[Congressional Record Volume 144, Number 106 (Friday, July 31, 1998)]
[House]
[Pages H6870-H6871]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             THE STATE OF UNITED STATES AGRICULTURE ECONOMY

  The SPEAKER pro tempore (Mr. Gutknecht). Under a previous order of 
the House, the gentleman from Minnesota (Mr. Minge) is recognized for 5 
minutes.
  Mr. MINGE. Mr. Speaker, I rise this afternoon to discuss the state of 
the agriculture economy and to report to my colleagues the results of a 
hearing that was held by the House Committee on Agriculture on 
Thursday.
  That hearing is the first hearing that we have held in the House 
Committee on Agriculture this session on the farm economy and how the 
1996 farm law, farm bill is responding to the crises that we face.
  I am pleased that we held the hearing. I regret, however, it has 
taken so long for us to focus on this problem.
  First, I would like to just urge that all of my colleagues recognize 
the severity of the problem that we face, and probably no State 
illustrates this better than North Dakota. The State of North Dakota 
has seen a 98 percent drop in farm income in the last 2 years. It is 
such a precipitous drop that in North Dakota and the Red River Valley 
portion of Minnesota just to the east, we see record numbers of farmers 
selling out, closing down their operations and saying, in this strong 
national economy, there is no reason why we should be continuing our 
farming operations.
  What I see, in the area that I represent in southern Minnesota and 
the Chair represents, is a looming crisis. It certainly is not as 
serious as what we face in the Red River Valley area, but it is one 
that has the potential of having a parallel dramatic impact.
  In the State of Minnesota at large, farm income is down 57 percent 
from the first quarter of 1996, compared to the first quarter of 1998, 
57 percent. Part of the reason that it is down is that in addition to 
the disease problems that are affecting wheat and barley in the Red 
River Valley area, we also have severe price depression for agriculture 
commodities.
  Wheat is selling in the neighborhood of $2.50 a bushel. This is a 
product that in some years is selling for $3 to $4 a bushel. Those 
would be the average years. At $2.50 a bushel, wheat can be used as a 
feed grain. Barley is being used as feed grain.
  This has an effect on the price of corn and soybeans. Corn is now 
selling in the Midwest for below $2 a bushel. For those of you that are 
not familiar with what that means to farmers, it means that you lose 
money, as much as 30, 40 cents on every bushel of corn that you market. 
Many say, well, if you have a good year, that just means that you are 
going to have a bigger yield and you can make more money.

  What farmers are facing is that the excitement of a bumper crop is 
being moderated and turning into a much more depressing situation, 
because the price is collapsing. What is more distressing is that the 
number of farm

[[Page H6871]]

families that are willing to maintain their farming operations is 
dwindling. Time after time, as I visit with families in Minnesota, I 
hear the common refrain, we have decided that with a good education, 
the young people that grew up on this farm ought to be pursuing a 
career in town. We do not think it is a good idea for them to try to 
continue farming.
  As one after another of these farming units disappears, what we see 
is a phenomenon that is altogether too common and too distressing. It 
is the collapse of a rural economy and of a rural way of life.
  Now, some may say that is just the way the market works. It is the 
wonders of the marketplace. But before I turn to a couple of things 
that we can do to try to respond to this and were discussed at the 
hearing, I would like to focus on the fact that the farm economy does 
not have the resiliency that some other parts of our economy have. You 
cannot downsize your operation quickly to respond to changing economic 
times. Your investment in fixed assets, land principally, but machinery 
is enormous. You have to use those assets.
  At the same time you have risks that are phenomenal, the risk of 
weather, of course, is familiar to all of us, but the risk of disease, 
such as they have suffered in the Red River Valley, the risk of markets 
such as the collapse of markets in Southeast Asia, which were the 
promising opportunities for American agricultural exports, all of these 
things combine to haunt agriculture.
  What is the response? Just in a couple of sentences, first, an 
emergency disaster package for crop insurance that is a bipartisan 
proposal; second, accelerating the payments coming under the Freedom to 
Farm Act, a partisan proposal; third, extending the marketing loan 
period, something we might have bipartisanship on; raising or uncapping 
the marketing loan program. These are a variety of things that were 
discussed.
  I recommend or urge my colleagues to look more closely at what is 
happening in rural America.

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