[Congressional Record Volume 144, Number 87 (Monday, July 6, 1998)]
[Senate]
[Pages S7521-S7524]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
FAMILY FARM CRISIS
Mr. DORGAN. Madam President, for the Record, I want to read a letter
from Joni Flaten from Langdon, ND. I visited with her this afternoon.
She sent me a letter some while ago. She is a farm wife. We have a huge
farm crisis not only in my State of North Dakota, but also in the
entire wheat belt. Grain prices have collapsed. We have been hit with
the toughest, worst outbreak of crop disease in a century in North
Dakota. So you take crop disease that devastates the crop and then you
add collapsed prices, and you have a calamity for a lot of family
farmers.
Joni Flaten writes:
My husband has been farming now for 18 years. He is a third
generation farmer, and with my oldest son graduating last
Sunday, we were looking forward to some day having the fourth
generation. However, that will no longer be possible for we
have been unable to get an operating loan this season due to
low grain prices . . .
I have 3 children and have stayed home for 18 years to
raise them and help my husband on the farm. We are now going
to be forced into giving up the family farm, and I'm not sure
if there is a lot of need for a 38-year-old combine operator/
tractor driver/trucker/run for parts person and be a mother
in the work force in North Dakota. We have been a true family
operation since the boys were able to see over the steering
wheels . . . We have not been able to hire an extra man to
help us, but we have pulled together as a family at planting
and harvest times to get the job done. Now Farm Credit tells
us we are unable to get a loan to operate our farm. FAHS
tells us we can't have a loan and the sad truth is such a
blow to all of my family. Not that you or anyone can do
much about this but maybe somehow you can stop it from
happening to some other family in the future. It is a good
life here in ND but I think you will be 5 people less come
this winter!!!
This is from a woman named Joni Flaten, a farm wife, has been a farm
wife for 18 years, and they are losing their livelihood, losing their
family farm.
Let me show you a picture of Bev and Jim McAllister from Oriska, ND.
Jim McAllister came to a meeting that I had in Mandan, ND, a few months
ago. You can see Jim is a pretty big guy. He stood up at that meeting
and began talking about his family farm. He said his granddad farmed
it, his dad farmed it, and he has farmed it for 23 years. Then his chin
began to quiver and he got tears in his eyes. Then he said he is going
to have to quit farming. Jim and Bev McAllister love farming. They are
family farmers. They have raised their family on the farm. It is a way
of life they say they wouldn't have traded for anything, and yet they
are having to leave the farm. There family farm will be history. No
more family farming for the McAllister family.
Why is this happening?
This is a picture of an auction sale in North Dakota. You can see
what an auction sale looks like. There are a lot of folks standing
around with an auctioneer auctioning off farm machinery. Here are pages
from a North Dakota newspaper. It shows about 150 auction sales. It is
all advertised in the same week's paper. These auction sales go out for
a good number of weeks. This listing includes some 150 auction sales.
They have had so many auction sales on North Dakota farms that they
have had to call retired auctioneers back from retirement to handle the
auction sales. Every one of these auction sales represents a family
farmer who has tried to invest everything they have, and have worked
hard, to run a family farm. And then they discover they can't make it.
Why can't they make it? Well, farmers are beset by a whole range of
problems these days. First, they wrote a new farm program in Congress
two years ago. I didn't vote for it. I thought it was a terrible farm
program. But those who voted for it--and the President reluctantly
signed it--essentially said we are going to pull the safety net
[[Page S7522]]
out from under family farmers. It doesn't matter what the circumstances
are. If grain prices collapse, somehow we are going to still pull the
safety net out from under family farmers and instead set up a
decreasing scale of price supports, eventually hoping that family
farmers will deal in whatever is the open market. They called this
program Freedom to Farm.
It would be like saying to the people in the workforce we are going
to reduce the minimum wage to $1 an hour and we are going to call it
``Freedom to Work.'' It is the same logic, exactly the same logic. If
they cut the minimum wage to $1 an hour and call it ``Freedom to
Work,'' it would make as much sense as what they have done to family
farmers.
Here is what family farmers face in my State. Wheat costs somewhere
around $4.50 to $5 a bushel to raise. When farmers plant it in the
spring, in order to plant it they have to have equipment. They have to
buy fuel for the tractor. They have to buy seed to plant in the ground.
They have to buy fertilizer to fertilize it. They till and seed the
ground, and hope and pray and cross their fingers and hope they get
enough moisture. If they get enough moisture for that, and if they grow
wheat, barley, or corn, they hope it doesn't hail and destroy the crop.
Then they hope the insects don't come and eat the crop. And, they hope
they don't experience crop disease that will in other ways ravage and
decimate the crop. If all of that is avoided, then maybe in the fall
they will have a crop that has come out of the ground and is high
enough to harvest. Then they will buy fuel for the combine and they
will go harvest the crop. When all of that is done, if they have been
very lucky, they will have raised a crop that cost them $4.50 or $5 a
bushel to raise, and they truck it to the county elevator, and they may
get $3.10 a bushel for it. That means they go broke.
On top of the collapsed prices, in North Dakota and a couple of other
States, we have been ravaged by the worst possible crop disease. It is
called scab. The technical name is fusarium head blight. I am told that
this is the worst crop disease in this century. So these family farmers
are trying to fight a crop disease that decimates their crop and then a
price that is in the tank. The question is: Does anybody care? Does
anybody care at all?
We had a group of Senators a week and a half ago who held a press
conference that said, ``Gee, this farm bill is working just fine. We
think things are on the right track.'' What planet could they have
possibly come from? Where on Earth did they get off the mother ship?
How could they say, ``This farm bill is working just fine?"
I would encourage anyone who thinks that to go buy a quarter section
of land and plant yourself a crop. After you plant it, raise the crop,
and then sell it, then you will have the big loss that you are going to
get under this farm program. After you have done that, then come and
gloat about how the farm program is working. I dare you. See, if you
have the courage of your convictions. Any one of those who think this
farm program is working just fine, should go buy a farm and have the
opportunity to lose some money for awhile. Then you will have your
banker tell you it is not working out. Only then should you come back
and give us your theory and tell us how great the farm program is
working. Just do it. But don't come in here and preach these platitudes
about a program working when it is a disaster. Freedom to Farm has been
a disaster for family farmers.
Let me tell you what else is facing family farmers. There are
hundreds of thousands of family farmers out there. There are almost two
million of them out there. You see them with a yard light on at night
dotting the countryside. They are raising a family and planting crops.
Let s say they are raising livestock and they go to market. Let's
assume they are taking some cows to market. What they find at the
marketplace is the neck of that bottle up through which they are trying
to market is squeezed by four beef packing plants. Four beef packing
companies in this country control 87 percent of the market. That is
right. Four firms with 87 percent of the market. Ten years ago, it was
67 percent. Now those four control 87 percent of the market. They set
the market. They tell somebody out there who is herding cows and
raising cattle exactly what they are going to pay them. If they don't
like it, tough luck.
If you are not raising cows, maybe you are raising hogs. The top four
pork packers in this country control 60 percent of that market. If you
go into a packing house that slaughters hogs, 60 percent of the market
is controlled by only four companies. With sheep, it is 73 percent of
the market that is controlled by the top four companies.
How about raising grain? The top four firms in flour milling in this
country have 62 percent of the market. The top four grain elevator
firms control nearly 60 percent of the Nation's elevator facilities at
our ports. The top four corn milling firms control 74 percent of the
market. In soybean crushing, the top four firms have 76 percent of the
market. When farmers try to market through the neck of this bottle, it
is squeezed with an iron grip by increasing monopoly pricing power by
corporations that press down on these farm prices.
If that is not enough for our farmers to face, then they have to haul
their grain to the markets on railroads that are increasingly
monopolistic. In 1980, there were 40 class-one railroads in this
country. Now there are only four.
In our State, when they come through with the railroad cars, they
charge $2,300 to ship a carload of wheat from Bismarck, ND, to
Minneapolis. The railroad charges $1,000 to ship a carload of wheat
from Minneapolis to Chicago, which is the same distance. What is the
difference? The difference is that on one segment there is competition
and, therefore, lower prices. In North Dakota, there is not. Therefore,
they charge us more than double. We get overcharged because there isn't
competition.
If farmers aren't discouraged enough by prices that are in the tank
or by markets that are controlled by increasingly monopolistic
tendencies, then they are beset by trade problems.
The Canadian trade agreement that we have is unforgivable in the way
it was negotiated. The United States negotiator went to Canada and
negotiated a United States-Canada trade agreement and fundamentally
sold out agricultural interests. I say that understanding exactly what
I am saying. I am sure the trade ambassador got other concessions. But
family farmers had the rug pulled out from under them. Every day we
have carloads and carloads of grain coming across from Canada into our
marketplace. In my judgment this is in contravention of U.S. law. Yet,
the Canadians refuse to open their books to GAO audits. In fact, they
just recently refused once again to allow the GAO at my request to go
up and audit their books. I think they are guilty of violating American
trade laws. But they say, ``No. We are going to ship all of this
product into your country and we don't intend to open our books to
you.''
The United States-Canada free trade agreement is an outrage. It takes
money right out of the pockets of family farmers, and it has gone on
for a number of years, and nobody seems to care much. It is not just
grain that comes in from Canada. It is also truckload after truckload
of livestock. But nobody seems to care much.
It seems to me that farmers are told in every way that somehow it is
a free market out there. They are told to go participate in that free
market. Yet, when it comes to this country deciding that it wants to
impose sanctions on Cuba, farmers are told: Oh, by the way, you can't
sell grain to Cuba. Or they are told, by the way, you can't sell grain
to Iran; and, you can't sell grain to Iraq; and, you can't sell grain
to Libya.
Farmers are told, you have to pay the cost of those markets that are
closed to you. Farmers are told they have to pay the cost of lost wheat
sales to China, because we don't have the backbone to stand up to
China. We should say to China, if you send us your shirts, your
trousers, your shoes, and your trinkets, you then have to buy our
wheat. Yet, because we don't have the backbone to say to China that as
a condition of our market absorbing all her products that China must
buy American grain. Farmers bear the consequences of those kinds of
incompetent trade agreements and the lack of will and the lack of nerve
and the lack of backbone. Farmers bear the consequence of that.
[[Page S7523]]
Most people probably don't know much about farming. Most people
probably don't care much about farming. They probably in many cases
think that food comes from a carton somewhere at the grocery store.
I had a fellow come to North Dakota once. He was a Member of
Congress, who had never been on a farm. I decided that since he votes
on farm policy issues that I should really take him out and show him a
farm. And we did. We went to a dairy barn. And the dairy business is as
tough a business as there is. It is hard. You get up early in the
morning and milk cows. The last thing you do at the end of the day is
milk cows. There is no tougher job in the country.
My friend was standing there in a blue-striped suit, which is the
uniform for Congress, and he saw how hard this was. This fellow and his
wife were in the dairy barn on a little farm north of New Salem, ND,
and they were milking about 90 cows. That is tough. It was about 5:30
in the evening. The light was shafting through the barn, and it was
beautiful. And my friend, this Congressman, watched this go on, and
finally he said to the farmer, ``How often do you have to do this?''
The farmer was hooking up the milk machines. It is very tough work. He
says, ``How often do you have to do this?'' The farmer, whose name was
George, said, ``Well, you have to do it twice a day. You have to do it
every morning and you have to do it every evening.''
And my friend, the Congressman from out east, thought about that a
bit, and then he said, ``George, do you have to do this on weekends,
too?'' And he didn't know. Of course, you have to do it on weekends.
You milk 7 days a week twice a day. But he didn't know it. He had never
been on a farm.
Family farmers work hard, risk everything they have. In every
circumstance, all they want to do is make a decent living. And what we
are finding in North Dakota and across the farm belt these days is that
we have the goofiest, most detrimental farm program you can possibly
conceive. What does our farm program say to our family farmers out
there? What does it say to some lonely farm family living on the farm
with a yard light on at night, 5 miles from the nearest neighbor?
What we say to them is that you are on your own. You fight the big
grain trade firms. You fight the railroad companies. You fight the meat
packing plants. And, when you are done with those fights, which by the
way you are going to lose, then you go ahead and fight the European
Union, because they are subsidizing their farmers. You fight China
which keeps your wheat out. You fight Japan that doesn't buy enough
beef. You go ahead and fight Canada that floods your market and takes
money out of your pocket.
We tell our farmers that they have to wage those fights alone, and we
know they are going to lose. Yet, we have people on the floor of the
Senate who chant, ``Free market.'' All they can do is chant, ``Free
market.'' There has never been a free market in agriculture. There
never has been, and there probably never will be.
Nobody would like it more than I would if farmers could go to the
grain elevator with their 2-ton truck, haul their wheat in and get a
decent price. Nobody would like that better than I would, because
farmers ought to be able to get a decent price from the marketplace.
What if farmers can't? Does this country care whether there are any
family farmers left? It is questionable whether at least some in the
Congress care at all. But, if this country cares about whether there
are family farmers left, then if farmers can't get the price at the
grain elevator because the market is a manipulated market that is not a
free market at all, then there has to be some mechanism, as other
countries have done, that says to family farmers, here is a support
price in the event you can't get a decent price at the marketplace. It
is the only way we will keep family farmers on the farm.
Now, we don't have much choice, it seems to me, in the coming weeks.
We are going to have to decide that we are either going to do something
to respond to this farm crisis or we are going to see wholesale farm
bankruptcies all across the country. The very survival of family farms
is what is at stake.
Let me just briefly go through a couple of charts.
Here is what has happened to wheat prices. Wheat prices have fallen
53 percent in the 2 years since the farm bill was passed. That is what
has happened to wheat prices under Freedom to Farm. If you love Freedom
to Farm, then vote Freedom to Farm. But here is what has happened to
wheat prices. You can chant ``Freedom'' all you like, and it is not
going to help families on the farm stay on the farm. As I said when I
started, chanting ``Freedom to Farm'' and pulling the rug out from
family farmers, would be the same thing as coming to the floor and
saying what we propose is to cut the minimum wage to a dollar an hour
and we will call it freedom to work. It is exactly the same principle.
That is what has happened to grain prices. They have dropped from
$5.75 per bushel to $2.72 per bushel. That is why farmers are in such
significant trouble.
Secondly, in addition to that, there is no longer a disaster program.
Now when you suffer disasters, we cannot respond to it. That is also
part of the Freedom-to-Farm approach. I want to show you what has
happened to family farmers in North Dakota.
This is only one State. The red area means that these counties and
those farmers living in those counties have been living in a county
declared a disaster area for 5 years in a row. The orange areas have
had disasters 4 out of 5 years. You can see that takes up the entire
eastern half of the State. Incidentally, this half of my State is equal
to five times Massachusetts in land mass. North Dakota is 10 times the
size of Massachusetts in land size. But this half of North Dakota has
had a disaster declaration for every county 4 out of 5 years. A third
of our counties have been declared a disaster every year. All of our
counties were declared a disaster area this past year.
Family farmers can't make it when they have disaster after disaster
after disaster. Yet, we have people in Congress saying to them, ``Well,
so what. Go to the marketplace. It's a free market.'' It is not a free
market.
When you have crop disease and disasters, resulting from the wet
cycle, and collapsed prices, here is what happens to income: In 1 year,
there was a 98 percent reduction in net farm income. Family farmers as
a group in North Dakota lost 98 percent of their net income. Think of
it. Can you think of anyone else in your neighborhood, anyone in your
town, who would still be on their feet if they lost 98 percent of their
net income? I don't think so; not with a 98 percent loss in net income.
Here is what happened to the production costs for family farmers.
They have to buy tractors, right? In 20 years, here is what happened to
the price of a tractor? In the past 20 years, here is what happened to
the price of a combine. Look at what has happened to the fertilizer
costs and what has happened to the price of diesel fuel. And then I
showed you what happened to wheat prices. All of those input costs
increased dramatically and wheat prices come down.
Well, there are a lot of solutions to this, some of which will
appease no one in this Chamber, I suppose. Yet, we must decide as a
Congress whether this matters.
If we have big corporations in this country that get into trouble,
gosh, there are all kinds of friends there willing to fluff up their
pillow and give them an aspirin and get them to bed for a short nap,
maybe give them a transitional loan.
It is really interesting. While I am describing to you the problems
in family farming, think of what has happened during this period of
time when family farmers like Jim McAllister and Joni Flaten and others
are losing everything they have. Yes, absolutely everything. What is
happening on the front page of your newspaper? All the biggest
companies in the country are finding romance once again. They are
dating, and then they are getting married, and so we have these big
mergers and combinations. Gosh, they love each other. The bigger, the
better. At the upper end of this economic system, things are just
swimming, I guess. There are record profits, and the largest mergers in
the history of humankind. And at the bottom, the folks who are out
there trying to raise a family
[[Page S7524]]
and keep a yard light on and run a family farm are going broke in
record numbers.
There is something really wrong with that. There is something wrong
with a system that doesn't reward what this country should value most
and that doesn't connect effort and reward. You talk about effort? You
know, family farmers are the ones who invest everything they have, work
hard, risk everything they have, and then discover at the end of it
that they don't have the capability of continuing. And this country has
a policy that says that is fine; we don't care about that?
We are going to have a big fight in this Chamber this summer to see
who cares. Some people may say they don't care. Or they may say they
care, but they have constructed these goof-ball policies and they just
want to stand over in a corner and chant about free markets. That is
one solution, I guess. But that solution will simply continue this
decline, this spiral of failing our family farms.
But there are other ways to address this. One is for this Congress to
write a simple farm plan that starts with one single sentence, and that
sentence says: The purpose of this farm bill is to maintain a network
of family farms in this country.
Otherwise, you will have corporate agrifactories farm from California
to Maine. There won't be anybody living in the country, and the price
of food will go up. That can happen and probably will happen unless
this country decides that family farmers are in this country's best
interests. Thomas Jefferson used to say that it is in this country's
best interests to maintain a broad network of ownership in this
country. Broad-based economic ownership is critical to the success of
this country.
Even if one doesn't care about family farmers, one ought to care
about the disparity that exists here. We should care about the massive
failure at the bottom of the system affecting people who really produce
real things, and the orgy of mergers that is occurring at the top with
the big getting bigger.
One of the things that bothers me the most about all of this is the
people who are out there raising a kernel of wheat or corn or barley to
take it to the market are the very ones who are failing. And then
everybody else who gets hold of that seems to be making record profits.
Go to the grocery store and buy a box of cereal and look at the price.
Somebody took that kernel of wheat or corn or grain of rice and they
might have puffed it. Now that it is made into puffed wheat, does its
price bear any relationship to the price that the farmer gets for the
wheat? No, not at all. The farmer gets a pitiful price that is
insufficient to keep the farmer in business. But those who process it,
those who haul it, those who puff it, those who crisp it, those who
shred it, they are all making record profits. There is something wrong
with that. There is something wrong with the method by which this
system values what people contribute to our economic system.
Some people might say to me, ``Gee, you come from North Dakota and
you have a different view of economics. You didn't go to the University
of Chicago, the School of Economics; you don't understand free
markets,'' and so on. No, I understand it. I understand the difference
between the theory, the chanting and all the nonsense and the reality
that exists every day confronting people who produce every day.
So I know there will be some in this Chamber who will be upset this
summer that we are going to push them very hard on these policies.
Those of us who have other ideas and believe there is a better way and
different approach and believe there is a way for this Congress to
stand up for family farming. We need to say to our family farmers, just
as the Europeans have said to their family farmers and other countries
have said to theirs, that you matter. Your presence as a producer, as a
family farmer in this country, makes a difference to us. It strengthens
this country. It nurtures this country.
The formation of family values in America always came from family
farms. The seed bed of family values came from family farms. They have
rolled into small towns and rolled into the cities, nurturing and
refreshing the family values of this country. So, therefore, family
farming matters. It is more than just dollars and cents, and it is more
than just economics. Family farming, as an economic and social policy,
matters in this country.
Those who have currently gained the upper hand politically on this
issue have constructed a farm policy that says, ``We are going to pull
the rug out from under you even as we negotiate bad trade agreements.
We are going to pull the rug out from under you on support and there
will be no disaster programs for massive crop disease.'' Those folks
are not going to like what some of us feel we must do this summer to
try to force the issue to deal with family farming.
Mr. President, I think of Joni Flaten, a 38-year-old woman from
Langdon, ND, who writes a letter with resignation. She and her husband
have invested in their farm and in fact they are losing their farm, and
they wonder what to do next. She says, ``. . . I'm not sure if there is
a lot of need for a 38-year-old combine operator/tractor driver/
trucker/run for parts person and be a mother in the workforce in North
Dakota.'' That is what you do to run a farm. Everybody does everything.
Some, I guess, as the old saying goes, understand the cost of
everything and the value of nothing. That is what we have here, in my
judgment. We went through this debate a couple of years ago on the
Freedom to Farm bill and I was never made quite so despondent about a
U-turn in public policy as I was by those who said, ``Gee, family
farmers really don't matter very much. We have this market system they
can work in.''
Everybody here knows. The statistics I have just used are not foreign
to anybody here. They say to the family farmer: You operate in this
market system. We understand the grain trading firms have a hammerlock
on price; we understand the railroads have a hammerlock on your
transportation; we understand that meat packing plants have a
hammerlock on your marketing system, but, still, you go ahead and
operate in the free market.
I think it would be perfectly understandable for farmers to start
their tractors and gas them up and head them towards the byways and
highways that haul policy makers to legislative forums where they extol
about a free market that doesn't exist and see if they cannot persuade
them that family farming matters and that their futures and their
fortunes matter as well.
We expect in the coming weeks to have discussions about a disaster
program or an indemnification program, either one; about a price
support program; about a range of other issues that need to be
addressed, including the question of concentration in the meat packing
industry and other issues. But through it all, I expect we will debate
these issues in the month of July.
Now that the Senate will be back voting tomorrow, we will see work on
appropriations bills. Will we see business as usual? Will we see the
kind of legislative sleight of hand that I mentioned at the start of
this discussion? Will we see conference committees come to the floor of
the Senate in which a $2 billion item was offered in legislative
darkness that will butter the bread of the richest folks in America?
Then the same people who decide they want to do that will say, ``Gee,
we don't have enough money to help poor people who can't afford home
heating.''
We will see all that kind of thing that goes on around here because
people can do it, and they do do it, and that is unfortunate. That is
not the bright side of legislating. That is the dark side of
legislating. But, hopefully, enough of us will force enough of others
of us in this Chamber to confront these questions. Does farm policy
work when farmers are told that whatever they get in the marketplace is
all there is, and the marketplace collapses like a used accordion, and
the farmers are then told, well, it's tough luck; some big corporation
will come and farm all that land and America will be just as well off
with an agrifactory?
In my judgment, it won't. I recognize I come from a town of 300
people in a small rural area of North Dakota. But the people who farm
in North Dakota and up and down the farm belt are some of the best
people in this country. They don't deserve to be whipsawed by an
economic system that is unfair to them, that treats them fundamentally
unfairly with respect to trade agreements and sanctions, and markets
that are unfair, markets that are clogged. It is not the right way for
this country to treat its family farmers.
So, again, Mr. President, in the coming couple of weeks, the
leadership of the Senate should expect to confront these issues. I hope
those who feel strongly about the current farm policy will bring their
notebooks, bring their theory, and sharpen their chants, because they
are going to have an opportunity to tell us about free markets once
again. We will have an opportunity to visit about farm families who are
going broke under that very same set of circumstances.
Mr. President, I yield the floor.
____________________