[Congressional Record Volume 145, Number 53 (Monday, April 19, 1999)]
[Senate]
[Pages S3830-S3831]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                             FAMILY FARMERS

  Mr. DORGAN. Mr. President, I want to talk just for a moment about 
agriculture and the challenge facing agriculture.
  On Saturday, I was in an airplane and opened up a newspaper to an 
interesting article. I have spoken about agriculture and family farmers 
during the past weeks. I have talked about what is happening in our 
part of the country with the depopulation of middle America, rural 
communities drying up--shriveling like prunes, people moving out--not 
moving in, Main Street businesses boarding up, family farmers going 
broke, and nobody seemingly caring very much.
  The business section of the Minneapolis Tribune had two fascinating 
stories on the front page. They respond in a kind of perverse way to 
what is happening, both in this Chamber and also around the country 
with respect to the policy dealing with family farmers.

  The first article: ``Cargill Profits from Decline in Farm Prices; 53 
percent jump in earnings expected.'' Cargill is a large company and has 
always done quite well, I believe. It is a privately held company. It 
purchases agricultural products and is involved in a wide range of 
activities adding value to agricultural products.
  ``Cargill Profits from Decline in Farm Prices.'' Is that unusual? No. 
Big agribusinesses all too often are profiting from the misery of 
America's family farmers. Family farmers on the one side go broke; 
while Cargill sees a 53 percent jump in earnings. Cargill, 
incidentally, wants now to marry up with Continental Grain. Cargill and 
Continental want to get married, merge, and become bigger, with more 
market power.
  In the question of market power, it is reasonable to ask, who wins 
and who loses? Family farmers all too often lose, and those with the 
most market power win. ``Cargill Profits from the Decline in Farm 
Prices.'' You could wipe out the name ``Cargill'' and include any 
number of agribusinesses. I am not picking on Cargill; they just 
happened to be in this paper on Saturday.
  Let's go to the article on the bottom of the front page. Family 
farmers are going broke because commodity prices have collapsed. The 
price of wheat has collapsed. The article states, ``General Mills to 
boost cereal prices 2.5 percent'':

       General Mills, Inc., the maker of Cheerios, Wheaties and 
     Lucky Charms, is raising cereal prices an average of 2.5 
     percent.

  One might ask the question, in terms of public policy, What is going 
on in this country when the folks who gas up the tractor in the spring, 
borrow money to buy seed, fertilizer, plant the crop, harvest the 
wheat, sell it in the market, and then go broke because they are told 
that the wheat they produced from their fields has no value? But the 
people who buy that wheat and turn it into Cheerios or Wheaties or 
Lucky Charms, even though the prices of commodities have collapsed and 
they are paying the farmer less--in fact, so little that family farmers 
are going broke in record numbers--they say they need to boost cereal 
prices that people pay at the grocery store.
  I woke up this morning and I ate a bowl of cereal. I will not 
advertise which cereal it was, but I ate a bowl of cereal. I looked at 
the box, after I had seen this in the paper on Saturday, and I read the 
label about what is in this

[[Page S3831]]

cereal I am eating. I will tell you what is in the cereal--grain.
  So this company buys it from farmers, pays them a pittance, and then 
they puff it or crisp it or shred it. Once they have it all puffed and 
labeled as Puffed Wheat or Shredded Wheat, the process is all done. 
They have added the air to the grain or they have shredded it with a 
knife, then they put it on the grocery store shelf and charge a fortune 
for it.
  Buy a box of cereal at the grocery store and ask yourself whether you 
like that price. Now, they say it is not enough. While farmers are 
going broke, they say they need to boost cereal prices. Talk about a 
disconnection and evidence that the market system does not work in 
agriculture. There must surely be a golden rule here, the one that 
says--those who have the gold make the rules--there must be a golden 
rule here that says cereal manufacturers can increase prices with 
impunity while family farmers go broke because they are selling their 
grain at the elevator and are told that their food has no value.
  I mentioned last week an auction sale by a farm wife in North Dakota. 
She wrote a letter and said they were forced to sell out. She said her 
17-year-old son would not even come down, he stayed in bed during the 
day of the auction sale and refused to come down to witness the auction 
sale of this farm because he was heartbroken. It was breaking his 
heart.  It was breaking his heart that they were having to sell their 
farm. He wanted to farm.

  This is all about human misery, failure--and it is not their fault. 
It is not the family farmers' fault that commodity prices have 
collapsed at the same time we have a hungry world. Hundreds of millions 
of people go to bed with an ache in their belly every night because 
they do not have enough to eat, while our farmers are told their 
product has no value. And when companies take the farmers product and 
turn it into cereal by puffing it, then they send it to the grocery 
store, they say it not only has value, in fact, they are announcing a 
price increase. Yet, they have received record profits and now want to 
increase cereal prices.
  I want to put up a chart that shows the average annual return on 
equity for the major cereal manufacturers, 1993 to 1997: 29 percent, 24 
percent, 25 percent, 22 percent.
  Our family farmers are going broke raising the products that go into 
these cereals; and the largest corporations that make cereal are making 
very substantial returns on their equity. There is something wrong with 
that economic system. Some say, ``Well, that's just the way it works. 
The big get bigger and the small get phased out.'' If this country 
decides it is worth losing family farmers, it will have lost something 
of great value to our country.
  Some in this Chamber think having only giant agrifactories around in 
the future is fine. They will buy up farms from coast to coast. Only 
having large farms in America is not fine with me. This country will 
have taken a giant step backwards, unless we fundamentally change the 
farm law this year and provide a decent safety net for family farmers. 
We do it for another segment in our economy. We provide a safety net 
for workers with a minimum wage.
  Family farmers were told, under the current farm bill--about 3 years 
ago--``We're going to pull the safety net out from under you.'' And 
then, of course, prices collapsed, and the result is family farmers 
have no effective safety net.
  I just say that when you look at what is going on in the business 
page of the newspaper, ``Cargill profits from decline in farm prices'' 
and ``General Mills to boost cereal prices''--I do not mean to single 
out these two companies, they are doing what economic clout and power 
allows them to do--but it is unfair to family farmers.
  We have asked for substantial investigations by the Justice 
Department about the concentration of economic power and what it is 
doing to the family-sized farm. I hope the Justice Department will 
move, and move aggressively, on these issues. But more importantly, 
this Congress needs to decide, in the next few weeks, whether it wants 
family farmers left in this country. And if it does, we have to do a U-
turn on farm policy and reconnect a decent safety net for family-sized 
farms.
  I know what some people say, ``Well, all this is wonderful, but it's 
boring and it's not very important.'' It is critically important to 
families out there struggling to make a living.
  Will Rogers said, many years ago, ``You know, if on one day all the 
lawyers on Wall Street failed to show up for lunch, it wouldn't mean a 
thing for this country. But if one day all the cows in our country 
failed to show up to be milked, that would be a problem.'' What he was 
trying to describe was a difference between those who move paper around 
in America and those who produce real products on the farm, that are of 
real value and contribute to feeding our country. That admonition by 
Will Rogers is just as important today.
  I hope the Justice Department will take a look at the Cargill-
Continental merger with a critical eye, to say, why do we need 
corporations in this system, already too large, to get bigger? Why do 
we need them to impose their economic will on small producers? Why do 
we need to give them more economic clout to do that?
  I hope the Justice Department will look at market  concentration in 
meat packing and in a whole range of other areas, because those are the 
kinds of things that are undermining the foundation of America's family 
farms.

  A number of us will speak at greater length on these issue in the 
coming days, because we must convince this Congress that we have a 
responsibility to develop a farm program that works, one that tells 
family farmers: ``You matter to our future. And we want you to be able 
to make a decent living if you work hard on the family farm.''

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