[Congressional Record Volume 144, Number 121 (Monday, September 14, 1998)]
[Senate]
[Pages S10283-S10304]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




  DEPARTMENT OF THE INTERIOR AND RELATED AGENCIES APPROPRIATIONS ACT, 
                                  1998

  The PRESIDING OFFICER. Under the previous order, the hour of 1 p.m. 
having arrived, the Senate will now resume consideration of S. 2237, 
which the clerk will report.
  The assistant legislative clerk read as follows:

       A bill (S. 2237) making appropriations for the Department 
     of the Interior and related agencies for the fiscal year 
     ending September 30, 1999, and for other purposes.


[[Page S10284]]


  The Senate resumed consideration of the bill.
  The PRESIDING OFFICER. The Senator from Washington.
  Mr. GORTON. Mr. President, we began debate on this Interior 
appropriations bill last Tuesday. The Senator from West Virginia, Mr. 
Byrd, and I each made our opening statements and a handful of agreed-
upon amendments were added to the bill at that point.
  Then we spent much of the rest of the week on an amendment relating 
to campaign finance laws and other subjects not related to the Interior 
appropriations bill. So no progress was made on this bill.
  Today, a number of Members on the other side of the aisle wish to 
offer an amendment related to agricultural policy. Of course, under the 
rules of the Senate, they have every right to do so. It is certainly 
appropriate to recognize them in the absence of a contested amendment 
dealing with the Interior appropriations bill.
  The majority leader wants all Members to know that there will be time 
for discussion of that amendment during the course of the afternoon on 
both sides, including the distinguished chairman of the Committee on 
Agriculture. But when that debate seems to be over, or at 5 o'clock, 
whichever comes first, the Senator from Indiana, the chairman of the 
Appropriations Committee, will move to table the amendment and will ask 
for the yeas and nays, and there will be a vote on tabling the 
amendment immediately after the vote that is already scheduled for 5:30 
this afternoon.
  With that notification, I yield the floor.
  Mr. HARKIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. DORGAN. Mr. President, let me inquire of the Senator from Iowa--
does the Senator from Iowa have the floor?
  The PRESIDING OFFICER. The Senator from Iowa has the floor.
  Mr. DORGAN. The Senator is going to offer an amendment on our behalf 
and on behalf of the Senate minority leader. My expectation is Senator 
Gorton would like to provide an opportunity for the minority leader to 
speak before the vote. I don't know if he made a unanimous consent 
request. I hope, in any event, if there is a discussion of time with 
respect to the tabling of this amendment, that there is an 
understanding the minority leader will be given time to speak prior to 
the tabling motion.
  Mr. GORTON addressed the Chair.
  The PRESIDING OFFICER. The Senator from Iowa has the floor.
  Mr. HARKIN. I yield without losing my right to the floor. I obviously 
yield to the Senator from Washington.
  Mr. GORTON. At 5 o'clock, under the previous order, we are to go back 
to another bill, on which we will vote on cloture on the motion to 
proceed at 5:30. It is the present intention of the majority leader to 
have a vote on tabling this amendment immediately after that 5:30 vote. 
I am sure that the majority leader will want to give the minority 
leader an opportunity to speak to the issue, however, beforehand. That 
is something they can negotiate with one another, but I see no problem 
in letting the minority leader speak.
  Mr. WELLSTONE. Mr. President, may I ask my colleague one question?
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. HARKIN. I yield to my friend from Minnesota without losing my 
right to the floor.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. WELLSTONE. Absolutely. I thank the Chair. I guess it is an 
indirect question for other colleagues as well. I put it in the form of 
a question to my colleague from Iowa.
  While I understand the need for some sort of time agreement, does not 
the Senator from Iowa agree with me that we have an economic convulsion 
in agriculture right now and this is an issue of central importance to 
many Senators from the Midwest? I ask my colleague from Iowa if he 
thinks, in all due respect to the majority leader, that we are 
marginalizing or trivializing this issue by saying that it is going to 
be tabled at 5 o'clock? Some Senators may not even be back here--not 
just Senator Daschle from South Dakota--without the opportunity to 
speak about this issue.
  Does my colleague think maybe it is a mistake not to allow other 
Senators to speak on this? This is not a small issue--am I correct?--in 
our States. Doesn't this issue deserve the full attention of the Senate 
or full opportunity for a full debate? And does my colleague not have 
some concern that by having a tabling motion sometime around 5, that a 
good many Senators are not going to be able to speak on this question, 
this urgent question?
  Mr. HARKIN. I respond to the Senator from Minnesota to say I agree 
with him absolutely, there is a convulsion going on in agriculture 
today. We are spiraling into a deepening crisis in agriculture all over 
America, especially in the Midwest. Yes, this issue is of vital 
importance to farm families and people in rural areas all over America. 
I do believe we have to take some time to lay out the case and to lay 
out the facts of what is happening in agriculture today.
  My colleague from Minnesota, I know, will do that today. My colleague 
from North Dakota, and others, I am sure, will want to come on the 
floor. The Senator from Minnesota is right, it is a Monday. People were 
told there would be a first vote today at 5:30. So I assume a lot of 
Senators are now returning to Washington, such as the case with the 
minority leader, Senator Daschle.
  I hope, since we are taking some time this afternoon--let's be honest 
about it, there is not much happening on the floor of the Senate today. 
I don't see anybody lined up with amendments. So we are taking this 
time to talk about and discuss the parameters of the problem in 
agriculture and to lay down our amendment, of course. But I hope that 
we will at least have some time beyond 5 or 5:30 this evening, maybe 
even tomorrow, to have some further discussion on the crisis in 
agriculture.
  The Senator from Minnesota I think is absolutely right. I am sure 
there are a lot of Senators who would like to say something about this 
and to maybe add their thoughts, their views, their perceptions, their 
support. Or perhaps there are those who don't want to support doing 
anything at all but to just let it go, and they have a right to speak 
here, too, and they should be heard also.
  I am hopeful that, as the Senator from Minnesota has pointed out, the 
floor manager of the bill and the majority leader of the Senate will at 
least afford us some valuable opportunity for other Senators to come in 
and speak on this bill after their return to the Senate Chamber.
  Mr. WELLSTONE. May I ask my colleague one more question?
  Mr. HARKIN. I yield for a question.
  Mr. WELLSTONE. And I will let my colleague go on with his 
presentation. I know there are a number of Senators who want to speak, 
myself included.
  I ask the Senator from Iowa this question, again, making the appeal 
to the majority leader: Doesn't this also go to the heart of 
accountability? Isn't it true people in Iowa, Minnesota, the Dakotas, 
throughout the Midwest, and, for that matter, throughout the country as 
well--let me focus on our States--as my colleague from Iowa thinks 
about it, don't people back in our States have the right to know where 
we stand? Don't they have a right to know whether or not their Senators 
have been out here on the floor making proposals--positive proposals--
about what could be done that speaks to their economic pain one way or 
the other? Doesn't this whole issue before us speak to the issue of 
accountability?
  If we have a tabling motion at 5 or 5:30, albeit the minority leader 
absolutely has to speak, doesn't this take away from the very idea of 
accountability, where people will wonder, where were our Senators, why 
didn't they speak up for us, or why didn't they have other alternatives 
if they didn't like this amendment? Don't we really undercut the very 
notion of accountability and what we are about by rushing to a tabling 
motion on such an urgent matter, such a central issue, something that 
is so important to people in our States?
  I feel some indignation about this. This is not the way to proceed. 
For me, this is the issue. What is happening in Minnesota in 
agriculture is the issue. I just don't see a couple of hours, table, 
goodbye, that's it, one way or the other.

[[Page S10285]]

  Mr. HARKIN. I agree with the Senator, this is a matter of 
accountability. Senators should have the right to speak, but they 
should also have the right to cast their vote one way or the other, up 
or down, on the amendment.
  So I am hopeful that there would not be a tabling motion, that in 
fact we would be able to vote up or down on the package of amendments 
that I will soon be offering on behalf of Senator Daschle and the 
Senator from Minnesota, the Senator from North Dakota, and several 
others. But they should have the right to vote on that up or down. I 
think our constituents, as the Senator pointed out, they have the 
right. We have the obligation. They have the right to demand that we 
vote up or down on whether we are going to take some meaningful steps 
to alleviate the situation in agriculture.


                           Amendment No. 3580

  (Purpose: To provide emergency assistance to agricultural producers)

  Mr. HARKIN. Mr. President, I will soon be sending an amendment 
forward, but I thought I would speak on it before I do. Then I will 
yield to my colleague from North Dakota, who I know wants to speak, and 
my colleague from Minnesota. But I would like to take just a few 
minutes again to talk about the grave economic situation in rural 
America.
  I just remind my colleagues in the Senate, that the Senate voted 
unanimously in July on my resolution describing the terrible conditions 
in agriculture and calling for immediate action by Congress and the 
administration. That passed the Senate unanimously. Unfortunately, a 
little bit later, when the Senate had a chance to pass a measure to 
provide some assistance, we did not manage to assemble the necessary 
votes. That was in late July before we left for the August recess. I 
am, however, encouraged by some information I have become aware of that 
attitudes toward what we proposed in July may have changed. So I am 
hopeful that today we will be able to pass this critically important 
legislation to provide emergency farm income assistance to farm 
families. I see no reason why we cannot pass it in the bipartisan 
tradition that has customarily been the hallmark of agricultural 
legislation.
  If there was any doubt about the seriousness of the situation and the 
need for taking action in July, there can be no doubt today that the 
situation has worsened and that the urgency of the need for a response 
has increased.
  Mr. President, I used these charts last week. Unfortunately, they are 
still valid this week. But I just want to point out that since we first 
debated this in July, on July 17, when there seemed to be some sense on 
the Senate floor that we were not really in a crisis situation in 
agriculture, that since July 17, we have had a 21-percent decline in 
the corn price--we used central Illinois as an indicator--and the 
prices keep on dropping.
  As a matter of fact, I point out that just late last week the 
Department of Agriculture revised their crop estimates for corn, and we 
are going to have even more corn than we thought we were going to have. 
So we see that about every time a new estimate comes out, we get closer 
and closer to 10 billion bushels of corn; and that drives the market 
price down. The same thing happened with the soybean price. We had an 
equivalent 21-percent decline in the prices. Again, they are still down 
there.
  Since July 16, when we passed here the version of our agricultural 
appropriations bill: Dodge City, KS, wheat down 20 percent; north 
central Iowa corn down 26 percent; southern Iowa/Minnesota market hogs 
down 11.6 percent. In fact, in hogs we are looking at the lowest prices 
for hogs since 1974--almost 25 years. Billings, MT, feed barley down 20 
percent. Kansas City hard red winter wheat down 13 percent. As I 
understand it, it is still going down.
  We can see what has happened since we passed the farm bill. You see 
what happened. We had a couple years here of increasing prices, exports 
were going out, customers overseas, the Asian economy was booming. So 
we passed the 1996 so-called Freedom to Farm bill, but then everything 
just started going to pot.
  Look at what our prices have done since then. We are on a constant 
decline and a sharp decline in commodity prices since that period of 
time, all in corn and in soybeans and in wheat. All three of them, ever 
since the 1996 farm bill, keeps coming down. That little red line 
indicates just what happened in the last several weeks.
  So if there ever was any doubt in anyone's mind of the crisis in 
July, there can be no doubt any longer. And prices, unfortunately, are 
certain to fall even more at harvest. We are facing the reality of a 
very serious economic hardship, all around the Nation.
  And let me just underscore this: This is not the fault of farmers. We 
have a world situation where large supplies of commodities have 
combined with weakened demand to drive these commodity prices lower. In 
just the past 2 years, the farm-level prices for corn, wheat and 
soybeans have declined an average of over 50 percent in 2 years; and 
cattle prices, 20 percent below their level earlier in the decade. As I 
said, hog prices are at their lowest level since 1974.
  On top of that, many regions--North Dakota, parts of Minnesota, 
Oklahoma, Texas, Louisiana--several regions, we have had bad weather 
and/or crop disease that have devastated farmers. Thirty-two of 50 
States suffered declines in personal farm income between 1996 and now.

  USDA price estimates are that the lower corn and soybean prices will 
cause a loss in farm income of $1.4 billion in Iowa alone this year. 
Such a loss would threaten up to 26,000 jobs in my State. Nationally, 
USDA now predicts a precipitous drop in farm income of $11 billion this 
year. That loss of farm income could result in a loss of over 207,000 
jobs. Farm debt is at the highest level since the mid-1980s in the 
depths of the farm crisis at that time.
  So, Mr. President, use whatever yardstick of measurement you want. By 
any measurement, we are spiraling into a deepening crisis in 
agriculture that must be stopped--and stopped now--before it gets any 
worse.
  So today what we are proposing is a package that has four main 
elements. No. 1, we propose to remove the caps on loan rates that were 
put into effect in the 1996 farm bill and to allow the Secretary of 
Agriculture to extend the loans from 9 months to 15 months.
  The way that loan rate would work is that you would take the average 
price over the last 5 years, drop out the high and the low, take the 
average, and 85 percent of that would be the loan rate.
  No. 2, we propose to ensure that enough money is available for 
indemnity compensation to farmers who have suffered losses from weather 
and disease.
  No. 3, we propose to provide the Secretary of Agriculture the 
authority to make storage payments on wheat and feed grains in order to 
encourage producers to place surplus commodities under loan when the 
Secretary determines that such action is appropriate to respond to 
problems in the transportation and marketing systems caused by large 
supplies.
  No. 4, we are reiterating our commitment to livestock price reporting 
and to the labeling of imported beef and lamb. Parts of this were 
passed before, but we do not know if that bill is ever going to see the 
light of day. So we are offering it again on the Interior 
appropriations. For example, on the livestock reporting and the 
labeling of imported beef and lamb, those two were passed before. 
Indemnity compensation was passed before, but at much too low a level. 
We now know that the losses are much higher than what we anticipated in 
July.
  We believe we have crafted a responsible and modest package to 
respond to the deepening crisis in rural America. We are not proposing 
any radical change to the 1996 farm bill. We are not changing any 
fundamental principles of the 1996 farm bill, which was to give farmers 
new planning flexibility and freedom. We are not touching that aspect 
of the 1996 bill.
  We are simply modifying something that is already in the bill. Loan 
rates are part of the 1996 legislation. It is just at that time the 
wisdom of the Congress--I voted oppositely--was to put caps on the loan 
rates and to freeze them at the 1996 level. All we would simply do is 
modify that and lift the caps for the loan rates--use the existing law 
but just take the caps off, but use the existing law--which would allow 
the Secretary to extend the loan periods and to make storage payments.

[[Page S10286]]

 Again, we are not introducing new features. We are simply taking the 
caps off these loan rates.

  Our amendment focuses on the level of the loan that these farmers can 
take out on commodities after harvest, using their crops as collateral. 
The loan allows the farmer to pay bills, retain the crop while waiting 
for improved marketing opportunities.
  We always heard about Freedom to Farm that allows families the 
flexibility to plant, but what the farmer this year doesn't have is the 
flexibility to market. Because of the need to pay bills, the farmer 
most often this fall will have to dump the grain on the market at the 
lowest possible price.
  What extending the loan rates and raising the caps means--the farmer 
can take that loan out, and if the Secretary determines that they 
should make storage payments, they get storage payments also and the 
farmer can take the grant--the loan rate that he has--pay the bills, 
and then he can market his grain, market his grain when he feels is the 
right time, not just when he is forced to dump it on the market this 
fall.
  We all hope, of course, that next year grain prices might recover, 
the Asian economy might get better, and prices might come up. If so, I 
want the farmer to reap the benefits of that, and not just the large 
grain companies.
  The formula, as I said, has been around for a long time. I mentioned 
the formula; I don't need to go through that again. I will give a 
couple of examples. The 1996 farm bill set as a cap on the loan rate 
$1.89 a bushel; if the cap were removed, the loan rate would be about 
$2.17 for the 1998 corn crop--modest, very modest, but it would really 
help. In the case of wheat, the loan rate capped at $2.58 a bushel; 
removing the cap put it at $3.16 a bushel--still much too low for a 
real market price for wheat but, again, a modest increase that would 
help our wheat farmers.
  In addition, as I said, our amendment would allow the Secretary to 
extend the loan for an additional 6 months--from 9 to 15 months--again, 
to give the farmers some more marketing flexibility.
  Let me say a word about giving the Secretary the ability to make 
storage payments. The purpose of the storage payments is to facilitate 
orderly marketing, to alleviate burdens on commodity transportation and 
marketing systems. As we have seen in recent months, large supplies of 
commodities place a huge stress on the transportation system and on the 
entire commodity marketing and merchandising system. If farmers place 
some of this surplus grain into storage rather than dumping it into the 
market at harvest time, there will be some relief from the pressures on 
the grain transportation and marketing system.
  Again, keep in mind that we are making this discretionary with the 
Secretary. He can look at the situation as it develops. If it looks 
like we will have a lot of grain sitting on the railroad sidings with a 
backup in cars and we won't be able to get our grain out to market and 
the prices keep going down, he could then extend some storage payments 
to farmers.
  Again, we are not changing any of the planting flexibility of the 
1996 bill or anything like that.
  Now, I will just close on this note and say there seems to be some 
misconception that our amendment involves ``Government intrusion'' into 
the business of farmers--that we are going to put the Government back 
in farming. Nothing could be more mistaken. In fact, we are enhancing 
the ability of farmers to market their commodities when it is most 
advantageous for them to do so. I know the old refrain about keeping 
the Government out of agriculture, giving the farmers more freedom. 
That is what we are doing. We are giving them more freedom in our 
amendment, more freedom to be able to market their crops.
  Again, this is a modest approach, one that shouldn't cause any real 
discomfort among those who so strongly adhere to the 1996 farm bill and 
who believe that we shouldn't make any changes in it. I happen to be 
one of those who did not vote for the 1996 farm bill. I thought it was 
a good farm bill for when the export demand is high; when there is a 
lot of money overseas, it is fine; but when those markets disappear, as 
they always do cyclically, the farmer is left holding the bag. There is 
no safety net for farmers.
  President Clinton said at the time he signed the farm bill that he 
was doing so but he recognized that the safety net was taken away and 
we would have to come back and modify it at some future time. Well, now 
is the time to take the loan rate caps off and to send a strong message 
to farmers that we, indeed, recognize the disaster that is taking place 
out there.
  I spent the weekend in my State of Iowa. I had a meeting with a farm 
advisory committee. There are some people on the committee who are 
bankers, farmers, commodities dealers, and they stated, to a person, if 
something is not done this fall, it will be too late next spring. It 
will be too late to save a lot of farmers. It will be too late to do 
something about the spiraling down and the economic effects that this 
will have on all of our businesses in rural America come next year if 
we don't do something right now.
  I see a lot of my colleagues on the floor who would like to speak, so 
I send my amendment to the desk on behalf of Senator Daschle, myself, 
Senator Johnson, Senator Kerrey, Senator Conrad, Senator Baucus, 
Senator Dorgan, and Senator Wellstone, and ask for its immediate 
consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Iowa [Mr. Harkin], for Mr. Daschle, for 
     himself, Mr. Harkin, Mr. Dorgan, Mr. Johnson, Mr. Kerrey, Mr. 
     Conrad, Mr. Baucus, and Mr. Wellstone, proposes an amendment 
     numbered 3580.

  Mr. HARKIN. I ask unanimous consent reading of the amendment be 
dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The text of the amendment is printed in today's Record under 
``Amendments Submitted.'')
  Mr. HARKIN. I yield the floor.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. DORGAN. Mr. President, I listened carefully to the comments by 
Senator Harkin from Iowa. I have spoken over the weekend, again, with 
Senator Daschle, on whose behalf we offer this amendment. A group of us 
have joined together, believing it is urgent that we respond to the 
farm crisis and that we do so quickly.
  I want to go through a couple of charts, just briefly, that describe 
what this crisis is about. The first chart goes back to April 1996 and 
shows what has happened to farm prices. Wheat prices have fallen from 
$5.75 per bushel down to $2.46. The price of wheat, in this case, 
dropped 57 percent in this nearly 2-year period, since the farm bill.
  Now, I ask people to think of their own situation. If their income 
dropped 57 percent, what shape would they find themselves? That is what 
has happened with family farmers. At the same time the price of their 
inputs have grown, and increased dramatically. The price of their grain 
has collapsed. In my State of North Dakota, in 1 year, net farm income 
for family farmers dropped 98 percent. Anyone in this country, any 
neighborhood, any community, any business, would be in desperate 
trouble if they lost 98 percent of their income, and yet that is what 
has happened to our family farmers.
  When historians look back at this period, they will say that this is 
one of the most significant farm crises that we have faced since the 
Great Depression. We, in fact, have Depression-era prices for grain in 
rural America right now. We won't have many family farmers left if this 
Congress doesn't extend a hand to help out when family farmers are in 
trouble.
  Each month has brought more and more bad news for family farmers. 
Wheat prices have fallen an average of a 11-cent-a-month drop during 
this entire year. That amounts to an almost $40 million income loss 
each month to North Dakota farmers.
  I want to read a letter from a 15-year-old high school boy who comes 
from a family farm. He wrote me a letter that I received in recent 
days.

       My name is Wyatt Goettle.

  Incidentally, he told us we should go ahead and use his name. Wyatt 
says:

       I live on a farm by Donnybrook [in North Dakota], and we 
     raise sheep, cattle, and grow crops. I'm 15 years old and I'm 
     a sophomore at Stanley High School.
       This year we rented out most of our cropland. The prices of 
     crops this year and in

[[Page S10287]]

     past years is ridiculous. What would happen if all the 
     farmers just quit because they couldn't even feed their 
     families? I don't know what is going on, but somebody 
     somewhere is making money and it isn't the farmers that put 
     all the work into it.

  Then he says this:

       You know, my dad can feed 180 people, but he can't feed his 
     own family because of the prices.
       . . . Our farm is a small family farm and it's hard to keep 
     going . . . It's hard getting back from school and working 
     until 10:30 or 11:00 at night. Then having to get up at 6:15 
     the next morning just to find out that you can't put gas in 
     the car to go to school because you can't afford it. It all 
     goes back to the beef and grain prices.

  This from a 15-year-old boy, a sophomore attending school in Stanley, 
ND.
  Let me read an additional letter from Brian and Johnet Christianson, 
who wrote to me recently from Glenburn, ND. She said:

       Our loan officer has told us this will be our last year of 
     farming if we can't make our scheduled payments. We want to 
     farm. I have a good job, and my husband has taken on a full-
     time job and a part-time job [off the farm] to make ends 
     meet. That is to cover living expenses.
       . . . The public keeps hearing about the family farmer, but 
     what about the farmer's family? The wife tries to be a 
     decision-maker with her husband to pay a bill or get 
     disconnected; or put food on the table. The wife is there to 
     give a smile and a hug when he comes in from the field. As a 
     new school year is getting underway, it is the farmers' 
     children who continue to suffer the misfortunes of the farm 
     life. Don't get me wrong. We have chosen this life for our 
     family, and we will fight to keep it going.

  She said:

       When mom offers to buy one pair of new school jeans, it is 
     the daughter who says, ``No, mommy, I don't need them because 
     we [can't afford it], right, mommy?'' As I fill out reduced 
     or free school lunch applications, the farm has brought us 
     $72 a month this past year. Yet people think we are rich 
     farmers who can handle a bad year.
       . . . Brian and I have a very strong marriage and we will 
     get through this year with hope for a better tomorrow. Our 
     children will, too. We will make it--the optimism of the 
     farmer.
       Please continue to fight for equity in grain prices for the 
     farmer and his family.

  Now, these two letters--one from a husband and wife and one from a 
15-year-old boy--describe this crisis better than I can describe it. 
The young 15-year-old boy, a sophomore in high school, says:

       My dad can feed 180 people, but can't feed his own family 
     because of farm prices.

  There is something wrong with that. One fellow sent me something that 
I ask unanimous consent to be able to show on the floor of the Senate. 
It is a handful of grain.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. If I might, I will show my colleagues that this is the 
barley he sent to my office a couple of days ago. Then he sent a 
similar bag of kitty litter. This kitty litter is worth 20 cents a 
pound, and the barley is worth 2 cents a pound. This farmer said, ``Is 
there something wrong here? Kitty litter is 20 cents a pound and barley 
2 cents a pound. Am I missing something?''
  No, he is not missing something. There is something fundamentally 
wrong with grain prices. There is something wrong when we say to the 
world and to family farmers that what they produce has no value. What 
they produce has no worth?
  I have said this before on the floor of the Senate and we have heard 
it in testimony of people. Halfway around the world, old women are 
climbing trees in Sudan to scour for leaves to eat because they are 
facing starvation. A million and a half people in Sudan are starving 
halfway around the world. At the same moment that an old woman is 
climbing trees to get leaves to eat, a family farmer loads up his truck 
to drive to the elevator with a load of hard red spring wheat. When he 
gets to the elevator, he is told, ``This wheat doesn't have much value; 
it is not worth much.''
  Is there a disconnection here? I think so. We produce an abundant 
quantity of food that the world needs, but somehow we cannot get to 
halfway around the world where they need it. Those who need it can't 
get it and those who produce it are told it has no value. If you want 
to talk about a disconnection of things that are really important on 
this Earth, that is it.
  Now, we passed a new farm bill a couple years ago. I didn't vote for 
it. I didn't believe the farm bill was the right approach. I still 
don't. Like so many political promises, that farm bill had big print 
and it had little print. Unfortunately, as is often the case, the big 
print giveth and the little print taketh away.
  Now, the big print promised that price supports would be set based on 
marketplace prices. Loan rates would therefore be 85 percent of the 
Olympic 5-year average of prices on the market. This promised a price 
cushion for family farmers. If market prices fell, there would be a 
cushion set at 85 percent of the Olympic 5-year average price. That was 
the big print.
  Now here comes the little print. The little print then said that what 
the big print said was wrong. The little print said that while loan 
rates were supposed to be based on market prices, the little print put 
a cap on it. That is an innocuous little word, that three-letter word--
``cap.''
  So the big print says you get 85 percent of the Olympic market 
average, and we are going to give you that as an opportunity to provide 
some kind of price support so that if the market collapses, you have 
something to support you. But then the little print comes back and 
says, ``Oh, by the way, we are not going to give you what you were 
promised; we are going to put a cap on it; and therefore your support 
prices are pathetic.'' They never use the word ``pathetic''; they put 
the cap on it that made it pathetic. Now we find ourselves under 
circumstances where we must come to the floor and say let's take the 
cap off the loan rate and give farmers what they were promised in the 
farm bill.
  All we want to do is delete just a part of the little print. Our 
amendment would just delete a part of that little print in the farm 
bill. Why, you would think we were burning 85 barns down with all the 
commotion about this. We come and say, ``Let's delete the little print 
that took away from farmers what the big print promised,'' and you 
would think we were burning barns down.
  Holy cow, people are jumping up and down and screaming that we are 
going to unwind, unravel, and tear apart the farm bill. No; we are just 
going to make the farm bill honest. We are trying to make it do for 
farmers what the farm bill promised it was going to do for farmers. If 
making that bill honest is the wrong direction, then I guess I have 
lost part of the compass by which to measure these issues.
  Well, let me show the second chart. It describes part of the problem 
that cries out for attention. The red and orange areas are counties in 
our State. This is the State of North Dakota, which is 10 times the 
size of the State of Massachusetts, just for some land mass 
comparisons. This whole area of the State has been declared as an 
agricultural disaster. One third of our counties have been declared a 
disaster every year for the last 5 years. That's right; every single 
year. Two thirds of our counties have been declared disaster areas in 3 
of the last 5 years. Why? It is because of a wet cycle that came and 
stayed, and provided the conditions for the worst crop disease in a 
century. And, now we have collapsed grain prices on top of it.
  Now, farmers can't make it when, year after year after year, they 
have recurring natural disasters. That is exactly what has happened. It 
is precisely why, if we are going to save the family farmers, we must 
take action now to deal with this issue.
  One of the problems that came from these wet cycles and all of the 
other natural disasters is a crop disease called fusarium head blight, 
which is a fancy way of saying scab. Farmers know what scab means. It 
means money is sucked right out of their pockets by decreased grain 
quality and quantity. Brian Steffenson, a cereal scientist from North 
Dakota State University, said:

       Make no mistake about it. This is the worst plant disease 
     epidemic that the U.S. has faced with any major crop during 
     this century.

  Our family farmers face collapsed prices, the worst crop disease of 
the century, disaster declarations year after year in most of the 
State. Yet, North Dakota, which is a rural State, is an important part 
of the bread basket in this country.
  Let me add one additional chart which shows another part of the 
problem. As if this situation is not bad

[[Page S10288]]

enough with bad prices, poor crops and crop disease there is another 
economic dilemma facing our farmers. When the farmer does produce a 
product, the farmer faces basic monopoly pricing or monopoly influences 
up the marketing stream.
  Want to sell some beef? Well, then, show up at the packing plant and 
you will find that 87 percent of the beef packing is controlled by four 
firms. Eighty-seven percent of the cattle slaughtered in this country 
is controlled by four firms. How about pork? Sixty percent of pork 
slaughter is controlled by four firms. Fifty-five percent of broiler 
chicken processing is controlled by four firms. Do you have sheep to 
send to the market? Well, 73 percent of sheep slaughter is controlled 
by four companies.
  Everywhere a farmer turns, as he sells his commodities up the 
marketing stream, he finds that it is controlled by monopolistic kinds 
of enterprises.
  How about transportation? Take it to the railroad, and what do you 
find there? Competition? No. You find one railroad that says, ``We will 
haul your wheat, and here is what we charge you. If you don't like it, 
tough luck. Try walking down the highway carrying your wheat to market 
in gunnysacks.''

  In North Dakota, when you want to ship your wheat from Bismark to 
Minneapolis, MN, the railroad charges a farmer $2,300 to ship that 
carload of wheat. But, if you put that carload wheat on in Minneapolis 
and ship it to Chicago, which is about the same distance, they don't 
charge $2,300. They charge $1,000. Why do we get charged more than 
double? Because there is only one railroad. And they say, ``Here is 
your price. If you don't like it, tough luck.'' So we pay too much 
money for transportation.
  My point is that in every direction the family farmer is confronted 
not by a free market but by a controlled market--controlled in someone 
else's interest. That is the dilemma we face.
  At some point in agriculture, we reach a point of no return. The 
question for this Congress is whether we care enough about the future 
of family farmers in America to take effective action. Do we want to 
save family farmers? We can decide not to do that.
  The best way to decide not to do much about family farming is to 
essentially say the farm bill passed by Congress was just fine. We can 
say it is all right that the big print giveth and the little print 
taketh away. Well, I don't think that is just fine. I think it is 
critically important to save family farmers.
  If this country believes that food is expensive these days, they 
ought to try buying food once corporate agrifactories farm America from 
California to Maine. Then they will find out what the price of food 
really is. It won't be cheap food. It will be expensive food for the 
American consumer.
  This last chart shows a cartoon from one of our newspapers. There is 
nothing very funny what we have been discussing. This cartoon tells the 
story of agriculture in our region. It shows ``Family Farmers: The 
Point of No Returns.'' It describes the roadbed our farmers are 
traveling. That roadbed is made up of low yields, low market price, low 
cattle prices, high production costs, crop disease, bad weather. Our 
farmers have no returns on their production and now are on the point of 
no return.
  When I talked about transportation costs earlier, I should have also 
mentioned that there are many other business stories of what family 
farmers are facing.
  My colleague from Minnesota is ready to speak. He comes from the east 
of North Dakota, Minneapolis, MN. Did you know that if a North Dakota 
farmer is going to ship his or her grain on a rail bed, put it in a car 
and ship it on the railroad, that the same railroad that will ship a 
carload of wheat from Iowa all the way up through North Dakota and then 
to the West Coast for less? That's right shipping from Iowa up through 
Minneapolis, through North Dakota to the West Coast will be cheaper to 
than to load the grain on in North Dakota and ship it from North Dakota 
to the West Coast? Why? Because shipping from Iowa is a circumstance 
where you are shipping where there is competition at the point from 
which you start to ship it. The railroad will charge more money for 
fewer miles to North Dakota farmers to ship that same load of grain.
  My point is, it doesn't matter where you intersect this farm problem. 
In every single instance you will find out that there are no free 
markets; not in transportation, chemical prices, slaughterhouses, grain 
markets, you name it.
  I haven't yet even mentioned the unfair trade that comes from Canada 
and elsewhere that undercuts our farmers' markets and further collapse 
farm prices. This is in addition to all of the other things I have 
mentioned. Right now, as I speak, somewhere up in a border port between 
Canada and the United States there is an 18-wheel truck driving up. And 
the driver is leaning out with his left elbow telling some Customs' 
inspector, ``Yes. I have Canadian durum on the back of this truck. I 
have got a load of Canadian durum.'' He is going to drive that Canadian 
durum into the United States, undercutting our market, and thus taking 
the money right out of the pockets of American producers.
  How is he going to do it? Because the grain on his truck was sent by 
the Canadian Wheat Board, which is a monopoly. It is a state-sponsored 
monopoly that would be illegal in the United States of America. The 
durum wheat that he is hauling is sold through the Wheat Board at 
secret prices, which is not something that can happen in this country, 
either. So we have a state monopoly from Canada selling at secret 
prices in this country to undercut our farmers' price. It is 
fundamentally unfair.
  While that truck comes across today, we have trade officials who just 
sit on their hands. They see nothing, they do nothing and they say 
nothing. In fact, they ought not be there when the paychecks come out. 
We ought to save the money. Why have a trade office that doesn't have 
the energy to get up in the morning and suit up, with the notion that, 
``I am going to do something good''? I will have more to say about that 
this week.
  Right now my sense is we have trade people who have an unwillingness 
to take action. I say get rid of them. Get rid of all of them, and do 
it now. I am at my wit's end with our trade officials, because they 
know in their hearts that all they have is this mantra of free trade. 
They ought to really have some cymbals on the street corner someplace 
and just chant all day. That is all they do is chant. They certainly 
don't do any effective work with this country. If they did, they would 
be at the borders deciding that when people come into this country 
unfairly to try to undercut our markets and dump in this country at 
secret prices that there ought to be sanctions for that. As I said, I 
will have more to say about our trade officials later this week.
  But I am here today for a very specific reason. Between now and 
several weeks from now when this Congress adjourns, there isn't a more 
important agenda item for us to complete than to deal with the farm 
problem. I hope we can do it together. I hope that Republicans and 
Democrats coming from farm country are able to stand together and say, 
``We want to do something to help family farmers get over this price 
depression.''
  When prices drop and you have a price valley, we need to build a 
bridge across that valley. That is what this farm program this Congress 
passed was supposed to do. But, as I said, the promise was in the big 
print and the small print took that away. Shame on the small print. 
What we propose to do is dump the small print today and give family 
farmers the kind of support that is necessary to get across these price 
valleys.
  Let me finish as I started by telling you about Brian and Johnet 
Christianson. This is just one farm family--one couple living on a 
farm--that is representative of thousands and thousands of farmers 
across the region. They say, ``This will be the last year for us, our 
loan officer tells us, if we can't make scheduled payments.'' They ask 
a question. When their prices drop 57 percent and they are getting more 
than $2 a bushel less for their grain than it cost them to produce, how 
can they possibly be expected to meet their payments?
  There are no better people in this country than our farm families. I 
am not judging who is best. But, certainly there is nobody better folks 
in this

[[Page S10289]]

country than those people who went out and homesteaded the land, built 
themselves a house, raised a family, and operated a family farm. There 
are no bigger risk takers in America than those who plant the seed in 
the spring, and borrow some money to do it. They put everything they 
have, their sweat, their blood, their tears, everything they have into 
it. They risk everything they have every year. Then they hope that the 
insects don't come, it doesn't rain too much, that it rains enough, it 
doesn't hail, hoping their crop grows. And, when it grows, they hope 
that if they can harvest it and get it to the elevator, they hope among 
hope there is some kind of price that will give them the opportunity to 
make a living.
  All of us know in our hearts that those folks are out there crying 
tears tonight because they are losing their hope and they are losing 
their dream of wanting to continue a family farm for themselves and 
their children.
  We know what is happening to these people in those farm houses that 
Brian and Johnet talk about it. This mother says she is only able to 
buy her young daughter one pair of new jeans for the school year, and 
her daughter says, ``No, no, that is all right; I know we can't afford 
that.'' We know that in those houses they hope tonight that this 
Congress will do the right thing.
  Congress extends itself to say to everyone around the world whenever 
there is trouble, ``We are off rushing to help.'' What about now, here 
at home on the family farm, where there is trouble? Shouldn't we begin 
to rush to help with some real assistance that gives these farm 
families the hope of surviving for another day, another year, and an 
opportunity to say, ``I am a family farmer, I am making a decent living 
on the family farm, and I am proud of it.'' If at the end of the day, 
together we do what we can and should do to make things right for 
America's family farmers, we will give these people on our family farms 
the opportunity to be able to say that with dignity and pride.
  I yield the floor.
  Mr. WELLSTONE addressed the Chair.
  The PRESIDING OFFICER. The Senator from Minnesota.
  Mr. WELLSTONE. Mr. President, let me, first of all, thank my 
colleague, Senator Dorgan from North Dakota, and also Senator Harkin 
from Iowa.
  I think that it is not just a matter of--I think my colleague, 
Senator Dorgan, will agree with me--of coming to the floor and giving a 
speech.
  This is all so real to us. It is very concrete. This is the issue.
  Mr. President, I ask unanimous consent that a letter which was sent 
to me from Wally Sparby, who is the Minnesota State director of our 
Minnesota Farm Service Agency, be printed in the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                         USDA Farm Service Agency,


                                       Minnesota State Office,

                                 St. Paul, MN, September 10, 1998.
       Hon. Paul Wellstone: During our 1998 loan season, we 
     approved loans based on $4.00 per bushel for wheat and $2.55 
     to $2.75 for corn.
       Now the farmers are receiving from $2.50 to $2.70 for their 
     wheat in the market place and $1.42 to $.52 per bushel for 
     their corn--this just does not sustain cash flow!
       1. The one thing Congress can do that will help farmers 
     with cash flow today, more than anything else right now, is 
     to take the caps off the loan rates!!
       That will, on the average, immediately pump 60 cents a 
     bushel into the wheat and 30 cents a bushel into the corn.
       2. A Consumer Assurance Reserve should be established to 
     provide for a plentiful food supply in the interest of 
     National security. Store it on the farms and pay them the 
     same rate as commercial storage!
       3. Storage should have a two year rotation.
       4. Extend the Marketing Loan Program to 18 months.
       Senator, I'm also sending you a copy of our Minnesota State 
     Committee deliberations from their South Dakota meeting two 
     weeks ago.
       Hope these items can be of some value to you. If I can be 
     of further assistance, please feel free to contact me.
     Sincerely,
                                                      Wally Sparby
                                 MN State Executive Director, FSA.

  Mr. DORGAN. Mr. President, will the Senator from Minnesota yield?
  Mr. WELLSTONE. I would be pleased to yield.
  Mr. DORGAN. Mr. President, I understand that the unanimous consent 
request I am going to ask for has been agreed to by both sides.
  I ask unanimous consent that no amendments be in order to the pending 
Harkin amendment prior to a tabling vote.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. Mr. President, if the Senator from Minnesota will yield 
further just for a question before he begins his address. I understand 
that this coming Saturday in Worthington, MN, there is to be a farm 
rally, which I assume the Senator will be speaking about. The rally is 
in his home State, but it is a rally designed to encourage farmers from 
a four-State area to come together to talk about and demonstrate the 
urgent need to stress this farm crisis. I intend to be in Worthington, 
MN, this Saturday with Senator Wellstone and others. I think it is a 
9:30 a.m. farm rally. But I would expect a good many farm families will 
come from our four-State region to talk about their hopes and dreams 
and talk about especially what they hope this Congress will do to 
address this deep and abiding farm crisis.
  Mr. WELLSTONE. Mr. President, my colleague from North Dakota is 
right. This gathering is not a gathering just for farmers, but it is 
also for small businesses, for educators, for the religious community. 
It is really for rural America, farmers and other citizens from the 
Dakotas, from Iowa, from Minnesota. It is going to be 9:30 to noon at 
the Nobles County Fairground grandstand. And I also say to my colleague 
from North Dakota, it is very important to point out to the presiding 
Chair and others that Republicans are invited to be a part of this 
gathering. This is going to be a bipartisan effort to focus the 
attention of the Nation on what is happening in agriculture. So it is a 
very, very important gathering. I think there will be a huge turnout of 
people, and I hope that those of us who represent the Midwest, 
Democrats and Republicans alike, will be there.
  Mr. President, I want to read the beginning of the letter that Wally 
Sparby sent to me. Again, he is the director of the Minnesota State 
office of the USDA Farm Service Agency.

       Senator Wellstone:
       During our 1998 loan season, we approved loans based on $4 
     per bushel for wheat and $2.55 to $2.75 for corn. Now that 
     farmers are receiving from $2.50 to $2.70 for their wheat in 
     the marketplace and $1.42 to $1.52 per bushel for their corn, 
     it just does not sustain cash flow.

  And among the recommendations, the first recommendation is:

       The one thing Congress can do that will help farmers with 
     cash flow today more than anything else is to take the caps 
     off loan rates.

  That is followed by two exclamation points. I would, again, like to 
have this letter printed in the Record. I think the Chair already 
indicated its approval.
  Mr. President, for the State of Minnesota, according to the Federal 
figures, net farm income fell 38 percent from 1996 to 1997. With these 
prices, the current farm income might fall far more than that if we do 
not act.
  I am going to get to the figures and the statistics in a moment, but 
I would again like to go back to what I said to my colleague, Senator 
Harkin from Iowa, at the beginning. We just now had a unanimous consent 
agreement that there will be no second-degree amendment, but from my 
point of view, as a Senator from Minnesota, I would just want to say to 
the majority leader, Senator Lott, I do not think this procedure is 
satisfactory. I think we should be accountable. I do not think this 
should be a tabling motion. I think this should be an up-or-down vote.
  We have a package of proposals here, which I will go over in a 
moment, which represent our best effort to, in a very positive way, 
respond to an economic convulsion that is taking place in agriculture, 
to respond to the economic pain of people we represent, to respond to 
the fact that we now have broken dreams and broken lives and broken 
families, and the status quo is unacceptable. There is not a one of us, 
Democrat or Republican, from the Midwest or from the agricultural 
States, who cannot and should not be out on the floor of the Senate 
fighting as hard as we can for our people. This is the issue, and I 
don't think the majority leader's proposal that we have an up or down 
tabling motion is satisfactory.

[[Page S10290]]

 For my own part, I do not intend for this to be the end of the debate 
this week. We are going to come back to this question over and over 
again. We must.
  I think the intent that there only be 3 hours to debate this 
amendment marginalizes or trivializes what is a central issue in the 
United States of America today. I think a tabling motion as opposed to 
an up-or-down vote does the same thing, and we are going to have to be 
held accountable. One way or another, if we should not prevail today, 
my working assumption--I am only speaking for myself as a Senator from 
Minnesota--is that we will come back to this over and over again in 
however many weeks we have remaining. I consider it to be my mandate as 
a Senator from Minnesota to make this my central priority.

  I do not know any other way to do it. We have so many discussions on 
the floor of the Senate. People are just coming --they are not even 
back yet. A lot of Senators will not even have an opportunity to debate 
this before we have a tabling motion.
  Let me just say that in personal terms what this means, this 
depression in agriculture, these record low prices, is that family 
farmers, that is to say, people who work on the land, live on the 
land--they are not absentee investors--are not going to make it. It is 
just that simple. They cannot make it. So in personal terms this is 
devastating not just for family farmers but for our small towns, our 
rural communities, whether it be in Minnesota, Iowa, North Dakota or 
South Dakota. You name it. It is devastating, absolutely devastating.
  We are always going to have somebody farming. There will be acres of 
land. Someone will own the land. Someone will own the animals for the 
livestock producers, but the health and vitality of our communities in 
rural America is not based upon the number of acres that are farmed or 
the number of farm animals. It is based upon the number of family 
farmers who live in those communities and contribute to our schools and 
buy from our local businesses and contribute to our churches or 
synagogues.
  That is what this is all about. We are confronted with the fierce 
urgency of now. If we are not careful, time is going to march on, and 
it is going to leave all of us standing alone, standing naked. What 
that will really mean is that family farmers are just going to be 
driven off the land where they not only work but where they live.
  Again, before I get to the statistics, because I want my colleagues, 
as I make this plea to Republicans as well, and Democrats and everybody 
here to understand my own position, which is going to be today if we 
win, great; if we do not, come back over and over and over again--from 
my own part I remember moving out to Minnesota to Northfield, where I 
was a teacher, college teacher, and I don't have an agricultural 
background, but my father was a Jewish immigrant who fled persecution 
in Russia where he was a writer. My mother was a cafeteria worker. But, 
Theresa and Phil--Phil Van Zuillan is no longer alive, he passed away--
from Nerstrand in rural Rice County, they were the people who were my 
teachers when I began to do a lot of community organizing. And that is 
when I first began to learn about community agriculture. And my friend, 
Don Langer, who is no longer alive. I learned an awful lot from farmers 
in Rice County, crop farmers, dairy farmers, about a county 490-some 
square miles, population 41,000. And then I began to organize with 
farmers.

  And then there was the mid-1980s, and all my organizing then was with 
farmers. And we saw just essentially a meltdown in agriculture. We saw 
people driven off the land and record foreclosures--record low prices 
and record farm foreclosures, in that formula that goes together. I 
remember going to some of those foreclosures--it was awful--some of 
those auctions. It was awful. I remember seeing people just breaking 
down and crying. There were some farm families--let me not be 
melodramatic, but let me just say it because it is true: I remember 
some of the men I met, some of the farmers I met, who took their lives. 
They took their lives.
  Mary Ryan works in our office in Willmar in West Central Minnesota, 
Mary and Bob Ryan--one of their friends, I say to my colleague, Senator 
Conrad from North Dakota, took his life. He had been foreclosed on. 
That is what is going on now. We have to somehow sort of bring this to 
the attention of the Nation today, but today is not the end of it. If 
this set of proposals are tabled, this is just the beginning. This will 
not be the end. For me, I will tell you that as a Senator from 
Minnesota, it will just be the beginning. We saw this dislocation, we 
saw people foreclosed on. We had huge, massive rallies. We had anywhere 
between 10,000 and 15,000 people who marched on the State capital in 
Minnesota.
  I do not want to go through it again, but that is exactly what is 
happening. My appeal to farmers in our States, and not just the 
farmers, but to rural America and around the country, is we are going 
to need you. I hope we succeed today, but if we do not succeed today I 
hope you will hold people accountable. We are going to need you because 
we are going to be back over and over again. The principal problem is 
low commodity prices. If I had a blackboard here and I was teaching, I 
would just write: Price, price, price. The price of corn in Minnesota 
is $1.50 a bushel, or even less at many elevators. You could be the 
best farmer in the world, the best manager in the world, and there is 
no way you can cash-flow at $1.50 a bushel. We ought to have a price of 
$2.70 or even $3 a bushel. Anything below $2 a bushel is a death knell 
for family farmers. Virtually no farmer can cash-flow at that level.
  Wheat these days in Minnesota is about $2.65 per bushel. It should be 
$3.75 or $4. Soybeans are approximately $5 or $5.10. We would like to 
see that price at $6. The current prices are almost unbelievably low.
  According to a letter sent by Secretary of Agriculture Dan Glickman 
to Minority Leader Daschle, corn prices nationwide are 30 percent below 
the average price of the last 5 years; wheat prices are 28 percent 
under the average price; and soybean prices are 17 percent below 5-year 
averages. Livestock prices are way down as well.
  This is exactly what happened in the mid-1980s, and we had this 
massive shakeout of family farmers at that time which changed the face 
of rural America--and not for the better. Many communities in Minnesota 
and all across the heartland were devastated by what happened. And that 
is going to happen again. It is happening now, and we are going to see 
many of our rural communities destroyed on the present course. We must 
change that course. This amendment that we have introduced is a 
positive proposal to change that course.
  Some in Minnesota are talking about losses to our State's economy 
this year of over $1 billion. Some are speaking about 20 percent plus 
of family farmers who are threatened. Again, this is not just for the 
family farmers. It is for small business people, it is for ag lenders, 
it is for our educational institutions, it is for our children, it is 
for our grandchildren, it is for our small towns, it is for our rural 
communities. Do you know what else? In Minnesota, it is also for the 
Twin Cities. We are all in the same boat. The fate of greater Minnesota 
and the health and vitality of greater Minnesota, or lack thereof, and 
health and vitality of our metropolitan area are intertwined. We are 
looking at an economic convulsion in rural America. Certainly that is 
the case in the Midwest. We are looking at broken dreams and broken 
lives and broken families. We have to do something.
  I was at a farm crisis meeting, first in Crookston, MN, back in 
March, in northwestern Minnesota. My colleague, Senator Conrad, will 
speak about this as well. It certainly applies to North Dakota in full 
force. The issue was not just low prices, but several years of bad 
weather and crop disease. Then I was on a farm in Granite Falls, MN, 
East Grand Forks and Fulda.
  Next weekend, we have this rally scheduled, September 19, Saturday 
morning. Again, 9:30 to noon, rain or shine, Nobles County Fairgrounds 
grandstand, Worthington, MN, junction I-90 and highway 59. Senator 
Harkin will be there. Senator Dorgan will be there. As many Republicans 
as possible, and Democrats, I hope will be there as well.

  It is not a partisan crisis. I can tell you right now, many of these 
farmers

[[Page S10291]]

who are going under are not Democrats. Many are Republicans and many 
are Democrats. And I don't think it makes a darned bit of difference to 
any of them, in terms of political party.
  Mr. President, we have taken some steps this year to address the 
problem. But we are falling way short. We included, if Senator Conrad 
remembers this, we included some additional plant loan money into the 
supplemental appropriations bill earlier this year. That was for spring 
planting loans. We were pleased to do that. It helped some. Senator 
Conrad and Dorgan and Daschle and others--and I was pleased to be a 
part of that effort--put together an indemnity bill that was $500 
million in disaster assistance. It is going to go way up. We are now 
talking about $1.5 billion of indemnity payments when we are looking at 
what is happening in the South as well. That is part of this amendment. 
That is critically important. We need to get some assistance to people, 
ASAP. This is a crisis, all in capital letters.
  What our current amendment does is simple. I am just going to focus 
on two or three provisions. First thing our amendment does is it lifts 
the cap on the farm marketing loan rates, and it raises that loan rate. 
Again, the primary problem is price. What farmers say to me is: Paul, 
even if you get the payments out, indemnity payment, disaster 
assistance payments for us, what is the future for us? Comodity prices 
have fallen through the floor. Whatever our explanation is for the low 
commodity prices, there has to be some kind of safety net to help 
people stay in business. The single most important thing we can do is 
to improve prices, and the tool we have available to us is the loan 
rate.
  The loan rate does not set the prices, it does not even set a floor 
under the prices. If it did, the prices would not be as low as they are 
currently. But the loan rate does tend to give farmers--there is not 
one Senator who can argue to the contrary--a bit of leverage in the 
marketplace. It let's them take a loan on that crop, on their crop, and 
hang on to the crop and wait for prices to improve--if that is their 
choice.
  Or, and this is a critical point--I am sorry that we are at this 
critical point, but we are--or, when the prices fall below the loan 
rate, farmers can also use that loan rate as a safety net and take a 
check worth the difference between the loan rate and the market price 
on the amount of their production.
  It is simple. It is simple. Unfortunately, the 1996 farm bill, which 
I always call the ``freedom to fail'' bill--when it passed, I called it 
that--capped those loan rates at unrealistically low levels. There were 
some good things in the Freedom to Farm or ``freedom to fail'' bill, I 
say to my colleagues who are now coming to the floor, but at least we 
have to have this modification.
  For corn, the Freedom to Farm bill capped loan rates at $1.89 a 
bushel. Again, virtually no farmer can make it on $1.89 a bushel. It 
doesn't even work as a partial safety net.
  What our amendment will do is lift the current cap on loan rates and 
raise the marketing loan rate on corn from its current $1.89 per bushel 
to $2.20 or $2.25. It will raise the loan rate for wheat from the 
current $2.58 to about $3.22. Raising the loan rate usually tends to 
set a floor under prices by giving farmers some leverage in the 
marketplace. At a minimum, it certainly will greatly improve the safety 
net for our farmers.
  Our proposal will also extend the repayment period on these same 
marketing loans to give farmers an extra 6 months to hold on to the 
grain and wait for a better price.
  The purpose of both of these provisions is to give farmers some 
leverage. The Freedom to Farm bill--what I call the ``freedom to fail'' 
bill--gave farmers planting flexibility. That is great. Let me repeat 
it, that is great.
  We were for that. But we now need to give farmers some marketing 
freedom to go along with the planting freedom. We need to raise the 
loan rate and extend the repayment on these loans along with 
dramatically increasing the indemnity money.
  I am going to say it one more time. I have other colleagues on the 
floor who want to speak. Mr. President, we have come to the floor of 
the Senate with a set of proposals that are substantive, that are 
credible. The vast majority of family farmers around the country, I am 
positive, support the proposal to take the cap off the loan rate and 
get the price up to give them some leverage in the marketplace and the 
indemnity payments. I hope that there will be strong bipartisan support 
for this amendment. I hope so. If not, if this amendment should be 
tabled, then as far as I am concerned, the debate just begins.
  I say to Senator Conrad, who is about to speak--I am about to yield 
the floor--but I think he will agree with the last point I make which 
is, for us, am I right, I say to Senator Conrad, this is the issue, 
this has to be our work, we want it to be our work? We don't want the 
pain to be there, but we can't go home without fighting in every 
possible way, using every rule available, using all of our leverage to 
make sure that this Senate and this Congress comes forward with 
positive legislation that can make a difference so that so many good, 
wonderful people in our States don't go under, are not ruined, are not 
devastated. That is what this debate is all about. I yield the floor.
  Mr. CONRAD addressed the Chair.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. CONRAD. Mr. President, I rise to support the package of 
amendments that is before us, because agriculture in my State is in a 
crisis. I have previously referred to it as a stealth disaster, because 
it is flying below the radar screen of much of the national media. 
Unlike the disasters of last year that were very visual, this is hard 
to take a picture of, because this is a circumstance where we have 
collapsing prices and falling production, and the combination of the 
two is pressing farmers and forcing them into selling out.
  I draw my colleagues' attention to a May, 1998, front-page Wall 
Street Journal story that examined the agricultural crisis in the 
heartland of America. It pointed out very clearly that on the northern 
plains, the new farm bill is yielding pain and upheaval, and, indeed, 
it is. They point out that the dramatic drop in wheat prices was 
already, back in May, creating desperate problems for farmers in my 
State, but also in the State of the Senator from Minnesota, Senator 
Wellstone, who just spoke.
  This is a problem that is now recognized not just in our home areas, 
but across the country. Indeed, not only has the Wall Street Journal 
written articles on what is happening, but the New York Times. This is 
a story that ran in July, 1998. They point out we have a desperate 
crisis in agriculture. We have seen, in fact, two front-page stories in 
the New York Times, a front-page story in the Washington Post, all 
talking about the extreme conditions farmers in North Dakota are 
facing.
  Just moments ago, the respected Farm Journal released a survey of 
1,000 wheat and corn farmers. The support for changes in farm policy in 
that Farm Journal survey is overwhelming: 73 percent of those surveyed 
believe that our current farm bill does not provide adequate income; 77 
percent believe Congress should modify the farm bill; 73 percent 
believe we should lift the caps on marketing loans; 85 percent believe 
we must stop the import of surplus grain from abroad; 86 percent 
believe the United States should reestablish the farmer-owned and 
controlled grain reserve. Only 40 percent of farmers surveyed believe 
that they will be farming in 5 years. Mr. President, only 32 percent 
said they would encourage their kids to farm.
  This is a survey done by the Farm Journal, perhaps one of the most 
respected farm journals in this country. The level of support for a 
change in farm policy is overwhelming, and of course it should be, 
because what is happening is an unmitigated disaster.
  This chart shows what is happening in my home State of North Dakota. 
North Dakota farm incomes were washed away in 1997. From 1996 to 1997, 
according to the Government's own records, there was a 98-percent 
reduction in farm income--a 98-percent reduction. By any measure, this 
is a calamity, and the result is that literally thousands of farmers 
are quitting. In fact, the Secretary of Agriculture visited North 
Dakota in June, 1998. When he came to visit with area producers, he was 
told by his own crisis response team that we might anticipate losing

[[Page S10292]]

up to 25 or even 30 percent of the farmers in my State in the next 2 
years. Mr. President, this may be a stealth disaster, but it is a 
disaster nonetheless, and it requires a response.
  The drop in farm income is not just limited to North Dakota. In fact, 
we are seeing farm income drop in a majority of States. This shows the 
decrease in farm income from 1996 to 1997 in State after State.
  You can see North Dakota, unfortunately, led the way. But not very 
far behind were Missouri, Maryland, New York, West Virginia, Virginia, 
Minnesota, Wisconsin. You can see that the heartland States in many 
cases were those most affected.
  In 1998, this picture is even getting more serious, because we are 
seeing other States deeply affected, some of them by natural disaster, 
all of them--all of them--by collapsing prices.
  Mr. President, we have to understand that this disaster is a result 
of really two factors: One, natural disasters in my State--overly wet 
conditions that have led to a dramatic loss in production because of 
fungus that has gotten loose in the fields. That fungus has caused 
dramatic crop losses. But on top of that, we have very low farm prices. 
In fact, we have now reached the lowest level in real terms for farm 
prices in our history.
  This shows spring wheat prices from 1946 to 1997. You can see in 1997 
already we were nearing the all-time lows for wheat prices.
  Look what has happened in 1998. The bottom has fallen out. We have 
the lowest prices in real terms in history. In nominal terms we have 
the lowest prices in 21 years. The result is a collapse of income for 
farmers and the result is thousands of farmers being forced off the 
land.
  I had a blowup made of some of the ads that are in the farm journals 
back home. Auction, auction, auction--we are absolutely being flooded 
with auctions all across North Dakota and Minnesota, parts of Montana 
and South Dakota and Wisconsin. And one of the interesting things to 
note is, it isn't old equipment being auctioned off. It is new 
equipment--1996 cultivator, 1996 swapper, 1996 disc, 1996 tractor. 
These are farmers who thought they were going to be around. They 
thought they were going to be in farming, but they are being forced off 
the land.
  Mr. President, in North Dakota, wheat prices last week hit $2.50 a 
bushel--$2.50 a bushel for a commodity that takes about $5 a bushel to 
produce. Some have said, ``Well, they just plant more and make it up in 
volume.'' It reminds me of the story of the fellow that was selling 
shovels. He was buying them for $20 and selling them for $16. And he 
was so excited because he was selling lots of them. One of his friends 
with a little cooler head said, ``You know, it's not working out so 
well if you buy them for $20 and are selling them for $16. You're 
losing $4 on every shovel.'' This fellow, who was the ultimate optimist 
said, ``I'm going to make up for it in volume.'' You are not going to 
make up for it in volume. You are not going to make up for it in any 
way when you are losing $4 on every shovel you sell.
  The same thing is happening on every bushel of wheat. When it costs 
you $5 to produce, and you are getting $2.50 at the market, you are not 
going to stay in business very long. That is the hard reality. That is 
the simple truth.
  Mr. President, that is what is happening in my State and many others. 
Something must be done. And it must be done quickly or we are going to 
see an exodus from agriculture unlike any we have seen in our history.
  Mr. President, it is not enough to define the problem. It is also 
important to look at what is causing the problem. Let me just put up a 
chart that shows what we did in the last farm bill.
  In the last farm bill we dramatically cut support for agriculture. In 
the previous 5-year farm bill we averaged $10 billion a year in support 
for American producers. In the new farm bill, that has been cut in 
half--$5 billion a year for support for our agriculture producers--a 
dramatic reduction. In fact, this is the biggest cut in Federal 
spending of any part of the Federal budget.
  I am someone that has been a deficit hawk the entire time I have been 
in the U.S. Senate. I deeply believe in balanced budgets, not because 
that is the thing to do, but because it makes economic sense. It takes 
pressure off interest rates and allows America to be more competitive 
and allows us to get back on track. That is exactly what has happened 
since we started dramatic reductions in the deficit since 1993.
  Mr. President, it is important to understand that no sector of the 
budget has taken bigger reductions than agriculture. If we look at what 
our competitors are doing, we see why it puts us in a very difficult 
position. Because our competitors in Europe are spending much more than 
we are at supporting their producers.
  Mr. President, I indicated that in our country we are spending $5 
billion a year to support our farmers. But in Europe, they are spending 
nearly $50 billion a year to support their producers. This is an unfair 
fight. It is one thing to say to our farmers, ``You go out there and 
compete against the French farmer and the German farmer.'' That is 
fair. It is not fair to say to our farmers, ``And while you're at it, 
you go compete against the French Government and the German Government 
as well.'' That is not a fair fight. But that is exactly what we are 
telling our farmers to do. This represents unilateral disarmament in a 
trade war. We would never do this in a military confrontation. Why are 
we doing it in a trade confrontation?
  Mr. President, $50 billion a year by Europe to support their 
producers; $5 billion a year by us to support our producers. Is it any 
wonder that we are losing the fight? Is it any wonder that Europe is on 
the march and on the move? Is it any wonder that Europe, who believes 
they have a strategy and a plan, believes that that strategy and plan 
are working?
  Mr. President, we have to wake up in America. We have to understand 
that our competitors think we are asleep. They believe that we have 
been prosperous so long that we are not going to be willing to stay the 
fight. They believe that America is going to roll over and that they 
are going to be able to resume agricultural dominance.
  Mr. President, if you examine the trend lines so far, they are right, 
because if you look at what the Europeans are doing, they have gone 
from being major wheat importers to being major exporters. Their share 
of the world grain trade has increased year after year after year. And 
it is time for America to decide, do we fight back or do we surrender?
  I do not believe America wants to surrender. I believe America wants 
to fight back. Other countries want farmers out across the land, not 
huddled in the cities. That is the choice before us, Mr. President. 
Because unless we respond, unless we react, unless we help our 
producers in this fight, they will lose. And that will be a sad day for 
America. That will be a day we live to regret, because agriculture is 
at the heart of America's economic dominance. Make no mistake, 
agriculture is right at the heart of the strength of America. And if we 
are to surrender that position of dominance, we will rue the day we 
allow it to happen.
  Mr. President, the last farm bill we passed dramatically reduced 
support. I put a chart up that showed spending per year for our farmers 
was cut in half. This chart shows the payments that are going out to 
farmers. In 1998--that is the year we are in--you can see this is the 
best year; this is the best year under the new farm plan, the best 
year. Look where it goes from here--down, down, down.
  Mr. President, this cannot be allowed to stand. If you look at it 
from the individual producer's standpoint, here is what happens to the 
per bushel support that they get under the new farm plan: 1996, 1997--
you can see 1998 is the second best year in terms of per bushel 
payments to our farmers. And then it goes down, down, down.
  Again, Mr. President, we have our farmers going on a one-way 
escalator, and it is an escalator going down. It is an escalator 
leading to defeat. It is an escalator that says to our farmers, forget 
it, because this country is not going to stand behind you in this 
worldwide trade confrontation. We are going to give up. We are going to 
surrender. We are going to wave the white flag. We would never do that 
in any kind of military confrontation, and we should not be doing it in 
this trade confrontation.
  As we look at what is before the Senate in terms of this package, we 
have

[[Page S10293]]

an increase in indemnity payments. A number of weeks ago, I introduced 
on the floor an indemnity plan to help farmers because they are 
suffering from natural disasters. So many farmers in our State have had 
5 years of extraordinary conditions, very bad conditions for the 
growing of grain, conditions that have led to this outbreak of disease, 
conditions that have led to a steep drop in production. We put in place 
crop insurance. It is supposed to be the risk manager for our farmers 
and help them in disastrous circumstances.
  One of the things we have learned about this new program of crop 
insurance is that it does not work where you have multiple years of 
disaster. It does not work. The reason it doesn't work is because your 
production history and base are determined on what your last 5 years of 
production have been. If you have suffered disaster after disaster, 
your base is reduced; that determines what you get paid under crop 
insurance. If you have had 5 years of disaster, your base is so reduced 
that there is not a safety net, even though the farmers are paying for 
it through crop insurance premiums.
  The first thing we need to do, and the Senate has already agreed, is 
to provide a system of indemnity payments to those who have had 
experienced repeated losses and suffered sharp income declines.
  Those indemnity payments that we passed in the U.S. Senate were for 
$500 million. However, since we passed them, the losses have mounted. 
They have increased because of drought and disasters in Oklahoma and 
Louisiana. Because of other natural disasters around the country, we 
are seeing the income losses mount.
  In this amendment we are proposing $1.5 billion. Already, the USDA 
tells us that to provide the same level of support we had when we 
passed the $500 million amendment in July, it would now take $1.1 
billion today to provide the same level of assistance. We are proposing 
to go to $1.5 billion to cover these mounting losses with respect to an 
indemnity payment.
  In addition, we are recommending that we lift the marketing loan rate 
caps, these artificial caps that were put in place in the last farm 
bill. On wheat, those caps are put in place at $2.58 a bushel; $2.58, 
when it costs about $5 a bushel to produce the product. Obviously, 
those marketing loan rate caps in no way cover the costs of production. 
The result is devastating losses to farmers' income. The result is 
devastating losses of farm families.
  That is why we are recommending lifting those loan rate caps. No, not 
to $5; no, not to $4; no, not even to $3.50; but to about $3.20. We 
think that is a reasonable proposal on top of the indemnity plan to get 
some money out across the land so farmers are not forced off their 
farms. Those are the two key elements of this plan: an indemnity 
payment plan and lifting of the marketing loan rate caps.
  I have already indicated, according to the Farm Journal and their 
survey just released moments ago, that the overwhelming majority of 
farmers support lifting the marketing loan rate caps. Now, we will hear 
some argue that if you lift the loan rate caps, prices will increase 
and, therefore, production will increase, and therefore a further glut 
on the market will be created.
  I had my staff call the Chief Economist's office at the Department of 
Agriculture and ask them if that scenario is plausible. They told us, 
no, it is not plausible due to the structure of the marketing loan 
program. If we lift the loan rate to $3.20 a bushel, a farmer can take 
out a loan for that amount. If he ultimately markets the grain for less 
than that, he can keep the difference. Only if he sells the grain for 
more than that $3.20 does he repay the entire loan amount. That is the 
way the marketing loan works. By the way, this is not unprecedented. We 
have a marketing loan in place for cotton and rice. It has worked 
extremely well for those commodities.
  What is wrong here is that the loan rate that we have set is simply 
too low. It is not allowing farmers to recover sufficient income to be 
able to stay in business. Again, some have argued if you do this you 
will get more production; you will raise prices. The people at USDA, 
the Chief Economist's office, say that is not true. Because of the way 
the marketing loan rate is structured, a farmer sells for whatever the 
market brings. If the market is $2, he gets $2. If the market is $2.50, 
he gets $2.50. But he gets to keep the difference between the marketing 
loan rate amount and what he gets for his product in the marketplace. 
He only repays entirely if, in fact, he gets more in the market than 
the marketing loan amount. It is, in effect, a safety net. A producer 
sells his product at whatever he can get for it, but then he is able to 
keep the difference between the marketing loan rate amount and the 
market price.
  I don't think those who argue that this is going to build stocks have 
studied this proposal carefully because this applies for just this 
year. Those who say it will lead to more production are going to have 
to answer the question, How is that? America has already planted and 
harvested its crops for this year. How is it that we will have more 
production when we have already produced this year's crop?
  This marketing loan rate increase only applies to this crop year. How 
is it, we have to ask those on the other side, that this is going to 
lead to more production when, in fact, the production for this year is 
already determined? We have already planted. We have already harvested. 
This marketing loan rate increase is not going to increase production 
because there is no way to increase the production that is already in 
the bin. This year is a closed album.
  Some say it is going to induce others to produce more. Europe has 
finished their crop for this year. Canada has finished their crop for 
this year. We have finished our crop for this year. Who is it that is 
going to produce more because of a marketing loan rate increase in the 
United States? The Chief Economist for the United States Agriculture 
Department says it is not going to induce a price increase anywhere.
  The fact is, this is a way of getting financial assistance to farmers 
who are in a disastrous condition now. What are the alternatives? If 
somebody else has a better idea, another alternative, I am glad to 
listen to it. But right here, right now, we have what the farmers are 
calling for. What the farmers are calling for is to take away these 
artificial loan rate limits and give farmers a fighting chance against 
this incredible international competition, where our chief competitors 
are spending ten times as much as we are in order to support their 
farmers. I have indicated that Europe is spending nearly $50 billion a 
year to support their producers and we are spending $5 billion.
  In support of exports, the margin is even more dramatic. In 1997, we 
spent $56 million supporting agricultural exports; Europe spent nearly 
$8 billion. This was a ratio of about 138-to-1. Now, I defy my 
colleagues to explain how it is we win a fight when our side is being 
outspent 138-to-1. How is it that you have any chance of winning when 
the other side is outspending you 138-to-1?
  Mr. President, I hope very much that my colleagues will move to 
support this amendment, that the attempt to table this amendment will 
fail, and that together Republicans and Democrats will decide to back 
our producers, support our farmers, to say to our chief competitors, 
the Europeans: ``You are not going to buy these markets. America is not 
going to wave the white flag of surrender, because this country 
deserves better.'' It would be a profound mistake to let 20 or 30 
percent of our farmers be washed away because other countries have put 
a higher value on their producers.
  Mr. President, I hope very much in the coming hours that people will 
reflect very carefully on the vote that we are to cast, that they will 
understand that we are in a trade confrontation, that our chief 
competitors are outspending us 10-to-1 in terms of overall support for 
producers. In exports, they are outspending us 100-to-1. Now is the 
time to respond, fight back, and the time for America to say that we 
are not going to allow our competitors to put our farmers under because 
our country is not willing to stand behind its producers.
  Mr. President, this will be a defining moment for this year. This 
will be a defining moment on the floor of the U.S. Senate when we vote 
on this amendment. I hope very much, on a bipartisan basis, that our 
colleagues will stand behind our farmers and our farm

[[Page S10294]]

families and not allow them to be pushed off the land, to be forced 
into the cities, and to be left with a very hollow legacy.
  I just want to close by saying I just had a farmer call me, whose 
family has been on the land for over 100 years. They are farmers in the 
Red River Valley of North Dakota, which is some of the richest farmland 
in the world. He told me, with tears, that this was the last year for 
him and his family, that they could not go forward any longer, that it 
was not possible for them to survive this collection of natural 
disasters and disastrously low farm prices.
  Mr. President, the person that made that call to me is somebody who 
is recognized in our State as one of our very best farmers. He has won 
award after award. This is not a case of bad management. This is not a 
case of people who are spending money foolishly. This is a case of 
people who have worked hard and committed themselves fully. In fact, in 
this family, both the man and wife have off-farm jobs as well as full-
time farm work. And every member of that family has made a commitment 
to farm this year. But because of these disastrous conditions, they 
have said this is their last year.
  Mr. President, America will be stronger if that family stays on the 
farm. America will be better if that family stays on the farm. But it 
will not happen unless we are willing to help them fight. It will not 
happen unless we are willing to stand shoulder-to-shoulder with that 
farm family to give them a fighting chance. It will not happen unless 
we recognize that we are in a trade confrontation and that we have sent 
our farmers very lightly armed into a battle in which the competition 
is heavily armed.
  I have spent many hours meeting with European agricultural leaders. 
It is clear to me that they have a plan and they have a strategy. Their 
plan and strategy is to regain agricultural dominance worldwide. I hope 
we don't show the white flag of surrender and give in to our 
competitors and walk away from this fight. We ought to say today that 
America is standing by its producers and we intend to fight and we 
intend to win.
  I yield the floor.
  Mr. JOHNSON addressed the Chair.
  The PRESIDING OFFICER (Ms. Collins). The Senator from South Dakota is 
recognized.
  Mr. JOHNSON. Madam President, I commend my colleagues, Senator 
Daschle, Senator Harkin, Senator Dorgan, Senator Conrad, Senator 
Wellstone, and others who have devoted a great amount of time, energy, 
and talent to crafting this amendment. I rise in strong support of this 
comprehensive farm relief package being debated on the Senate floor 
today.
  Madam President, I have been in communication with my home State just 
this morning. Local cash prices for corn now, as we are approaching 
harvest, have collapsed to a new record low. Cash corn in Winner, SD, 
is bringing $1.10 per bushel today as we speak. Wheat prices have 
collapsed to $1.70 per bushel. Land values across my State are 
beginning to falter. In a communication with a farmer near the 
Aberdeen, SD, area today, I am apprised of land values that have been 
valued at $800 an acre bringing only $400 an acre in actual sale this 
week.
  This has a rippling effect. As I talk to farm implement dealers, 
those providing feed, chemical dealers, veterinarians, mechanics, and 
all the people who prosper when farmers and ranchers in our Nation 
prosper, they say we need now, more than ever, not only comprehensive 
legislation, but urgent legislation, to deal in a constructive fashion 
with the crisis we face in farm country.
  Now, Senator Conrad, I think, made an excellent point in pointing out 
how the European Community is spending roughly $50 billion per year 
sustaining family agriculture in the E.C. In the United States, where 
only 10 or 12 years ago we were spending $26 billion ourselves, we are 
now down to $5 billion, and we are headed to zero, to the point where 
we sustain family agriculture, in the greatest food-producing mechanism 
the world has ever known, with far less than one-half percent of the 
Federal budget.
  Is there a reason our European friends sustain their family 
agriculture at such a high level? Well, yes, there is. The reason is 
obvious. In Europe, they have been hungry a couple of times in this 
century. They know the dilemma that every society faces when 
agriculture is on its knees, when people are leaving the farm, when 
food production is inadequate. They value highly the reliability and 
sustainability and high quality of agriculture in their part of the 
world.
  We in the United States, I am afraid, have grown complacent with the 
thought that somehow, no matter what we do, fields will be planted and 
the livestock will be raised, the food will remain inexpensive at the 
grocery mart, even while we destroy the roots of our agricultural 
production in this country. I fear that we are going to reach the point 
some day when we are going to have an experience something similar to 
what the former Soviet Union found when they destroyed family 
agriculture, thinking that they could find a new, more efficient way of 
growing food, only to find the results catastrophic for their society.
  Now Russia is trying to reestablish family agriculture. But guess 
what? Once family agriculture has been pulled up by the roots, it is 
not so easily reestablished. It is very difficult to do. I fear that 
indirectly we are going down some of that same road of the destruction 
of family-based agriculture in this country.
  I appreciate that there are some who have such a commitment to the 
current farm bill that it borders on a theological commitment that 
nothing could be changed in that farm bill. There is much in the 
Freedom to Farm legislation that is constructive. And it is positive. I 
think most of us applaud the flexibility and the lessened degree of 
micromanagement that came with that farm bill. Yet, at the same time, I 
think there is a growing recognition that all is not well. In fact, 
portions of the farm bill need a desperate and urgent revisit.
  We understand that with the collapse of prices that we have now that 
we need to give farmers a better opportunity to weather these down 
cycles, both in the grain side, in the farm bill's case, and in terms 
of livestock production.
  For the past few months, I have joined my farm State Democratic 
colleagues in working on ways to improve economic conditions for 
farmers and ranchers. As you may remember, during this year's 
Agriculture appropriations bill, we introduced legislation to assist 
farmers. We offered amendments which would lift the caps on marketing 
loans for grain farmers, provide disaster assistance for farmers who 
suffered losses, provide for mandatory price reporting for livestock 
sales, and the labeling of imported beef and lamb products.
  We were successful to some degree with those amendments. We passed 
three of those proposals through this Senate: a $500 million disaster 
relief assistance package for farmers, a pilot project for mandatory 
price reporting on captive supplies of live cattle and boxed beef, and 
an amendment which I offered that will label beef and lamb products for 
country of origin. However, now that we have gone through the August 
recess, we are into September, and we still have to convince the House 
conferees of the importance of these proposals.
  So we are back today because the economy in farm country and ranch 
country is getting, frankly, desperate. Since July, prices for cattle 
and crops have fallen further, and it seems at this point that there is 
almost no end in sight.
  My recent conversations with farmers and ranchers across my State 
have been alarming. Ranchers have been selling off their cattle herds. 
Farmers are applying for off-farm jobs in preparation of losing their 
farms. And farm-related businesses are laying off employees. Implement 
dealers are laying off mechanics. Sale barns and veterinarians are 
laying off their hired help as well.
  The ripple effect of this economic crisis has already hurt farmers 
and ranchers. But it is moving now quickly into our rural communities--
and not just the small communities but the larger cities and towns as 
well.
  With that, my farm State colleagues and I are offering this farm 
relief legislation--this amendment. This legislation is crucially 
needed if we are going to improve, if we are going to step in the right 
direction with our farm economy.

[[Page S10295]]

  The first measure included in this package lifts the caps on 
marketing loans and extends the terms from 9 to 15 months. Again, we 
voted on this very same amendment earlier on on this Senate floor. We 
were defeated on a party-line vote at that time. But this amendment is 
the best way to provide farmers with an immediate economic impact for 
the grain products they produce.
  It would amend the Agriculture Marketing Transition Act--Freedom to 
Farm. As many of us know, it gives the President of the United States 
the authority to declare a state of emergency for producers affected 
for 1 year, removing the current loan rate caps, and extending the loan 
period from 9 to 15 months.
  Wheat would have the cap increased from the current $2.58 to $3.22, 
up 64 cents per bushel; corn from $1.89, the current cap, to $2.25, up 
36 cents per bushel; and soybeans from $5.26 to $5.33, up 7 cents per 
bushel.
  This would build on the existing marketing loan that is in the 
current farm bill. This is not a revolutionary departure from the 
current farm bill. It simply extends and expands the caps to a point 
where they become meaningful.
  The Freedom to Farm, touted in the 1996 farm bill, did deliver the 
planting and management flexibility to farmers who are able to take 
advantage of that flexibility, but it failed to deliver freedom for 
farmers to market in a flexible manner and at a profitable manner. When 
the farm bill passed, wheat prices stood at nearly $6. Now, in some 
cases, it is down to $1.70. When the farm bill passed, corn was $5. Now 
it is $1.10 in some places.
  The financial progress and future viability of our farm and ranch 
operations depends on the profits that can be gained from our 
agricultural products. I think all of us support short-term disaster 
relief. And that is part of our package, too. But the long-term 
underlying challenge that we have is to create an environment in which 
the attendant market prices can be gained. Our farmers want, in the 
long run, to have a decent price for their products. They are not 
looking for government checks. They are not looking to go back to the 
old days of $26 billion a year in the farm program expenditures, 
although even that is only around half of what the European Community 
is spending today. But they want an environment where profitability is 
at least possible.
  When cash flow projections were developed last fall by farmers and 
creditors, better commodity prices were relied upon than what we see 
today. Keeping in mind the incredible, terrible prices that the farmers 
are now seeing, it is likely that we will see increased loan 
delinquencies and default rates in the coming months. So while 
producers are now essentially receiving prices comparable to what they 
received in the 1940s, their input and production costs reflect the 
modern-day realities of the 1990s.
  How many of us could make a decent living on 1940s wages and 1990s 
costs? We could not, and neither can the farmers nor the ranchers. So 
we are witnessing another devastating bout of farmers and ranchers 
going out of business.
  Second, this package will provide short-term disaster assistance. It 
will provide funding for income losses to farmers in the Dakotas, 
Texas, Oklahoma, and Louisiana--all of the hard-hit rural areas of our 
Nation.
  We successfully passed a $500 million proposal as part of the coming 
fiscal year's Agriculture appropriations debate. But it is still tied 
up in conference and it doesn't take into account the recent disasters 
we have had in Texas, Oklahoma and Louisiana, the devastating drought 
circumstances that currently exist there.
  Third, this package would provide for emergency storage payments. It 
provides for commodities placed under the marketing loans. It will 
allow farmers to store their grains during these low price cycles so 
they will be able to market them with an eye toward more profitability 
over a longer window every time.
  It would provide for mandatory price reporting creating a 3-year 
pilot program that requires meat packers to report prices on live 
cattle and boxed beef; allows the Secretary of Agriculture to define 
and prohibit anticompetitive practices. It strengthens the 1921 Packers 
and Stockyards Act; provides whistle-blower protection for smaller 
producers who speak out against captive supplies from business 
discrimination in the livestock industry; and, it would create a 
commission to study credit availability to determine if current lending 
practices on the part of the Federal Government contribute to the 
growing problem of concentration in agriculture. Lastly, and 
importantly to me, it would again reinvestigate the issue of labeling 
beef and lamb meat products.
  The Meat Labeling Act of 1998 was unanimously approved by the Senate 
during its deliberations of the 1999 Agriculture appropriations bill. 
The House, however, did not include it in its version of its 
Agriculture appropriations bill. Currently, we are tied up in 
conference.
  Again, this is commonsense legislation. We label virtually every 
product Americans purchase, whether it be T-shirts, auto parts, shoes, 
whatever. The one thing that is not labeled by country of origin is the 
food products we feed our families.
  This has the support of the National Cattlemen's Beef Association, 
the National Farmers Union, the American Farm Bureau Federation, and 
the American Sheep Industry Association. It has broad bipartisan 
support, and I am proud that the original Senate bill had the support 
of eight Republicans and nine Democratic Senators.
  Our livestock producers across this country have invested heavily in 
approved genetics, in marketing efforts, and in food safety in order to 
provide the best quality and safest food in the world to American 
consumers. But all too often they don't gain the benefit of those 
investments.
  With the Canadian producers sending over half their beef production 
into the United States today, I believe more than ever the time is ripe 
for American consumers to at least have the ability to judge for 
themselves whether or not they wish to buy a foreign product. They may 
choose to do so. That is their prerogative. There is nothing in the 
food labeling amendment that would prohibit imported meat products into 
the United States, but it would put us on par with what other countries 
in the world are doing. The European Community is going to be mandating 
country of origin food labeling by the year 2000 for all of their 
nations. Most other major consuming nations in the world also apply 
country of origin labeling to food as well as to other consumer 
products.
  This legislation, in short, is more than simply help for our 
livestock producers. It is endorsed by the National Consumers League, 
the Nation's oldest consumer organization. Once again, American 
consumers have a right to know the source of the food products they 
feed their families.
  Madam President, this particular effort is not anti free trade; it is 
common sense. I know there are some who say, on the one hand, that 
Americans may choose a foreign meat product. If they do so, that 
certainly is their prerogative. There are others who say no, Americans 
will choose American meat products. If they do so, again, it is their 
prerogative. There are those who are concerned that other nations will 
label country of origin on their food products. They already have. But 
even so, I have enough confidence, and obviously the American 
agricultural organizations, the key organizations that are in support 
of this amendment have equal confidence, that if any nation anywhere in 
the world wishes a stamp ``Made in USA'' on an American meat product, 
more power to them. We have confidence in our product. We think we can 
market with the country of origin label right now.
  Currently, Argentina, Australia, Bosnia, Brazil, Canada, Chile, 
Colombia, Costa Rica, the Czech Republic, the Dominican Republic, 
Egypt, El Salvador, Estonia, Guatemala, Honduras, Hungary, Indonesia, 
Israel, Korea, Latvia, Malaysia, Mexico, Philippines, Russia, 
Switzerland, Thailand, Turkey, United Arab Emirates, and Venezuela have 
some sort of meat labeling, with the E.C. soon to follow 
comprehensively by the year 2000.
  I have been meeting with Secretary Glickman as well as with Senator 
Larry Craig of Idaho, Senator Conrad Burns of Montana, Senator Max 
Baucus of Montana, and Senator Byron Dorgan of North Dakota to discuss 
the importance of this legislation to our

[[Page S10296]]

farmers and ranchers as well as our consumers. I am pleased that 
Secretary Glickman has exhibited his willingness to work with us on 
this legislation to make country of origin meat labeling a reality.
  With these steps in the right direction, I do not believe that we 
will have resolved all of the crises that we have in American 
agriculture, but it will go a long way toward addressing both the 
short- and the long-term problems we face. We need, obviously, to 
address trade issues, we need to address rural development issues, ag 
research--all of them go together--if we are going to have the kind of 
comprehensive strategy that is necessary to maintain a strong rural 
America and an underlying strong level of support for a qualitative and 
abundant food supply for this Nation.
  At this time, there is no other package that comes as close as this 
does to addressing the urgent crises that we have in American 
agriculture. So I enthusiastically rise in support of this amendment 
and again commend ranking member Harkin for his tremendous leadership, 
as well as Senator Daschle for his work in making this amendment a 
reality. This is an opportunity to address this crisis. We are running 
out of time. We have 5 to 6 weeks remaining of this Congress. There are 
farmers and ranchers leaving the land as we speak. There are small 
businesses going broke as we speak. There is no time to wait. We need 
to move now on this legislation and get this to the President's desk as 
quickly as possible.
  I yield the floor.
  Mr. HARKIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Iowa is recognized.
  Mr. HARKIN. Madam President, I thank the Senator from South Dakota 
for his contribution not only to this debate but his contribution to 
overall agriculture legislation which he has worked on for so many 
years, first as a Member of the House and now the Senate. I know of his 
deep commitment to family farmers and to doing whatever we can this 
fall to stop the crisis in agriculture. I know it is hitting the State 
of South Dakota every bit as hard as it is hitting Iowa and other 
States in the Midwest. So I listened carefully to what the Senator from 
South Dakota had to say, and he is right on the mark.
  Madam President, we cannot really afford to dally around any longer. 
We have to take action, and we have to take action now, or it is going 
to cost us a lot more later on.
  There are two things I would like to have printed in the Record. One 
is a letter dated September 10 from Secretary of Agriculture Glickman 
supporting the package of amendments we are considering in the Chamber 
right now. I ask unanimous consent this letter be printed in full in 
the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                        Department of Agriculture,


                                      Office of the Secretary,

                               Washington, DC, September 10, 1998.
     Hon. Tom Daschle,
     Minority Leader, U.S. Senate,
     The Capitol, Washington, DC.
       Dear Tom: I am writing in support of the Daschle-Harkin 
     Agriculture Relief amendments to address the crisis faced by 
     American farmers. This is an important set of actions that 
     will help respond to the deteriorating economic conditions 
     that have placed enormous burdens on our nation's 
     agricultural community.
       Our farmers are faced with problems unequaled in years: 
     Corn prices are 30% below the average of the past five years; 
     Wheat prices are 28% under the average level of the past five 
     years; Soybean prices are under the five year average by 16%; 
     Cattle prices are 17% under the 5 year average; Net cash farm 
     income projects will be 43% below the average of the past 
     five years; and as a result of these and other price 
     declines: many of our farm families are facing dire 
     circumstances; farm land values are declining, farmers are 
     increasingly facing cash flow problems, and they are being 
     told they might not get credit for their 1999 crops.
       When the President signed the 1996 Farm Bill, he said we 
     must do more to restore the safety net for American farmers. 
     In July, in response to this crisis, the President announced 
     measures to ease farmers' difficulties, including the 
     purchase of up to 80 million bushels of wheat worth 
     approximately $250 million for humanitarian shipment abroad, 
     and he supported the Conrad-Dorgan amendment for disaster 
     assistance that was added to the agricultural appropriations 
     bill.
       Since then, because crop prices have continued to plummet, 
     with no immediate sign that the trend will be reversed, we 
     must do even more. Therefore, the Administration supports the 
     Daschle-Harkin amendment to the Interior appropriations bill 
     that would remove the cap on marketing loan rates for one 
     year.
       We look forward to working with you to assist the nation's 
     farmers who have been so severely affected by these 
     circumstances.
       With best personal regards, I am
           Sincerely,
                                                     Dan Glickman,
                                                        Secretary.

  Mr. HARKIN. Secondly, Madam President, I learned this morning of a 
poll that had been taken, and the poll has just been released. I 
believe it was released at 2:30 this afternoon, so the paper is still 
hot, just off the press. It is quite a startling poll when you look at 
the results. I am going to talk about that. The poll was prepared by 
Rockwood Research, a subsidiary of Farm Journal, Inc. It was prepared 
for the Nebraska Wheat Growers Association, the American Corn Growers 
Association, and the Nebraska Farmers Union.
  I just want to say what the method was here. The method was that 
representative data was drawn from 1,000 wheat and corn growers 
throughout the United States. They have here a table of how many were 
contacted in each State. For example, in the State of Illinois, 55 corn 
growers and 33 wheat growers, for a total of 88, were contacted; in 
Idaho, 1 corn grower, 12 wheat growers, a total of 13; in Iowa, 72 corn 
growers, no wheat growers; in Kansas, 9 corn growers, 72 wheat growers, 
et cetera. All over the United States, from every State, from Alabama 
to Wyoming, farmers were contacted on this poll--500 corn growers and 
500 wheat growers, calls made randomly. I will not go through all the 
questions, but I would like to highlight just a couple.
  Question No. 7: ``Congress should modify the current farm program?'' 
Yes or no. Seventy-six point nine percent said yes, 17.7 percent said 
no.
  Question No. 8: ``Congress should lift loan caps and raise loan rates 
59 cents per bushel on wheat and 32 cents on corn.'' That is what is in 
the package of amendments in the Chamber right now. And 72.5 said yes, 
19.4 percent said no.
  Overwhelming, 3 to 1--actually over 3 to 1--said that we have to 
raise the loan rates, we have to modify the farm program, and we ought 
to lift the caps.
  There are a couple of other findings in this poll, one here that I 
found very illuminating. Question No. 13: ``A farm program should 
retain planting flexibility and include a farmer-owned and farmer-
controlled grain reserve?'' Eighty-five point nine percent, yes; 9.9 
percent, no. Think about it. Planting flexibility with a farmer-owned 
and farmer-controlled grain reserve--almost 86 percent of the farmers 
polled said yes. There is no question about that.
  Well, that is what is in the package of amendments before us. We have 
planting flexibility, we provide standby authority for the Secretary of 
Agriculture to provide for storage payments to farmers, and then 
lifting the caps from the loan rates would give the farmer marketing 
flexibility, that ability to keep his own grain and market it as he 
wants to over the next several months. Eighty-six percent of those 
polled said yes, they were in favor of that.
  Madam President, I am going to put a copy of this poll on every 
Senator's desk, and I hope that each Senator will read this poll very 
carefully before a vote is taken on our package of amendments. I 
understand there is going to be a motion to table. I am just hopeful 
that every Senator will take a look at these poll results and see what 
the farmers are saying. This is not my poll. It is not a skewed poll. 
The poll was done by a reputable polling firm. One thousand farmers 
polled, random sampling. It is not even close--it is not even close--
about whether farmers want to raise the loan rates or not. It is 
overwhelmingly positive to get the loan rates raised and to provide for 
a farmer-owned reserve so that farmers can market their own grain.
  Madam President, I ask unanimous consent to print the results of this 
poll in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

[[Page S10297]]

                          U.S. Farm Bill Study

  (Prepared by: Rockwood Research, a subsidiary of Farm Journal, Inc.)

(Prepared for Nebraska Wheat Growers Association, American Corn Growers 
                Association, and Nebraska Farmers Union)


                               background

       The ``Freedom to Farm'' bill was intended to give farmers 
     financial stability despite the fluctuating market. Nebraska 
     Wheat Growers Association, along with American Corn Growers 
     Association and Nebraska and National Farmers Union, are 
     concerned that the bill is not effective considering the 
     current U.S. economic position. This study investigates the 
     attitudes of U.S. farmers in regards to the current and 
     future economic climate associated with the farm bill.


                                purpose

       To identify farmers' attitudes concerning the current U.S. 
     farm economy and farm program. Results will be used to 
     influence future U.S. economic policy.


                               objectives

       To identify growers' attitudes concerning current U.S. farm 
     policies.
       To measure the need for U.S. farm policy reform.


                                 method

       Representative data was drawn from 1000 wheat and corn 
     growers throughout the United States. The sample was drawn 
     from FARMAIL, a database of Farm Journal, Inc. Respondents 
     raised a minimum of 100 acres of wheat or corn. All 
     interviews were conducted at Rockwood Research Corporation's 
     interviewing facilities in River Falls, WI and Webster City, 
     IA. Professionally trained agricultural interviewers 
     conducted the survey between September 4 and September 10, 
     1998. The collected data were edited, processed and tabulated 
     in Rockwood's in-house data processing department. Numbers 
     have been weighted to accurately represent the number of 
     growers per state.


                          SAMPLE DISTRIBUTION

       The sample was drawn from 500 corn growers and 500 wheat 
     growers in the United States. Calls were randomly made 
     throughout the United States resulting in the below 
     distribution:

------------------------------------------------------------------------
                                               Corn      Wheat
                   State                     Growers    Growers    Total
------------------------------------------------------------------------
Alabama...................................          5          0       5
Arkansas..................................          1          8       9
California................................          2          4       6
Colorado..................................          4         11      15
Florida...................................          2          0       2
Georgia...................................          8          0       8
Idaho.....................................          1         12      13
Illinois..................................         55         33      88
Indiana...................................         37         25      62
Iowa......................................         72          0      72
Kansas....................................          9         72      81
Kentucky..................................         17          0      17
Louisiana.................................          1          0       1
Maryland..................................          5          5      10
Michigan..................................         19         24      43
Minnesota.................................         42         25      67
Mississippi...............................          3          2       5
Missouri..................................         21          0      21
Montana...................................          0         17      17
Nebraska..................................         29         25      54
New Jersey................................          1          0       1
New Mexico................................          0          2       2
New York..................................         10          0      10
North Carolina............................         13         13      26
North Dakota..............................          0         45      45
Ohio......................................         37         47      84
Oklahoma..................................          0         33      33
Oregon....................................          0          6       6
Pennsylvania..............................         21         15      36
South Carolina............................          4          0       4
South Dakota..............................         16         24      40
Tennessee.................................          9          0       9
Texas.....................................          7         29      36
Utah......................................          1          2       3
Vermont...................................          1          0       1
Virginia..................................          6          7      13
Washington................................          1         10      11
West Virginia.............................          1          0       1
Wisconsin.................................         36          0      36
Wyoming...................................          0          1       1
                                           -----------------------------
    Total.................................        500        500   1,000
------------------------------------------------------------------------
Note: Numbers are weighted to accurately represent the number of growers
  per state.


--------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Question                                                A       D      DK                             A         D
--------------------------------------------------------------------------------------------------------------------------------------------------------
3. large agribusiness concentration in agriculture markets causes lower ag                 65.1    25.8     9.1                           71.6      28.4
 commodity prices..............................................................
4. The current farm bill providers an adequate income safety net to protect                23.9    72.8     3.4                           24.7      75.3
 farm income during years of low commodity prices..............................
5. At today's prices, I see myself farming five years from now.................            39.8    55.1     5.1                           41.9      58.1
6. I would encourage my children to enter farming..............................            32.0    61.5     6.5                           34.2      65.8
7. Congress should modify the current farm program.............................            76.9    17.7     5.4                           81.3      18.7
8. Congress should lift loan caps and raise loan rates 59 centes per bushel on             72.5    19.4     8.1                           78.9      21.1
 wheat and 32 cents on com.....................................................
9. US agriculture has the ability to produce more total farm goods than can be             73.8    18.6     7.6                           79.8      20.2
 sold at profitable levels.....................................................
10. A farm program should reduce production in exchange for increased income               56.3    37.3     6.4                           60.2      39.8
 safety net support............................................................
11. See below.
12. A farm program should retain planting flexibility and include normal crop              74.4    20.2     5.3                           78.6      21.4
 acreage set-asides............................................................
13. A farm program should retain planting flexibility and include a farmer-                85.9     9.9     4.2                           89.7      10.3
 owned and farmer-controlled grain reserve.....................................
14. The US government should stop the importation of grains into the US market             85.0    13.2     1.9                           86.6      13.4
 that are in surplus or abundant supply, such as Canadian Wheat................
15. The US should not export its farm commodities at prices below the cost of              57.2    38.5     4.3                           59.7      40.3
 production....................................................................
16. The Conservation Reserve Program (CRP) should be expanded..................            61.5    31.8     6.7                           65.9      34.1
17. I expect my banker to continue to to provide me with necessary operating               76.7    13.7     9.6                           84.8      15.2
 loans under the same loan provisions as he extended me in the past............
                                                                                     GF      LF       B      DK                    GF       LF         B
                                                                                ------------------------------------------------------------------------
18. Are you primarily a grain farmer or livestock feeder?......................    56.7    14.9    27.9     0.4                  56.9     15.0      28.9
                                                                                    05%    010%    015%     0AA      0DK
                                                                                ------------------------------------------------------------------------
11. How much cutback in production is acceptable?..............................     8.6    13.9     5.6    51.7     20.1       (Don't
                                                                                                                                knows
                                                                                                                            included)
                                                                                   10.8    17.4     7.0    64.8         (Don't knows not included)
--------------------------------------------------------------------------------------------------------------------------------------------------------

  Mr. HARKIN. Madam President, I heard some talk around here that some 
on the other side of the aisle are talking about coming up with a new 
program called lost market compensation payments, or something like 
that. So, as I understand it, it would just be a set rate of payments. 
They are going to come up with money and give it out to farmers like 
another AMTA payment.
  So what is the difference between that and taking the caps off the 
loan rates? A big difference. Keep in mind, if we have a direct 
payment, if you just give the money out to farmers this fall, and if 
the prices go up next year--which we all hope they do--the Government 
is out that money. If we have an increased loan rate and farmers can 
take that loan and pay their bills, and if the prices go up next year 
over 15 months--because that is what we put in the legislation, a 15-
month loan--if, over the next 15 months, the prices go up, farmers can 
sell their grain, pay the loan back to the Government with interest, 
and, therefore, the Government would not necessarily be out all that 
money. The income protection is there, but if prices rise the 
Government will not bear as much cost.
  As I understand it the idea is to come up with this lost market 
compensation payment--it certainly sounds fancy to me--to pay out some 
amount of money regardless of what prices may do over the course of the 
marketing year. The loan rate approach is responsive to changes in 
market prices and the need for farm income protection. Again, keep in 
mind, if the money just goes out in direct AMTA-type payments and the 
price goes up next year, the Government is out that money. You do not 
get that money back.
  Second, if you make that direct payment to farmers, a lot of that 
direct payment will not go to farmers. Like the AMTA payment, it will 
go to landowners, it will go to landlords, and it may go to a number of 
people who will not even be farming next year. I heard that concern a 
lot in Iowa. In July we passed a bill to allow up-front payment of AMTA 
payments, we brought up next year's payment to this fall. There are 
going to be a number of cases where people who took that early AMTA 
payment are not around to be farming next year, and the person who is 
farming the land next year will get nothing. Lifting the caps from the 
marketing loan rates goes to benefit the farmer. It goes to that 
producer out there who really needs the income protection this fall and 
over the next 12 to 15 months.
  The next point to keep in mind, and the difference between raising 
the loan rates and the new AMTA-type payments, is that with increasing 
the loan rate, even though it is a marketing loan, we believe it will 
provide some price stability. It will help farmers conduct more orderly 
marketing of commodities and help to lessen the erosion of prices 
because farmers will not be under such pressure to sell. A direct 
payment out will not have this effect. And it will mean that farmers 
this fall without an adequate loan rate will have less of an 
opportunity to avoid just having to dump their grain on the market for 
whatever they get. So a marketing loan at a better level, particularly 
along with some storage payments, can head off a lot of problems. 
Without them we are likely to have more grain sitting on the siding, 
grain

[[Page S10298]]

dumped on the ground and more of it rotting out there because we do not 
have the railcars to move it all at once.
  So any way you cut it, any way you want to look at it, lifting the 
loan rate caps makes sense. From the standpoint of how much we are 
asking the taxpayers to bear the burden, who is going to receive the 
help--whether it is farmers or landlords--and whether we are going to 
do something to stop the downward trend of prices, any way you look at 
it, removing the caps on loan rates and providing standby authority for 
storage payments is in our best interest.
  Finally, there are those who might say if you raise the loan rates, 
you are going to cut us out of foreign markets. What nonsense. Keep in 
mind that these are marketing loans we are addressing today. They do 
not price the U.S. out of markets. And, in any event, I have often 
wondered what good does it do if a farmer has to sell a bushel of grain 
for 10 cents a bushel because that is the only way to export the grain? 
By that reasoning we will drive all our farmers out of business. Taking 
the cap off of loan rates will help farmers stay in business to produce 
the grain we are going to need to be a reliable and adequate supplier 
for the world market, and it will help our farmers and not just those 
who may happen to own land.
  Madam President, we are, right now, on the verge of losing thousands 
and thousands more farmers, mainly young farmers, a lot of them who 
have a heavy debt load who are paying it off, trying to get a foothold 
in agriculture. They are smart. They are aggressive. They are good 
managers. But they are being driven out of agriculture by forces beyond 
their control. Now our efforts to improve the farm bill to help them 
seems blocked by an ideological devotion to every aspect of the present 
farm bill. I don't mind. I know people have ideologies and they believe 
certain things and they enact them into law. That is fine. It happens 
all the time. But at some point, practicality has to rule. However good 
the so-called Freedom to Farm was for the last couple of years because 
we had good export markets, it is not working now to address this 
crisis. If it is not working, change it. Are we so rigid, are we so 
cast in stone that because we passed a bill a couple of years ago we 
can't do anything about that?
  Yes, we can. The farm bill is not the Ten Commandments. Improving it 
doesn't require a constitutional amendment. It just requires 51 votes; 
that is all, just 51 votes. As I said earlier, when you look at those 
poll results, when you see more than a three-to-one ratio of farmers 
saying we ought to raise the loan rates, then you know that we ought to 
be doing it to help them survive this crisis.
  Madam President, over the weekend, farmers, bankers and others with 
real knowledge of the farm economic situation told me that by next 
February, March, and April, we will likely have many farmers in this 
country going to the banks to get their loans for planting and being 
told by the bankers who look at their balance sheets, ``I am sorry, you 
simply do not qualify.''
  I also point out that we have a lot of farmers with Government-backed 
loans who are making it now; they are farming. But what is going to 
happen next spring if they can't make it and they can't get the money 
to put in another crop? What is going to happen to all the Government-
backed loans that we have out to farmers?
  Again, we have to act, and we have to act soon. We cannot wait until 
next February, March, or April. It will be too late. The one thing I 
heard loudly and clearly this weekend in my State of Iowa was that if 
Congress doesn't do something before we adjourn, we might as well not 
do anything at all next year. That came through loudly and clearly.
  Another message that came through loudly and clearly is that we don't 
need another direct payment going out in a lump sum because the benefit 
of those payments flows so heavily to landowners, and the farmer got 
precious little.
  I had a number of farmers tell me this weekend that some of those 
advanced payments that we gave, or are sending out this fall, a number 
of those people getting those payments won't even be farming next 
year--won't even be farming. So we are giving them a farm payment that 
would have gone next year to farmers, and they are not even farming, 
but they are going to get the payment this fall. That doesn't sound 
like a very wise policy to me.
  The wisest thing for us to do is what has proven to be effective and 
what farmers know is effective and the poll results show: Lift the caps 
on marketing loan rates, extend the period to 15 months, provide the 
Secretary of Agriculture the authority to make storage payments and 
increase the amount of indemnity payments we are going to make. The 
amount we passed in July is not sufficient. Do those things, and then 
we can really help farm families to survive, we can save our economy, 
and remain competitive in world markets.
  Madam President, I yield the floor.
  Mr. THOMAS addressed the Chair.
  The PRESIDING OFFICER. The Senator from Wyoming is recognized.
  Mr. THOMAS. What is the current business?
  The PRESIDING OFFICER. The pending question is the Harkin amendment 
No. 3580, which is a first-degree amendment to S. 2237, the Interior 
appropriations bill for fiscal year 1999.
  Mr. THOMAS. Thank you. Madam President, I am going to speak a few 
minutes on the amendment and, in particular, on the farmers' and 
ranchers' situation.
  Madam President, almost all of us have farmers and ranchers in our 
areas. Certainly in Wyoming, agriculture is one of the three economic 
interests that we have, most of us do, so all of us are concerned about 
agriculture. And we are in a time when agriculture needs, indeed, are 
our concern, and more than our concern, it needs some action. Many of 
us have been working for some time to find some areas in which 
agriculture can be strengthened, in which agriculture can be helped and 
assisted through a very hard time.
  I have listened this afternoon to several Senators representing their 
constituents and talking about agriculture. Each of them has 
represented a point of view, and that is basically to seek to return to 
the farm program time, and that is the issue here. I don't think there 
will be a soul in this place who doesn't want to assist agriculture. 
There won't be anyone in this Senate who doesn't think we ought to do 
something to strengthen this segment of our economy, but there is a 
division of view as to whether we seek to do some things to help make 
the transition from agriculture, as we have known it over the years--
with acreage limitations, with farm subsidies and those kinds of 
things--to a market enterprise which we are now seeking to do.
  Our real challenge is to assist in continuing to move toward market 
agriculture which, at least in the State I represent, is the 
predominant view. People know that long-term agriculture will be 
stronger. Agriculture will be better. Our production will be more 
efficient in a market economy. What we are really talking about is how 
can we best do this, how can we best help agriculture, how can we best 
pull through this kind of a situation, and at the same time continue to 
help agriculture move to a market economy.
  Some have spoken about their contacts over the last week and, indeed, 
over the last month. I spent August in Wyoming talking with farmers and 
ranchers about it. Interestingly enough, we have three economic areas, 
basically, in my State: One is agriculture; one is mineral extraction; 
and one is visitation and tourism. Frankly, agriculture and minerals 
are both in tough shape. Oil, for example, is the cheapest it has been 
in history, I think. So we do have some concerns.
  Let me talk to you about some of the things that agricultural 
producers said to me in terms of long-term recommendations.
  One is consumer demand. For instance, in the beef industry, we need 
to strengthen consumer demand. Certainly what has happened in Asia has 
an impact on agriculture, particularly on exports. Some 40 percent of 
agricultural production goes into exports.

  Meat labeling, which we are moving toward doing--we need meat 
labeling so we know the origin of meat, whether it is imported, whether 
it is domestic, so buyers can make a choice.
  In my State, we have other kinds of things. Fifty percent of our 
State belongs to the Federal Government and is

[[Page S10299]]

Federal lands. We have a good deal of problems with animal damage 
control, with predators and these kinds of things. These are also some 
of the issues.
  The idea that you simply try to go back to a controlled farming 
program is not a solution to all of agriculture. I understand the 
Senator from Iowa is concerned about the basic crops--wheat and corn 
and grains. That is a farm program kind of a thing.
  The agricultural problem is not confined only to those commodities. I 
am told, with the market, in rural areas, they are talking about fast 
track, for example, doing something about increasing markets in South 
America, doing something about increasing markets in Asia to strengthen 
access, increase consumer demand. These are the things that were told 
to me by agriculturists who want to do things that will be of long-term 
benefit.
  We need to talk about control programs for grasshoppers. We haven't 
done as well. We are not funding the Grasshopper Control Program as we 
did. Those are things having an impact on agriculture, not simply going 
back to a program that we had before to increase the loan rate. That is 
a remedy, but that is certainly not the only remedy and, indeed, 
probably not the best remedy.
  We need to be doing some things now and, indeed, we are. We need to 
continue to do that. The $5.5 billion in transition payments and 
accelerated payments that have been made to farm producers designed to 
help make the transition from a controlled Government farm program to a 
market program, that is what is expected; that is what is being done. 
We will do something, hopefully, about fast-track negotiations which 
are being held up, as you know.
  The Crop Insurance Program is one that needs to be changed. Crop 
insurance is based on last year's production, last year's crop. If you 
didn't have a crop last year because of the drought, or whatever, then 
your crop insurance is virtually of no value.
  We need to do something about tax legislation. We need capital gains 
relief in agriculture. Probably of any industry, the people who are in 
agriculture have more money invested in their facilities for the amount 
of cash flow of any industry.
  There are farm savings accounts and income averaging which we passed 
and need to make permanent. Agriculture is traditionally profitable one 
year, less profitable another year. There needs to be income averaging.
  They need 100 percent deductibility of self-employed health care, 
which is one of the things that farmers and ranchers need to put them 
on an even par with others.
  These are the kinds of things that we are, indeed, talking about 
doing and, indeed, must do in order to allow this transition to take 
place.
  There has been talk about a program for an increased conservation 
reserve, which would cost, I suppose, $2.5 billion to actually take 
some of the production out of production and put into a conservation 
area so that we can have impact on the prices. We can do this.
  These are the things that are underway now, as a matter of fact, and 
have been for some time. Some of them were passed before we left in 
August. And we should continue to do that.

  So I think everyone here takes seriously the difficulties that we are 
having in agriculture. Everyone here knows that we need to do some 
things to keep agriculturists in business, to help level out income 
over years when it is up and down--as it traditionally is--to do 
something about crop insurance so that when you are put up to the 
vagaries of weather and those kinds of things that there is some kind 
of an income support that you can depend on, but one that is part of 
the market, the market system.
  We surely need to go back to the beginning to open more foreign 
markets so we can do that. We have to do something about unilateral 
sanctions, which we already did at least partially. And you remember in 
Pakistan when they fired off the nuclear thing, immediately sanctions 
went on, the fact that we could not sell agricultural products there. 
That has been changed and, indeed, should be changed so we have that 
market available.
  So these are the kinds of things. I hope that we take a look at what 
really helps farmers and ranchers make a transition into the 
marketplace, in which I believe strongly. Frankly, the people in my 
State who I talk to believe also the best long-term direction for both 
agriculture and producers, and for consumers, is to have a market 
demand so that the production is, indeed, for the market, that 
production is not simply for some kind of a loan in which it goes into 
storage and becomes an obligation of the Federal Government. We have 
been through that. We have been through that program.
  I happen to have been in agriculture almost all my life. My first job 
when I got out of the Marine Corps was with the Farm Bureau. I worked 
with the Farm Bureau for a very long time at the local level, the 
American Farm Bureau.
  I just came back from my home college, the University of Wyoming, 
where we had Agriculture Appreciation Weekend this weekend. This is an 
area about which I feel very strongly. I hope that we make some moves 
before we leave, as the Senator from Iowa said. We should do that.
  We have begun. We started a number of things that need to be 
continued now. We need to do more short-term things that will have 
impact this year, but also the long-term kinds of changes that allow 
this transition to take place, that allow farmers to produce for the 
market, that allow consumers to have a choice as to what it is they 
buy, that farmers are not dependent upon the Federal Government 
paycheck but indeed produce the kinds of things in the market, that we 
can increase these markets. We have the most efficient agriculture in 
the world, and there is a great deal of market available there as the 
world changes.
  Let me say, again, that there is no question, I do not think among 
all of us, there needs to be something done. The real question is, What 
do we do? It is a philosophical question to a large extent, not whether 
you help but how in fact you do it, how in fact that help will impact 
over a period of time as we make the transition to a marketplace.
  Madam President, I hope that we continue to talk about this. And I am 
sure we will.
  Mr. FAIRCLOTH. Mr. President, I rise to address the farm crisis, and 
it is indeed a farm crisis. Prices are at historic lows for many 
commodities. That fact has received much of the attention.
  Well, in North Carolina, that is just a part of the problem. My 
tobacco farmers also faced a direct attack on our billion-dollar 
tobacco crop from the White House. Further, my tobacco farmers were hit 
with a 17% quota cut last year, so they're facing dire times.
  The Daschle amendment is not the answer for them. Really, it is not 
the answer for most farmers, it just doesn't address the root issues. 
It will not help in the short term. It will not help in the long term.
  The Daschle amendment ignores the tobacco farmers. North Carolina 
tobacco farmers face the effects of drought--and hurricanes--but this 
amendment fails to address their problems. In fact, it's just not 
geared for the Southeastern farmers, but for the Midwest and West.
  My tobacco farmers can't boost their exports to relieve their crisis 
not because there is no foreign market, but because it is government 
policy to prohibit efforts to help them build export markets. All the 
other commodities are on the table at the trade negotiations, but it is 
official policy to ignore tens of thousands of tobacco farmers. That is 
wrong.
  We need a farm assistance plan that includes all farmers and that 
does not ignore North Carolinians.
  I suggest the absence of a quorum.
  The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. LUGAR. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LUGAR. Madam President, I rise to oppose the amendment offered by 
the distinguished ranking member of the Agriculture Committee. I 
appreciate his sincerity, scholarship, research, and his passion, but 
the solution that he offers, in my judgment, is the wrong one.
  Republicans and Democrats are concerned about the financial stress in 
the farm sector. It is substantial. We have

[[Page S10300]]

worked together on many initiatives aimed at strengthening the long-run 
health of our farm and ranch economy. There is, unfortunately, no 
single magic bullet that will make all of our farmers prosperous. But 
several constructive steps have been taken. I will explain later why 
raising loan rate caps would be unwise, but first it is appropriate to 
mention a few of the constructive steps that farm organizations have 
suggested would help American agriculture.
  Nearly all farm groups strongly support giving the President fast-
track negotiating authority. The Senate Finance Committee has reported, 
in fact, a comprehensive trade bill containing a renewal of fast track. 
The majority leader, Senator Lott, intends that the Senate act upon 
that bill in this session. Our House colleagues have also pledged to 
act on fast-track legislation.
  Madam President, I start with that point because, very clearly, we 
must give the President fast-track authority. By that I mean the 
ability to submit to the Senate, on an up-or-down basis, a trade treaty 
negotiated with others, and in the case of the World Trade Organization 
negotiations next year, over 100 countries. If there is not the ability 
to deal with that legislation or that treaty on an up-or-down basis--
and the normal course of the Senate would be to offer amendments--then 
other nations will feel free to offer amendments and the negotiations 
will founder.
  Madam President, I mention fast-track authority, and so do most farm 
groups, first because the export side of our farm business is the 
growth side. As a matter of fact, in recent years most Americans must 
realize that about a third of all we produce on our farms has been 
exported. That is a very large part of demand.
  The current crisis on the farm is of two origins. One is bad weather 
in some sections of our country and, in some cases, bad weather for 
several years running. As we have heard testimony from the 
distinguished Senators from South Dakota and North Dakota, parts of 
their States have reported conditions impossible for 4 years to get a 
crop. We have noticed very considerable drought this year in Texas, in 
Oklahoma, and in Georgia. And the Senate has acted appropriately.
  When the appropriations bill came before the Senate, the agriculture 
appropriations bill--and it was managed very adroitly by the 
distinguished Senator from Mississippi, Senator Cochran--$500 million 
of so-called indemnity payments were set aside, and that amount of 
money is in a conference between the House and the Senate now. The 
thrust of the indemnity payments was to recognize that although we are 
inexact in knowing exactly what damages should be assessed, there has 
been a great deal of pain and a formula must be worked out. That would 
be helpful to those farmers in those States and those regions that have 
had extraordinarily bad luck from the weather.
  Farming is always a situation of potential bad luck from the weather. 
No farm in this country is immune from those natural difficulties. That 
is a part of the excitement, risk, and the reward situation. 
Nevertheless, the Senate reacted appropriately, in my judgment, and now 
in conference a discussion about a half billion dollars of indemnity 
payments is proceeding.
  The other reason that a farm crisis has occurred is that the 
Malaysian economy, the Thai economy, the South Korean economy, and the 
Indonesian economy all went into disastrous tailspins for a variety of 
reasons. But whatever may have been the reasons, agricultural demand 
coming from our Asian customers stopped cold. Our best estimates are 
that about one-third of our exports to Asia, which we would have 
counted on this year--there is a very strong trend showing year by year 
gains, and as Asian citizens have had more income and have tried to 
upgrade their diets, they have become very good customers of farmers in 
this country.
  In any event, about a third of that demand is gone, and a third of 
all of our exports were headed to Asia. That means that roughly 10 
percent of the entire demand for agricultural products in this country 
has vanished--vanished literally overnight. That has had a devastating 
impact, obviously, when demand heads into the tank at a time in which 
supply is huge. The supply of our corn crop, for example, is now going 
to be perhaps the second largest crop in the history of the country, 
and the soybean crop is the largest ever. Wheat farmers have already 
been heard from, and their pain has been felt. That registers both in 
the indemnity payment situation as well as a number of steps that the 
Senate and House have taken, including, as you will recall, an 
extraordinary debate on the Glenn amendment on Pakistan and India. The 
Glenn amendment required sanctions on both of those countries after 
they both tested nuclear weapons. But the Senate and the House voted 
rapidly to exempt Pakistan from that situation with regard to wheat so 
that an auction going on in Pakistan could continue, and, as a matter 
of fact, Pakistan bought, apparently, about 100 thousand metric tons 
bushels of wheat from the United States due to that extraordinary 
action. We had been conscious of the lack of demand for wheat and we 
are conscious of that lack of demand for corn and for soybeans.

  As the distinguished Senator from Wyoming who preceded me on the 
floor pointed out, American agriculture is not entirely grain. It is 
not entirely vegetables or fruits. It includes livestock. Of course, 
one of the interesting aspects of agriculture is that as we dwell upon 
the price of feed grains, it has the worst effect on the cost of 
raising cattle or raising hogs. There are many farmers who have 
productions that include both livestock and grain. Many do so 
deliberately so that they have hedges either way.
  But, in any event, in the totality of American agriculture, the 
important point this year is weather and Asia. Worse still is that the 
Asian situation was not contained there. The Asian problems may have 
been precipitated or extended by the fact that the world appears to be 
in the throes of a deflationary spiral, not only for agricultural 
commodities, but also for metals, minerals and for oil. All of these 
situations have been in what could be called a deflationary mode. The 
world has not seen this type of phenomenon for a half a century.
  It is not clear who the winners and losers are from deflation. There 
are many of us anecdotically going to a filling station to fill up a 
tank who rejoice in the fact that sometimes you can buy a gallon of 
gasoline for less than $1 these days. There is not a great hue and cry 
on the part of the public to raise the price of gasoline to $1.20 or 
$1.50. As a matter of fact, we pocket the change without commenting and 
are simply pleased that some nice things come along in life 
unexpectedly.
  But, if you were in fact a Nigerian, a Venezuelan, or even a Russian, 
and you saw that a large portion of the income of your country comes 
from oil and that income has gone down precipitously, or if you were 
any country in the world that gained most of its hard currency and 
export from mineral extraction, you would find a first-class recession 
on your hands. That has compounded the problem, obviously, for many of 
the Asian countries, as well as the increasing number of difficulties 
in our own hemisphere. It is not clear, Madam President, where the 
fallout will end with regard to so-called developing countries and 
others that have currency crises. But each of these weaken export 
demand from the United States for agricultural products and 
increasingly for other manufactured products as well. We need to 
recognize that.
  There are speeches every year about shortfalls in prices. Some of 
these shortfalls occur every year as we approach our harvest and the 
market tries to sort out where the lows are going to be and a certain 
amount of speculation occurs. This time the real fear is that, given 
the harvest woes, the bounce back may not be very substantial if there 
is not somewhere the prospect that we are going to have sales.
  I noted in the Wall Street Journal last Friday, at least that day--
corn went down and beans went down. The problem pointed to by traders 
was that the export markets still looked weak. The article commented 
that wheat prospects looked somewhat better in the export markets--but 
not for corn and not for beans. That is a problem with which we are 
going to have to deal. That is why, Madam President, I pointed out that 
in the World Trade

[[Page S10301]]

Organization meeting next year we must have fast-track authority. It is 
essential if we are to expand substantially our export markets, which 
we must do if demand is to increase and if prices are to go up.
  Let me point out that farm groups also strongly support International 
Monetary Fund funding and reform. They know that we have to deal with 
the Asian demand, the potential for declining demand in Latin America, 
and restoring IMF funding.
  Madam President, the debates upon IMF have been hot and heavy on this 
floor, and in the committees. That has been true in the other body. 
Clearly, a number of Senators pointed out that the IMF may not have 
given the best prescriptions for a healthy return in Malaysia, 
Thailand, Indonesia, and Korea; that the IMF is far too opaque in terms 
of its deals; needs to be less secretive; that in fact prescriptions of 
raising taxes and lowering spending do not always work in economies and 
may not have been a realistic solution for Russia during the several 
times IMF money was given to that country. So, as a result, the 
Congress has not decided yet IMF funding. But, as I have pointed out, 
it is a very crucial situation. As a matter of fact, it is essential 
that we act in that area as well as the fast-track authority--two votes 
which leadership has promised.
  Agricultural groups want to maintain the viability of crop insurance 
and to improve it. In the debate today, considerable attention has been 
given to one of the failings of crop insurance. This failing is that 
should crop failure occur for several years, the producer's acreage 
production history falls, and his insurance premiums increase. We will 
have to reform crop insurance. But I would simply point out that there 
are a good number of debates, depending upon the standpoint of the 
observers, as to how that is to be done.
  For example, should there be a national premium for all farmers in 
all States and all locations regardless of risk that might be involved? 
Or should there be a premium based upon risk; upon the actuarial 
figures that show the history of a particular region or a particular 
crop? What should be the exposure of the taxpayers to the support of 
the insurance companies? We will need to face those problems of 
multicrop failures and actuarial soundness.
  There is currently a subsidy to the companies so that crop insurance 
will be provided universally, and, yet, there will be debates among 
Senators who are not in the agriculture business as to why this 
particular type of insurance is subsidized. But this year the Senate 
and the House--and the President by signing legislation as an amendment 
to the agricultural research bill--went a long way to stabilizing the 
situation for the next 5 years so that farmers would have a pretty good 
idea of the lay of the land, and so would the insurance providers. That 
was critically important.
  Madam President, part of our debate today on how agriculture is to be 
strengthened in the country was addressed in legislation that the 
Senate and the House passed and the President signed. We went a long 
way in the same legislation by providing specifically for agricultural 
research of all sorts, including pure research on those breakthroughs 
that we need to have if American agriculture is to be the most 
efficient, to be the lowest cost, and to be in a position to feed the 
world.
  I look forward in the Agriculture Committee to substantial hearings 
and efforts by all parties as we progress into the next session. But 
for now, we have most farmers in this country covered with some degree 
of crop insurance. The amount of coverage was the choice of the farmer. 
I would say from my own experience that I had to make choices with 
regard to coverage of my corn and soybean crops this year. I could take 
a chance by having no insurance. That really has been my policy for 
decades. Or I could assume that perhaps El Nino would not work out so 
well, or El Nino would come behind it, or there would be other 
difficulties. I had better be prudent, be certain that I cover certain 
acres, and guarantee a certain price or outcome. Premiums differ 
according to the amount of risk that is acceptable. That is what most 
prudent business people do, in agriculture, outside of agriculture, 
anywhere.

  Madam President, a number of farmers in the country apparently were 
not prudent and did not purchase adequate crop insurance coverage. 
Maybe they did not adequately understand the program, which means we 
have a large education job to do. But in any event, crop insurance 
reform is of the essence. That ought to be a part of our agenda. We 
have acted to mitigate the effects of economic sanctions on 
agriculture.
  Madam President, I wish that the Senate had passed the sanction 
reform legislation, S. 1413, which I offered as an amendment to the 
agriculture appropriations bill. I believe that would have been a very 
constructive and hopeful step not only for agriculture but for all of 
American exporters. I have suggested in that legislation--which is 
still alive and hopefully will be reconsidered this year or next year--
that there ought to be a systematic way in which our country considers 
economic sanctions. The President or the Congress ought to state what 
we are attempting to achieve, what the benchmarks will be for success, 
and what the costs will be of the sanctions to Americans and to 
American businesses, in terms of their effect on incomes and jobs. 
Finally, we ought to review sanctions each year. After 2 years they 
ought to be sunsetted unless the President or Congress specifically 
decides that a particular sanction is making a difference in our 
foreign policy.
  I proposed this prospectively--that is, for the future--as opposed to 
revisiting the sanctions of the past, although many Senators have 
offered bills that touch upon the past or offered sanction waivers to 
the President. Unhappily, my bill got caught up, in a way, in the 
problems we have had during the appropriations season. There is not 
much time and there is much work to do.
  But in any event, others have proposed sanction reform legislation. I 
have supported a number of those attempts because they take away 
roadblocks to exporting, and exporting addresses demand and increases 
price. Those who have talked eloquently today about price and income 
need to talk about exports, fast-track authority, and sanctions reform 
as opposed to policy options to store and overhang supplies for the 
future.
  Let me point out, Madam President, that with regard to food there is 
a special case to be made against sanctions. I have supported such 
legislation, and I have supported the thought that we ought not to have 
economic sanctions on food, and that it is an inhumane policy. It is 
not an effective policy with regard to our foreign policy, and 
resolving sanctions on food would be of great help to American 
agriculture and American farmers.
  We acted with corresponding dispatch in this body, as we did on the 
wheat sales to Pakistan, by speeding up the 1999 AMTA payments, the 
Freedom to Farm payments to farmers. This is a very large sum of cash. 
AMTA payments are made twice. The final 1998 payment for farmers will 
be made before the end of the fiscal year.
  But we suggested that beginning October 1, 1999, farmers all over 
America who need increased cash flow--and we have heard much discussion 
of that today--could apply for the total AMTA payment for fiscal year 
1999. Whether due to an emergency because of weather or because of the 
catastrophe in Asia, the cash flow could occur without taking out a 
loan; it is simply cash that the farmer in the program was guaranteed 
in the farm bill:

       But in any event, we decided to make that whole sum of 
     about $5.5 billion available, and available promptly, as soon 
     after October 1 as the U.S. Department of Agriculture could 
     work out the administrative details, possibly by October 15.

  This, I think, is an important point about the current farm bill. It 
has been suggested--I hope facetiously--by some today that it was the 
``Freedom to Fail'' bill as opposed to Freedom to Farm, but most people 
would say when it comes to the AMTA payments, they like it. They like 
the thought that for 7 years, if you are in the program, you get a 
payment, divorced entirely from supply and demand, from the Asian 
economic crisis, from anything else as a matter of fact. It is a so-
called transition from the farm bills of supply control of the past to 
the market-oriented programs that we have now.
  Let me just say finally that the Senate, while approving $500 million 
in disaster aid as a placeholder for conference, it was understood that 
there

[[Page S10302]]

may be additional monetary demands placed on the conference. I am not 
advocating that the sum be increased, but I am acknowledging that 
Senators from around the country have realized there has been further 
crop losses and plummeting prices. This legislation that is going to 
pass as a conference report, and hopefully will be signed by the 
President.
  Let me point out, Madam President, that in addition to these very 
substantial ways of bringing money to farmers and new and enhanced 
demand, many of us have supported Senator Grassley's farm and ranch 
risk management proposal and we will work diligently to encourage its 
inclusion in any new tax legislation this year.
  I was very pleased to note in the Wall Street Journal today that 
Congressman Archer, the distinguished chairman of the House Ways and 
Means Committee, as he initiates $80 billion of tax cuts, has created 
an accelerated estate tax exclusion. The $1 million exclusion would 
commence January 1, 1999.
  In the hearings we have had before the Senate Ag Committee, there 
have been two items that real live farmers said we need, we want. One 
is estate tax relief because it means the family farm really does have 
some possibility of remaining a family farm as opposed to confiscatory 
taxes intruding into an estate which is very heavy in real estate, 
land, livestock, buildings, and often very low in cash. So this is a 
critical item if you are a family farmer, and I am. This is critical, 
at least as I take a look at it, from the perspective of all the people 
I know in Indiana who are involved in family farming. This is real 
change in the economic aspects for this year and for many years for the 
continuity of farm life as we know it. So that is an important item.
  The second thing people came in to say is, year by year, the most 
important thing you could do for us is to give us 100 percent 
deductibility of our health payments. For the average family farmer 
farming, say, 500 acres or so in Indiana, that often is an additional 
$4,000 or $5,000 added to the bottom line. That is a big piece of 
change.
  The price effects changes that would come from removing the cap on 
the loan rate amount to about a 15-cent change, a 15-cent change in the 
price of a bushel of corn. It takes a lot of additional bushels to add 
up to $5,000 in the bottom line. A learned study just performed by the 
Food Agriculture and Policy Research Institute, and commissioned by the 
distinguished ranking member, Senator Harkin, determined this.
  Congressman Archer is proposing in this bill that we go to 100-
percent exemption promptly. That would be true for all Americans, and 
that is true of the estate tax situation. These are not proposals that 
are made specifically for farmers.
  I make that point because, although, quite properly, we are concerned 
with agricultural America, Senators have other people in their States 
in addition to farmers. In fact, some States hardly have very many 
farmers at all. What we are talking about, for example, in raising the 
loan caps is what the Congressional Budget Office now has estimated as 
a $5 billion new expenditure. That means that $5 billion would go from 
all the other taxpayers of the United States to some specific taxpayers 
who are essentially grain farmers. Few Americans may understand that 
transaction, that we have today been debating whether to give up $5 
billion to grain farmers. But that is a huge transfer of income to a 
small group.
  What I think is more constructive is a proposal such as that of the 
distinguished chairman of the House Ways and Means Committee in which 
he said estate taxes apply to all, including farmers. Farmers are 16 
times more likely to pay estate taxes, for example, than other people. 
But this legislation is not limited to farmers or grain farmers. It is 
for all of us, and is true of the deductibility of those who pay their 
medical payments as individual persons.
  I think it is, likewise, important to point out that Congressman 
Archer was quite specific on one of his proposals. He suggested that a 
provision retroactive to January 1, 1998--that is the beginning of this 
year--would expand to 5 years from 2, the number of tax years farmers 
can carry back losses.
  That would be very helpful. A number of us have been talking about 
income averaging. This really goes at it aggressively, a carry back to 
5 years. The Outlook, the publication of the USDA, points out that the 
last 5 years have been pretty good ones for agricultural America. This 
year is a downer with the weather and the Asia problems, but this has 
not always been the case. I can testify from my own farm that the last 
5 years have been very, very healthy years. And farmers all over 
America have repaid debt. And businesses that thrive at the crossroads 
have thrived with that type of farm income.
  Let me point out the FAIR Act, the Freedom to Farm Act, did not 
abolish price support loans. I think that is important to point out. In 
fairness, several Senators have pointed that out. They have said that 
there is a marketing loan in the farm bill. They disagree with the rate 
of that loan, or the price that is to be allowed--$1.89 for corn, for 
example, and would like for that to be over $2.20.
  But let me just take an example, once again, from my own operations. 
I ask the patience of the Senate with regard to that because I do not 
believe there are many Senators here today who are in farming. There 
may be a few. I know the distinguished Senator from Iowa, Senator 
Grassley, has long been involved with his family farm that I visited in 
Iowa. But there are not many. I am one of them, and today, Providence 
willing, soybeans will be shipped from harvest on my farm into the 
local elevator in Indianapolis. We will receive the marketing 
assistance loan at the rate of $5.26, which is being quoted today.
  I sold beans at an average pretty close to $6.75 to $6.80 over the 
last year. So $5.26 is well off of that. One could say it is 20 
percent, maybe more, maybe less. But I am happy to report that the 
yield per acre on the Lugar farm on beans looks to me to be way up. I 
think that is probably important, too. As a matter of fact, the cost 
per bushel will be down if the number of beans coming up is up.
  We have heard suggestions today that you have almost an immutable 
cost out there. It simply cannot be met by these loan deficiency 
payments or marketing assistance loans. But I point out, volume still 
counts. And volume we have this year--a record soybean crop in America. 
Not just on our farm, that specific location, but all over America; 
unparalleled number of bushels of beans, maybe only the second in 
history in terms of corn.
  So before all the dire predictions are visited, one has to take a 
look at some actual situations, some actual farmers who have some beans 
and have some corn. I point out the Freedom to Farm Act has not gotten 
into the loan deficiency payment until this year, and it is because low 
prices have kicked it in. But it would appear that this is going to be 
an additional $2 or $3 billion for grain farmers this year.
  I pointed out earlier that over $5 billion is kicking in early in the 
AMTA payments for cash flow purposes, an additional $2 or $3 billion in 
this LDP program, and at least $500 million in an indemnity payment in 
regard to the weather. The taxpayers of this country have not been 
grudging when it has come to trying to meet agricultural pain and 
difficulty this year. As a matter of fact they have been very generous. 
And farmers are saying we do not really want charity, we want sales, we 
want marketing, we want exports. Give us at least those tools in fast-
track authority in the IMF, in various other facilities. Give us 
taxation changes so as individuals who have to pay our own health 
insurance, we get the benefit of the deduction which in some strange 
way has been denied us. That is not the case in the industrial sector. 
Give us tax relief in terms of carry-back provisions so we can average 
out over the good years, and save the taxes. Give us estate tax relief.
  Let me just point out, we are not going to see, in my judgment, an 
end to the Asian crisis, the Russian crisis, or others, overnight. But 
we can exacerbate the problem inadvertently by doing the wrong thing. 
Higher loan rates have instant appeal--and I think that is obvious from 
the argumentation given here earlier today. But history shows they have 
long-term effects that are undesirable. A higher loan rate inevitably 
stimulates more production than the market can absorb.

[[Page S10303]]

  That is a very big point, Madam President, because, as a matter of 
fact, lower prices currently are very likely to send exactly different 
signals; namely, do not plant as much of those things in which you do 
not do well. There will be marginal changes. There are some farm 
operations geared up to plant a particular crop every year come hell or 
high water. There is no need for market signals, that is what the farm 
does. The question is, Can you lower costs so that you become 
profitable and efficient over the years? Most farmers have lowered 
costs. That is why we are the lowest cost producers in the world and 
why we are bound to be good when we export.
  But at the same time, the higher loan rate, by stimulating more 
production, will lead to a surplus and, thus, lower prices in the 
future, not higher prices. This amendment is clearly a short-term 
stimulus. If the projections of a $5 billion cost for taking off the 
loan cap is correct, $5 billion is going fairly immediately from some 
taxpayers in America to grain farmers, essentially. That will increase 
the income but, Madam President, the following year, the income comes 
down.
  Let me point out that a study that was completed for my distinguished 
colleague, Senator Harkin, points this out. Senator Harkin approached 
well-known researchers at the Food and Agricultural Policy Research 
Institute. They pointed out, as we might anticipate, that if, in fact, 
the amendment before us were to be adopted, the average price of corn 
for the current year, 1998-1999, would increase 10 cents a bushel. That 
would be the average increase for that corn this year--10 cents. Wheat 
prices would increase 15 cents and soybean prices 6 cents.
  But, unfortunately, they point out that the aftermath also indicates 
that in the following year, prices go down. Corn prices go down by 6 
cents and wheat prices go down by 10 cents below the baseline. Soybean 
prices, would be relatively flat, they say. Essentially, they evaluate 
the immediate income surge at about $4.56 billion, pretty close to the 
$5 billion estimated by CBO.
  They point out the obvious: if you have $5 billion injected into this 
situation averaged over 2 or 3 years, you still have more money than 
you had when the $5 billion went in. But they point out that absent a 
constant stream of this kind of activity--that is unleashing the caps, 
with continual injections of cash--that prices come down and so does 
overall income.
  (Mr. ROBERTS assumed the Chair.)
  Mr. LUGAR. That, Mr. President, is the basic problem with the 
amendment that has been offered by the distinguished Senator from Iowa. 
I simply point out that the basic and largest farm organizations in 
America have spotted this and they wrote to me on September 11. The 
organizations that have written and signed this letter are: American 
Farm Bureau Federation, American Sheep Industry Association, National 
Broiler Council, National Cattlemen's Beef Association, National Pork 
Producers Council and the National Turkey Federation--very sizable 
groups, covering general agriculture, as well as specific livestock and 
poultry situations.
  They say:

       Dear Chairman Lugar: As the largest market for feed grains 
     and soybean meal, the livestock and poultry producers are 
     concerned over the debate to change the farm program's non-
     recourse loan rate structure. While we empathize with the 
     market situation faced by feed grain farmers, we urge you to 
     consider the very serious potential impact that changes in 
     loan rates could have on all users of feed grains. With the 
     export market being so vitally important to American 
     agriculture, it is necessary to ensure that changes in 
     government policy not put animal agriculture at a competitive 
     disadvantage.
       Historically, non-recourse loan rates that do not reflect 
     market conditions have proven to affect producers' marketing 
     decisions, which in turn have led to government surpluses 
     that negatively pressure market price recovery. At a time 
     when all of agriculture is facing depressed marketing 
     conditions and export losses, we respectfully request that 
     the Committee examine alternative policy initiatives to 
     address low price conditions and help restore profitability 
     to farmers and livestock and poultry producers.

  I make that letter available, Mr. President, and ask unanimous 
consent that it be printed in the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                               September 11, 1998.
     Hon. Richard Lugar,
     Chairman, Senate Committee on Agriculture, Nutrition and 
         Forestry, Senate Russell 328, Washington, DC.
       Dear Chairman Lugar: As the largest market for feed grains 
     and soybean meal, the livestock and poultry producers are 
     concerned over the debate to change the farm program's non-
     recourse loan rate structure. While we empathize with the 
     market situation faced by feed grain farmers, we urge you to 
     consider the very serious potential impact that changes in 
     loan rates could have on all users of feed grains. With the 
     export market being so vitally important to American 
     agriculture, it is necessary to ensure that changes in 
     government policy not put animal agriculture at a competitive 
     disadvantage.
       Historically, non-recourse loan rates that do not reflect 
     market conditions have proven to affect producers' marketing 
     decisions, which in turn have led to government surpluses 
     that negatively pressure market price recovery. At a time 
     when all of agriculture is facing depressed marketing 
     conditions and export losses, we respectfully request that 
     the Committee examine alternative policy initiatives to 
     address low price conditions and help restore profitability 
     to farmers and livestock and poultry producers.
       We would urge that any resources that become available to 
     help improve agriculture's bottom line should focus on 
     providing assistance for weather-related disasters, 
     addressing domestic and international marketing problems, 
     providing income and trade assistance to address the loss of 
     exports and providing additional tax relief for farmers, 
     ranchers and livestock producers.
       Thank you for your consideration of our concerns. We look 
     forward to working with you and the Committee on these 
     matters.
           Sincerely,
     American Farm Bureau Federation.
     American Sheep Industry Association.
     National Broiler Council.
     National Cattlemen's Beef Association.
     National Pork Producers Council.
     National Turkey Federation.

  Mr. LUGAR. Mr. President, these agencies, including the American Farm 
Bureau and the sheep, broiler, beef and pork producers have made the 
essential point with regard to the removing of the cap on the marketing 
loans. Inevitably, the signals go out and the supplies increase. Even 
under the marketing loan concept, in which it is unlikely that there 
will be the buildup of forfeitures and the buildup of governmental 
storage that characterized previous situations, there still is a glut 
on the market. The surplus does not disappear.
  Price signals were out there for a purpose. They indicated who wanted 
to utilize the commodity, who could utilize the commodity. Tragically, 
in this country, we are utilizing commodities about as well as we are 
going to. The up-side potential that we talked about today on the 
export side is the difference. That is where the thrust has to occur. 
To have a domestic transfer of income simply hides the problem; it 
doesn't market the commodities. The costs do not decrease for farmers 
in the field, although much that we have done this year in terms of our 
research bill might assist people in bringing about lower costs.
  I commend all of my colleagues who have spoken to this issue today 
for their concern. They have spoken with sincerity. They are advocates 
of producers in their States and of American agriculture generally. 
Many are Members of the Senate Committee on Agriculture and participate 
regularly in trying to think along with the majority and minority how 
we can deal with these problems.
  But, Mr. President, we have debated, as was pointed out earlier by 
various Senators, this issue on at least a couple of occasions. On one 
occasion, the distinguished Senator from Montana, who is on the floor 
now, discussed a lengthening of payment of the loan rate. He did not 
press for a vote on that occasion. But then on the appropriations bill, 
an amendment was offered by the distinguished minority leader of the 
Senate, Senator Daschle, that had very similar characteristics with 
regard to the caps on the loan rate. The Senate voted 56 to 43 after 
extensive debate that took, as I recall, the better part of 4 hours on 
that occasion.
  We have revisited the issue for another 4 hours this afternoon, and 
it is probably worthy of considerably more attention. I suspect the 
problem is that the Senate is also attempting to deal with the Interior 
appropriations bill in addition to problems of agriculture.
  It will not be a good idea to adopt this amendment. I have listened 
carefully to others who have spoken. But

[[Page S10304]]

we ought to defeat this amendment. Therefore, Mr. President, I commend 
my colleagues for their sincerity, but after a consultation with and on 
behalf of the majority leader I move to table the amendment and ask for 
the yeas and nays.

  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be.
  The yeas and nays were ordered.
  Mr. LUGAR. The vote, I understand, Mr. President, will occur after 
the first vote that is now set for 5:30; is that correct?
  The PRESIDING OFFICER. The Senator is correct.
  Mr. LUGAR. I thank the Chair.

                          ____________________