratulate my friend and colleague
from Kentucky, Senator Ford, for his statement on behalf of the tobacco
growers of our State.
Mr. President, the Durbin amendment is not directed at the tobacco
companies; it's directed at the tobacco farmer. We don't have many big
farmers in my State. We have about 60,000 tobacco growers in 119 of our
120 counties. They are everywhere. And the average base in Kentucky,
Mr. President, is about an acre.
The profile of a typical tobacco farm family in Kentucky:
The husband probably works in the factory, the wife probably works in
a cut-and-sew plant. They tend to their 1 acre of burley tobacco, and
they sell it in the November and December auction, which provides for
Christmas money and, for a lot of families, a lot more than Christmas
money--Christmas plus a lot of other things they need for their
families during the course of the year.
Now, the Durbin amendment seeks to drive these tobacco farmers out of
business, as if somehow, if you drove the tobacco farmers out of
business, there would not be any more tobacco grown. Of course, it
would be grown. It would just be grown by others. It would be grown in
big corporate farms of hundreds of thousands of acres under contract
with the companies.
So bear in mind, my colleagues, you do nothing to terminate the
growth of tobacco by driving the little tobacco grower out of business.
It serves no useful purpose. Tobacco is going to be grown. It is going
to be grown in this country, overseas, and already is grown in
virtually a great many countries in the world. It is going to be grown,
and nobody is proposing to make it illegal. The only issue before us,
Mr. President, is who grows it? Who grows it? The tobacco program,
which the tobacco growers themselves and the companies pay for at no
net cost to the Government, guarantees that the production is in a
whole lot of hands. In the case of the Commonwealth of Kentucky, it is
in over 60,000 hands.
Senator Durbin's amendment prohibits tobacco farmers from obtaining
Federal crop insurance, as well as disaster payments. That is clearly
directed at the farmer, the grower, not at the companies. The companies
are going to get their tobacco, Mr. President. They are either going to
get it from large corporate farmers under contract, or they will get it
overseas. But they will get their tobacco, even if the 1-acre burley
grower in Kentucky that Senator Ford and I represent is out of business
and a whole lot poorer.
Currently, 1,500 crops are eligible for disaster payments under the
noninsured assistance program. These are crops that are already
eligible for traditional crop insurance. Therefore, if Senator Durbin's
amendment passed, in a natural disaster most small tobacco farmers
would simply not be able
[[Page S7907]]
to recover their losses, putting them out of business. That is why I
say--and as Senator Ford has said--this is an amendment directed at the
farmer and not at the companies.
We have been plagued in Kentucky this year by natural disasters, as
many other areas have as well, and with every other unpredictable
element that farmers have to deal with--disease, labor, incredibly high
expenses. Imagine that we would take away their only meager defense
against Mother Nature just because they farm a legal commodity. It is
simply unfair.
The amendment of the Senator from Illinois prevents many small- and
medium-sized farmers from receiving protection against what could be
catastrophic risks. Farmers may invest up to $2,800 per acre growing
tobacco. Many of them do. A natural disaster--a loss of this
magnitude--simply could not be overcome. So we are talking here about
farmers who depend on their income from this crop.
Additionally, it is important to note that banks and lending
institutions will find it difficult to approve loans for farmers who
cannot obtain crop insurance. So we come down to the real issue here.
Senator Durbin's amendment unfairly singles out tobacco farmers and
tobacco-farming communities who grow a legal crop simply to try to get
at the tobacco companies. Eliminating crop insurance for tobacco
farmers does nothing to stop growing of tobacco or punish cigarette
companies. The only individuals injured are those who can least afford
it, those closest to the poverty level, and those most likely to be
unable to find or afford alternative private insurance.
There is a lot of discussion about alternative private insurance. I
don't think my typical grower with a 2,500-pound base is going to be
able to afford to do that and still purchase that, and still grow the
crop profitably. This amendment is not going to stop people from
smoking. It will only hurt U.S. tobacco growers for whom tobacco pays
the bills--not the big companies.
Tobacco farming, as we all know, is the starting point of over $15
billion that goes to Federal, State, and local governments in tax
revenue, and contributes an additional $6 billion to the U.S. balance
of trade. That is a $6 billion positive balance of trade.
By ignoring the need for disaster relief for the tobacco farmers, the
precedent is being set for the elimination of crop insurance for other
major commodities.
In 1994, we passed a law to end ad hoc disaster programs and have
crop insurance be the primary risk management tool for farmers.
By ignoring the need for disaster relief for just one set of
farmers--tobacco farmers who suffer natural disasters in the same
manner that corn, wheat, soybean, and other farmers do--a precedent is
being set to eliminate crop insurance for other commodities.
Mr. President, as Senator Ford has pointed out, Secretary Glickman is
opposed to this amendment. The Farm Credit Council is opposed to this
amendment. And the American Association of Crop Insurers is opposed as
well.
Crop insurance is to protect families. That is what crop insurance is
about: Helping to minimize the financial interruptions to their plans
and lifestyles due to crop losses.
These are families who usually work two jobs, as I suggested earlier.
In my State, these are not rich farmers. We are talking about people
who cultivate about an acre of tobacco on the side, in addition to
their normal sources of income. These farmers aren't in a business
where they have excess amounts of money in savings. Everything is
calculated, and income from tobacco is relied upon. By having crop
insurance, it gives farmers, bankers, and communities peace of mind
through income stability and minimizing risk.
Crop insurance also provides farm lenders with collateral that helps
minimize liens on other assets, obviously avoiding or reducing a
farmer's needs to rely on credit.
As I believe my colleague from Kentucky pointed out, Secretary
Glickman said:
I am determined that everyone will have access to crop
insurance, large farmers and small farmers alike, especially
those with limited resources--minorities and producers--in
all areas of the country.
That certainly describes the 60,000 tobacco growers of Kentucky.
This amendment would have a particularly detrimental effect on
thousands of small farmers in States like my own. An overwhelming
majority of crop insurance policies in this area are sold to small
farmers. Therefore, eliminating crop insurance for tobacco will not
fulfill the Secretary's promise to poorer farmers. Rather, this
amendment is squarely in opposition to the Department's stated policy
of fighting discrimination against minorities and economically
disadvantaged farmers.
Let me sum it up again. This amendment is directed at the farmer who
is growing a legal crop. To the extent that this small farmer finds it
difficult to acquire crop insurance, the potential for disaster for
these small farm families is greatly enhanced.
The Durbin amendment does nothing to fight smoking. It does nothing
to punish the companies. In fact, it is directed at the heart of the
farming areas in the southeastern part of the United States.
I repeat: The average grower in Kentucky has about 2,500 pounds. That
is about 1 acre. You push that fellow out of business, and tobacco will
still be grown. It is going to be grown by big corporate farms. They
are not going to be particularly concerned about this crop insurance
issue. They do not have any trouble paying for it.
This amendment serves no useful purpose. If you want to fight
smoking, this amendment is only directed at low- and medium-income
farmers in places like the Commonwealth of Kentucky.
Mr. President, I yield the floor.
Mr. FORD addressed the Chair.
The PRESIDING OFFICER [Mr. Santorum]. The Senator from Kentucky.
Mr. FORD. Mr. President, I ask unanimous consent that a letter from
American Association of Crop Insurers, addressed to Chairman Ted
Stevens and Ranking Member Robert C. Byrd, be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
American Association of
Crop Insurers,
Washington, DC, July 16, 1997.
Hon. Ted Stevens,
Chairman, Committee on Appropriations,
U.S. Senate, The Capitol, Washington, DC.
Hon. Robert C. Byrd,
Ranking Member, Committee on Appropriations,
U.S. Senate, The Capitol, Washington, DC.
Dear Mr. Chairman and Mr. Ranking Member: It has come to
our attention that an amendment may be offered to the Fiscal
Year 1998 Agriculture, Rural Development, FDA, and Related
Agencies Appropriations Bill that would eliminate crop
insurance or any other form of government-supported disaster
aid for tobacco. We are writing to express the American
Association of Crop Insurers' (AACI's) opposition to such an
amendment as well as to dispel a principal myth underlying
the amendment.
AACI's membership consists of private insurance companies
who deliver Federally reinsured multiple peril crop insurance
to America's farmers as well as several thousand independent
agents and adjusters affiliated with those companies. All
AACI member companies are also involved in the private crop
hail insurance business as well. AACI member companies and
their affiliated agents collectively wrote over 80% of the
Federal crop insurance sold by private companies in 1996.
Providing risk management protection to American crop
producers is the sole reason that AACI member companies are
in the crop insurance business. As long as data are available
from which an actuarially sound insurance program can be
developed, the insurance industry does not discriminate
against crops that are insured nor the producers who grow
those crops. If Congress were to discriminate against tobacco
producers by denying them any form of Federal assistance
related to their risk management needs, we believe that the
economy of both the producers and the rural communities in
which they live could be placed at severe risk that one
disaster could substantially devastate. In addition, the
economic health of several of our members who have
considerable books of business in tobacco growing states
would also be put at risk.
While it is true that the number of crops covered by
Federal crop insurance is limited when compared with the
total number of crops grown in the country, most if not all
of the crops not currently insurable are covered by the
noninsured disaster assistance program or NAP administered by
the Farm Service Agency. However, both under existing law and
under the proposed amendment, tobacco would be ineligible for
such protection. This isolation among crops leaves the crop
and its producers totally exposed to the uncontrollable risk
of weather.
Some believe that this exposure could be covered by the
private sector without assistance from the Federal
Government. That is
[[Page S7908]]
not true for several reasons. First, the main reason the
Federal Government is involved in crop insurance is due to
the catastrophic nature of crop disasters and the inability
of the private sector to bear that magnitude of loss.
Privately underwritten multiple peril insurance has been
tried in the past and it failed miserably. The inability of
the private sector to bear the risk of loss from multiple
perils is true for tobacco as well. Hail, the principal peril
wholly privately underwritten, accounts for less than 7% of
crop losses in tobacco-growing states. The private sector
would be incapable of insuring the remaining 93% risk of loss
on a multiple-peril, universal basis without some form of
catastrophic reinsurance from the government.
Second, if tobacco farmers were to bear the full cost of
the current policies, that cost would escalate from
approximately $54 an acre to over $125 per acre--a more than
100% increase--when administrative costs are added, risk-
based premium subsidies are removed, and some reinsurance
costs are included. There would be many producers who could
not afford those rates, especially the over 53,000 producers
holding catastrophic policies for which they paid a total of
$50, not $50 per acre.
Third, even if a private multiple peril tobacco policy was
developed, private companies would be unable to make it
universally available. Aside from it not being affordable to
a large number of producers, the catastrophic nature of the
risk would prevent companies from making it available to all
producers. Individual risks would have to be underwritten and
some risks would be denied insurance either directly or
through cost-prohibitive rates. This is unlike the Federal
program where companies must accept all insureds no matter
what the risk without any individual adjustment of rates
since the government sets the rates.
Providing risk management products to tobacco producers and
producers of other crops in tobacco growing states
constitutes a considerable source of income to a number of
rural crop insurance agents and crop adjusters in those
states. If crop insurance for tobacco were eliminated, that
may actually threaten the ability of these agents and
adjusters to stay in business thereby affecting insurance
availability for producers of other crops as well. This is
not to mention the impact on the rural community where the
agents, adjusters, and their support staff live and work.
As long as it is legal to grow a crop in this country and
there are actuarially sufficient data to provide insurance,
AACI members do not believe that the crop or its producers
should be discriminated against. Due to the inability of the
private sector to offer an affordable, universally available
private multiple peril insurance product on tobacco, there
remains a proper role for government involvement. We
encourage you to continue that role by rejecting any
amendment that may terminate that responsibility.
Sincerely,
John E. Sheeley,
Counsel.
Mr. FORD. Mr. President, I would like to put in the Record at this
point a letter from the Secretary of Agriculture to the chairman of the
Subcommittee on Agriculture, Rural Development, Senator Cochran, and
ask unanimous consent that it be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Department of Agriculture,
Office of the Secretary,
Washington, DC, July 23, 1997.
Hon. Thad Cochran,
Chairman, Subcommittee on Agriculture, Rural Development, and
Related Agencies, Committee on Appropriations, U.S.
Senate, Washington, DC.
Dear Thad: I am writing concerning an amendment to the
fiscal year (FY) 1998 Agriculture Appropriations Act offered
by Senator Richard Durbin, which would prohibit the use of
funds to pay the salaries of personnel who provide crop
insurance or noninsured crop disaster assistance for tobacco
for the 1998 and later crop years.
The Department of Agriculture (USDA) opposes this
amendment. Crop insurance and noninsured crop disaster
assistance programs comprise the principal remaining ``safety
net'' for farmers suffering crop losses from natural
disasters, since the elimination of ad hoc disaster aid. The
adoption of this amendment will effectively end our ability
to provide crop insurance and noninsured assistance payments
for tobacco growers.
Crop insurance is an essential part of the producer
``safety net'' envisioned by the Administration's
agricultural policy. There were some 89,000 tobacco growers
with crop insurance policies in 1996, of which 69,000
actually planted the crop for the year. More than 550,000
acres were insured with liability exceeding $1.15 billion.
Tobacco producers paid more than $20 million in premiums to
insure their crops in recognition of the need to provide for
their own risk management at a time when the Government is
providing fewer and fewer farm subsidies.
Tobacco growers in three States (North Carolina, South
Carolina, and Virginia) received $77.8 million in indemnities
for losses due to back-to-back hurricanes that hit the East
Coast last year. These funds helped communities recover from
disaster and were paid for in part by the producers
themselves. The significance of a program that encourages
producers to assess their individual risk management needs
and allows them to pay part of the cost for coverage must not
be lost at a time when fewer dollars are available for other
types of assistance. Elimination of tobacco crop insurance
would place a greater burden on other sources of relief when
disaster strikes.
This amendment would have a particularly detrimental effect
on thousands of small farmers in tobacco producing States,
not to mention the toll it would take on the economic
stability of many rural communities. An overwhelming majority
of crop insurance policies in this area are sold to small
farmers.
I urge you and your colleagues to vote against this
amendment when it is considered by the Senate. Please contact
me if you should need further information.
Sincerely,
Dan Glickman,
Secretary.
Amendment No. 966 to Amendment No. 965
(Purpose: To limit Federal crop insurance to family farmers)
Mr. FORD. I send an amendment in the second degree to the Durbin
amendment to the desk.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:
The Senator from Kentucky [Mr. Ford] proposes an amendment
numbered 966 to amendment numbered 965.
Mr. FORD. Mr. President, I ask unanimous consent that reading of the
amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
Strike all after the first word and insert the following:
LIMITATION OF CROP INSURANCE TO FAMILY FARMERS.
Section 508(a) of the Federal Crop Insurance Act (7 U.S.C.
1508(a)) is amended by adding at the end the following:
``(6) Crop insurance limitation.--
``(A) In general.--To qualify for coverage under a plan of
insurance or reinsurance under this title, a person may not
own or operate farms with more than 400 acres of cropland.
``(B) Definition of person.--The Corporation shall issue
regulations--
``(i) defining the term `person' for purposes of
subparagraph (A): and
``(ii) prescribing such rules as the Corporation determines
necessary to ensure a fair and reasonable application of the
limitation established under subparagraph (A).''.
Mr. FORD. Mr. President, what I have done here, as I said earlier, is
to try to make crop insurance more comprehensive. So what this does is,
it says that any farm with more than 400 acres that can be farmed not
be eligible for crop insurance. The idea here is to let the corporate
farmers pay for themselves, and try to protect the small farmer.
So I think that this amendment will make it fairer. It protects the
small farmers. The corporate farmers, then, the big farmers, those over
400 acres of land that can be farmed--by the way, this does nothing out
West as far as grazing land. It doesn't touch that part of it at all.
It is land that can be farmed.
I yield the floor.
Mr. DURBIN addressed the Chair.
The PRESIDING OFFICER. The Senator from Illinois.
Mr. DURBIN. Mr. President, this may surprise my colleague from
Kentucky. I may support his amendment.
When I was chairman of the House Appropriations Subcommittee on
Agriculture, I was considered by many to be pretty tough on the Crop
Insurance Program, even though, as the Senator from Kentucky has noted,
I come from a corn-growing State, a State with soybeans, a State which
avails itself very much to a great extent in the Crop Insurance
Program. I don't disagree with anything that my colleague from Kentucky
said about the Crop Insurance Program. There are indefensible subsidies
in this program.
I think, if he is going to address an overall reform of crop
insurance, he may be surprised to find me as an ally. I had an
amendment which I offered 1 year in the appropriations subcommittee. If
I recall it correctly, it said that if you have sustained losses in 7
out of the last 10 years on your crop, you would be ineligible for crop
insurance. I have this basic theory that if you couldn't grow a crop
for 7 out of 10 years, God was telling you something about your land,
that crop, or your talent, and that Uncle Sam and the Federal
Government shouldn't be talking back to God in this instance and saying
we will continue to insure the crop.
[[Page S7909]]
There were a lot of people critical of my amendment because they had
worked out a very sweet deal where they would plant crops that could
never grow. It wasn't a sufficiently long growing season. But the crop
was eligible. They would make their application. Lo and behold, the
crop would fail again, and the Federal taxpayers would be asked to make
up the difference.
So, if the Senator from Kentucky is suggesting some basic reform of
the Crop Insurance Program, I think I might be his ally. And if he is
talking about limiting crop insurance to smaller farms, I think he
might be surprised to find that we can work on that as well. But I
think, in all honesty, that this amendment might never have been
offered if I had not started an amendment on tobacco crop insurance.
That is what this is about. It is not about reform of the crop
insurance. It is about tobacco. And the two Senators from Kentucky,
whom I respect very much, in defense of their State and its crop, have
stood up and said, ``Why are you picking on us? Why do you single out
tobacco?'' As one Senator from Kentucky said, tobacco is perfectly
legal. That is true. But tobacco is also perfectly lethal. Tobacco is a
killer. You have to eat an awful lot of corn and soybeans to die. But
you start smoking, get addicted, the chances are 1 out of 3 that it is
going to kill you.
So, to the farmers who are growing it, who, for all intents and
purposes and all appearances, look like any other farmer, what they are
harvesting and what they are selling is devastating. For us to turn our
backs on it and to say it is just another crop is to ignore the
obvious.
Tobacco is the No. 1 preventable cause of death in America today--No.
1. Sure, we are concerned about AIDS. Certainly we are concerned about
highway fatalities. Of course, we are concerned about violent crime.
But if you want to save American lives, the first stop is tobacco. Take
a look at what it does to us.
For my colleagues to stand up and say, ``It is just another farmer,
it is just another agricultural product, why do you single us out,'' it
is because it is the only crop, when used according to the
manufacturer's directions, will kill you. You can't smoke in
moderation. You start this addiction, and you will end up generally as
a statistic.
So, when I bring this amendment to the floor to talk about crop
insurance for tobacco, I can understand my colleagues from tobacco-
producing States. I can understand it completely. I have represented a
congressional district and a State which has its own interests, and I
have try to defend those interests. I think that is part of my
responsibility.
But I say to my colleagues who are viewing this debate and making up
their own mind: Make no mistake, tobacco is not just another product.
Crop insurance for tobacco is a blatant contradiction that we would
piously pronounce through the Surgeon General's office and the
Department of Health and Human Services that this crop is a killer,
that these tobacco products are claiming lives--even innocent victims
like these flight attendants who are now suing down in Florida who
happened to be exposed to secondhand smoke. Their lives were in
jeopardy, too. We know this. We concede this. We advertise this. We
spend millions of dollars to police this industry because we know what
they are doing. They are addicting our children, and they are killing
our fellow citizens.
That is why it is totally inconsistent for us to be in a position
where year after year we are plowing millions of taxpayer dollars
collected from people across the United States into the subsidy--
underline the word ``subsidy''--of tobacco growers.
I just marvel when my colleagues get up. We can argue a lot of this
on the merits. But it takes my breath away to hear these colleagues
stand up and say that there is no tobacco subsidy.
Let me go back to this Federal tobacco subsidy chart.
There is this tobacco subsidy: $65 million in 1993; $60 million in
1994; $51 million in 1995. In 1996, when I first took on this issue,
they estimated our losses would be about the same--$50 million. They
went to $97 million, and then in 1997 the estimate was $67 million.
Mr. FORD. Will the Senator yield for a question?
Mr. DURBIN. I am happy to yield for a question.
Mr. FORD. I am sure he will be able to answer this and make me look
bad. But this is just on crop insurance.
Mr. DURBIN. It is on crop insurance and administering the program.
Mr. FORD. Administration of the program.
Mr. DURBIN. I think there are two or three other small, related
areas.
Mr. FORD. This is just tobacco.
Mr. DURBIN. That is true.
Mr. FORD. What about the $77 million that went to the hurricanes in
North and South Carolina and Virginia that was paid and helped the
communities or they would have taken the money out of some other fund
as it relates to disasters?
Mr. DURBIN. I don't believe that these figures include any national
disaster assistance of that nature. It is strictly related to crop
insurance.
Mr. FORD. Is the money in the premiums in your figures here paid by
the farmer--deducted, and this is the net?
Mr. DURBIN. What this represents is the net cost to the Federal
Treasury.
Mr. FORD. Just for that. And what about the overall loss from other
crops?
Mr. DURBIN. Oh, it is substantial.
Mr. FORD. Substantial.
Mr. DURBIN. I can recall, 1 year it was $240 million, all crops
included.
Mr. FORD. Here you are damaging the farmer that is beginning to feel
the pinch anyhow and hoping that we could negotiate some kind of an
agreement. He is left out. You still want to eliminate this part of his
everyday life.
Mr. DURBIN. I want to eliminate crop insurance for tobacco. I will
concede to my colleague that the overall subsidy for crop insurance, as
I said at the outset, is an issue well worth addressing. The fact that
we would spend--perhaps the Senator from Mississippi has more current
figures--we would spend in the neighborhood of $200 million subsidizing
crop insurance in America is an issue which I will happily join with my
colleague from Kentucky and other States to address.
But lest we forget, this debate started on the issue of tobacco, and
although many of my colleagues want to raise a variety of other issues,
we still have to face the reality that when this debate is over, we are
going to face this question time and again when we go home: Senator,
what's going on here? I can't pick up a newspaper, a news magazine,
turn on the radio or television and I am not being told how bad tobacco
is for America. Why do you keep plowing millions of my tax dollars into
the subsidy of this tobacco crop? How can you justify it?
I cannot. That is why I am offering the amendment. And I would say to
my colleagues from the tobacco producing States, it is time to accept
reality. And reality will tell you this. The day when the Federal
Government rushed to the rescue of tobacco is over. I do not know if I
will succeed with this amendment today, but tobacco's days in the U.S.
Department of Agriculture are numbered. They know it, the tobacco
farmers know it, and the tobacco companies know it. They know full
well, as they have watched the course of events over the last 5 or 6
years, that each year we have eliminated another Federal program
relative to tobacco--research, export assistance, market promotion
program. We have closed those doors, and those doors have remained
shut.
The tobacco growers and industry realized long ago that if they
wanted an allotment program that gives them the advantage of making the
kind of money we are talking about, they would have to pay for their
own program. And they did it. And yet now we are in a part of this
debate where they are saying we want to hang onto this last Federal
subsidy.
Make no mistake; this second-degree amendment offered by my
colleague, the Senator from Kentucky, does not just reform crop
insurance. It strikes our prohibition before inserting his addition. So
he is not adding to my amendment. He wants to get me out of the way. He
wants to talk about crop insurance programs. He does not want to talk
about tobacco. That is a delicate subject. But it is a delicate subject
I have been talking about for 10 years.
And I want to tell you, too, I think the tide of history is on my
side. I hope I am around to see that tide hit the
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shore. I hope I am still standing when it does. But a little over 10
years ago, I offered the first amendment in my long and checkered
career on this issue to ban smoking on airplanes--10 years ago. Every
leader in the House of Representatives, Democrat and Republican,
opposed me, every committee chairman, and we went to the floor. They
said we were meddling with tobacco, and they did not care for it, and
tobacco lobbied. Folks, I want to tell you, the monsters of the midway
are not the Chicago Bears. The monsters of the midway are the tobacco
lobbyists in this town. They came down like a ton of bricks on this
amendment. But you know what. We won. By 5 votes we won, 198 to 193,
and I was the most surprised Member of Congress standing in the Chamber
of the House when it happened.
What it told me then and tells me now is that we are going to win
this battle--maybe not today. I hope we do. Maybe not today, but we
will. And the tobacco growers and tobacco companies have to accept the
reality that if their product is to remain legal, if it is to remain
legal, they have to change the way they do business. They have to stop
asking for this Federal subsidy. They have to stop selling tobacco to
our kids.
If they do not agree to those two things, they are going to continue
to face this kind of opposition year in and year out, and it will
continue unabated. Those who are here in the Chamber, my colleagues,
and some who are in the gallery who have taken the time to tour this
beautiful building--and it is magnificent. I am very proud to be a
Member of the Senate and to be able to practice my profession in this
building--they will take a look around at the columns as they walk
through the corridors and they will find at the top of these columns a
curious leaf.
What could it be? Well, you know what. Many of these columns are
adorned with tobacco leaves. It tells you something about the history
of the United States of America and the history of this Congress. When
the President of the United States comes for an address to the Joint
Session of Congress, State of the Union Address, for example, he stands
in front of a wooden podium. Carved in the side of that wooden podium
are tobacco leaves. It is part of America and it is part of our
history. And there are some people who do not want to give up on that
piece of history. They want to hang in there one more year for tobacco:
Oh, we can do it. We can survive. We can offer perfecting amendments.
We are going to fight for 1 more year.
But the tide of history is not on their side. It was not that long
ago, even in my lifetime, when doctors used to advertise the healthiest
cigarettes to smoke. It has not been that long ago that you could have
a smoking and nonsmoking section on an airplane and create the fiction
you were protecting people, knowing full well that you were not.
Those days are over. And as these tobacco companies come in here
ready to negotiate, not because of a guilty conscience, because of
their additional efforts to make money, we can see the tide changing.
And yet we hang onto this vestige of the old school, this relic of
history which for 60 years has said that the Federal taxpayers will
defend and subsidize tobacco. That has to come to an end, and it has to
come to an end sooner rather than later.
Let us take the money we save with my amendment and use it for
valuable, positive things that will help all of rural America. Let us
use it for programs that are beneficial, health assistance to everyone
across this Nation. The amendment that has been offered by my colleague
from Kentucky is an amendment which seeks to win this battle today, put
it off, at least the overall issue, for another day. But that is not
good for America. It does us no good as a nation to turn our back on
this reality.
I say to my colleague as well, although he may question this, I will
tell him in all sincerity, I understand his concern for his farmers. I
give him my word now as I have in previous debates that if he is
prepared to offer an amendment as part of this tobacco agreement to
help his farmers, either phaseout of tobacco growth, move in other
areas, I will be there, I will help him. Tobacco companies owe a great
deal to the American tobacco growers, and I don't run into too many
tobacco farmers who defend them, incidentally, because they know full
well these same tobacco companies haven't treated America's tobacco
farmers very well. They continue to import cheaper tobacco from
overseas. They turn their backs on the very farmers whose tractors and
skirts they have hid behind for decades. It was not fair the tobacco
growers were not at the table.
If the Senator from Kentucky or anyone on that side of the debate
wants to suggest a change in this overall agreement to provide
assistance to those tobacco growers so that they can phase in to a
different type of production or phaseout of tobacco growth, I am happy
to join him in that effort. My war is not with those farmers. My war is
with what they are growing in their fields, because what they grow in
those fields is deadly. It is lethal. It is something that can't be
ignored or swept aside as just another agricultural issue.
I can recall during past debates on this people have stood up and
said you can't single out tobacco when it comes to America's export
policy, and yet we have done it. People have said you cannot single out
tobacco when it comes to research. Basically, we have done it. People
have said time and again that you cannot separate tobacco as a crop.
But I believe the American people know the difference. They know the
difference between a bushel of corn that may be used for a variety of
positive things. They know the difference between a bushel of soybeans
that may be used for a variety of things, positive for American
families, or a bail of cotton. You cannot say the same thing about
these tobacco leaves.
So, Mr. President, I oppose this amendment, not because of its
underlying wisdom but because it is offered only, exclusively, solely
for one reason--push the tobacco debate off for another day. I believe,
and I believe my colleagues will join me in this belief, that you
cannot wait another day. You have to move forward with this debate and
address this issue now.
Mr. President, I yield the floor.
The PRESIDING OFFICER. The Senator from Mississippi.
Mr. COCHRAN. Mr. President, this has been a very vigorous and
informative debate, in my judgment. I have no parochial interest in
that our State does not grow tobacco. We have no program for tobacco,
for any of the producers of agricultural commodities in our State, but
I am persuaded by the arguments that have been made by the Senator from
Kentucky about the economic consequences of this amendment, and that is
bolstered by the letter the distinguished Senator from Kentucky [Mr.
Ford], mentioned that had been received by me today from the Secretary
of Agriculture which points out the detrimental effect that the
amendment offered by the Senator from Illinois would have on
agriculture producers in the United States if it were to be passed by
the Senate.
So I am constrained to oppose the amendment of the Senator from
Illinois, but I am also troubled very much by the second-degree
amendment that has now been offered by my good friend from Kentucky
which limits the application of the crop insurance program to farmable
acreage of less than 400 acres. And that is troubling because so many
of our farmers in my State and elsewhere throughout the country have
more than 400 acres under cultivation, and this would be discriminatory
in a different kind of way. So I am troubled by that amendment and I do
not want to see that passed.
So I am in a position and I think the best course of action for me as
manager of the bill is to move to table the underlying amendment. If
that motion to table passes, then it takes both the underlying
amendment and the second-degree amendment with it as I understand it.
So at this point, knowing that debate has been occurring for a little
over an hour now and with the knowledge that we will set this aside,
not to vote on it now but at a time to be determined later, I now move
to table the underlying amendment and I ask for the yeas and nays.
The PRESIDING OFFICER (Mr. Gregg). Is there a sufficient second?
There appears to be a sufficient second.
The yeas and nays were ordered.
Mr. COCHRAN. Mr. President, I ask unanimous consent that the vote on
the motion to table be set aside and to
[[Page S7911]]
occur at a time to be established later in the day.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
The PRESIDING OFFICER. The Senator from Alaska.
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