[Congressional Record Volume 147, Number 178 (Thursday, December 20, 2001)]
[Senate]
[Pages S13915-S13918]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
FARM BILL
Mr. BAUCUS. Mr. President, I rise today to share my dissappointment
about the farm bill with you. It is vital that we get a strong bill
passed before we adjourn this year and, unfortunately, that isn't going
to happen. To put it simply: Our farmers and ranchers deserve more from
their representatives.
As long as I have been in the Senate, I have never seen the
agricultural community more united than they were yesterday in invoking
cloture and getting the Senate farm bill passed the floor this year.
The farm bill we passed out of committee is a good bill. It is not a
great bill. But it's a good step in the right direction. We had the
opportunity to work together to make this bill as comprehensive, full
of common sense, and strong as possible. My sleeves were rolled up and
I was dedicated to passing the farm bill this year. And I'm still
dedicated to passing a bill when we get back next month.
We need to support our Nation's agricultural producers. Now. We can't
wait until the current bill expires. We rely on our producers for a
safe and affordable food supply. Now they are relying on us for
survival.
Our agricultural producers are suffering. Years of low prices and
drought have made it nearly impossible for farmers and ranchers to
break even.
Low prices and drought have been disastrous not only to agricultural
producers, but also to the surrounding rural communities. When
producers are hurting, they can't invest in our economy. Agriculture is
the backbone of Montana's economy. And the backbone of rural America's
economy. The ripple effect is being felt throughout the country.
To help with the ongoing drought, it is important that we provide our
farmers and ranchers with natural disaster assistance. I included more
than $2 billion towards disaster assistance in my economic stimulus
bill, but that bill has fallen to the same fate as the farm bill--it's
at a stalemate this year. I'm dedicated to including disaster
assistance in the farm bill, in another economic stimulus bill, or any
other vehicle I see available. The assistance isn't something our ag
community can wait for and I'll keep working to see that they don't
have to.
The Senate's failure to pass a farm bill this year not only hurts our
producers, it hurts our lenders and our rural businesses as well. The
bill that we passed by the Senate Agriculture Committee includes a
Rural Development Title that would have provided rural economies with
much needed support. It's long overdue that we provide stability for
our agricultural producers and our rural economies.
Lenders in Montana and across the country are getting nervous as the
lean years of production are starting to add up. Their nervousness is
compounded now that we failed to act this year.
The time has come. We can no longer wait to repair the current farm
bill. The health and stability of our producers, of our rural
communities, and of America is up to us. Our Nation depends upon our
agricultural producers for a safe, affordable, and abundant food
supply. Now our producers are depending on us to provide them with a
safety net they can rely upon. The time is now. We must all dedicate
ourselves to getting back to work on the farm bill in January. We must
work together to pass a strong, stable, and comprehensive farm bill
quickly.
Mr. VOINOVICH. Mr. President, over the past 2 weeks, the Senate has
engaged in what is probably a first in the history of this body: it has
worked to complete a task before a deadline. Even as appropriations
bills remained unfinished 3 months into the fiscal year, we have, for
the past couple of weeks, debated a farm bill a full 9 months before
the current authorization lapses.
As admirable as it is to work ahead of schedule, this has been an
unnecessary exercise. There is no reason that the Senate has had to
debate the farm bill when these programs don't expire until the end of
the fiscal year.
I joined in the successful effort here in the Senate to postpone
debate on the farm bill until next year. It is my hope that we will do
a better job at writing a bill that will address the needs of our
farmers in a fiscally responsible way, rather than rushing a bill
through Congress for the sake of passing a bill.
The only reason we have debated this bill a year ahead of schedule is
because some fear that the fiscal year 2003 budget resolution won't
have enough room in it to load up whatever farm bill the Senate
considers with all the spending the majority desires.
Indeed, according to an article in the December 8th edition of
Congressional Quarterly, ``lobbyists fear that if Congress waits until
2002, when the current authorization bill expires, then the $73.5
billion in new spending for agriculture programs over the next 10 years
that was set aside by this year's budget resolution might vanish.''
Senator Kent Conrad, the Chairman of the Senate Budget Committee, who
clearly must understand our country's financial condition, has said,
``the money is in the budget now. If we do not use the money . . . it
is very likely not going to be available next year.''
That does not sound like ``need'' to me, it sounds like opportunism,
and opportunism is not sufficient reason for the majority to rush
through a bill this important and this expensive.
I agree with the analysis of Senator Lugar, the Agriculture
Committee's Ranking Member, who correctly stated on the Senate floor
last Tuesday, December 11, that, ``Proponents of the bill, S. 1731,
fastening on to a budget resolution adopted earlier this year, said we
have pinned down $172 billion over 10 years, $73.5 billion over
baseline, over the normal expenditures that have been occurring year by
year in the agriculture bills . . . I and others have pointed out that
[the money] really is not there.''
Now, I take a back seat to no one in terms of my concern for the
American farmer. When I was governor of Ohio, agribusiness was my
number one economic development initiative.
Many people, even Ohioans, don't realize that food and agribusiness
means more than $73 billion to Ohio's economy each year. In fact, one
in six Ohioans is employed in one aspect of agriculture or another.
I gave agriculture more attention and priority than any governor in
memory, and I continue my close relationship with Ohio's agribusiness
community.
Nevertheless, I could not support the majority's farm bill as
written, and honestly, I am disappointed at the apparent lack of
respect some of my colleagues seem to have for the American farmer.
Every farmer worth his salt knows that if he or she wants to stay in
business, they have to be fiscally responsible and make tough choices.
They know that the United States has to do so as well. They understand
that the majority's farm bill did not focus on proper planning and
making the right choices, but rather ``getting while the getting is
good.''
Some here in Washington think that viewpoint epitomizes the American
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farmer, but for anyone in this body to think that the American farmer
is only concerned about ``what's in it for him,'' is an insult to their
patriotism and their own understanding of fiscal responsibility.
Let me make it abundantly clear, this bill was written and has been
debated without any regard for the other obligations our nation now
faces. It is heedless of America's national security needs and it does
nothing to acknowledge the long-term fiscal responsibilities of our
Nation. Instead, the Majority's Farm Bill really just helps the
nation's agricultural conglomerates.
When Congress passed the last farm bill in 1996, it did so with the
intention that it would gradually phase out the heavy reliance on
subsidies characteristic of previous farm bills and move towards a more
market-oriented approach. That bill was named Freedom to Farm.
However, had S. 1731 passed, it would have increased federal spending
by over $70 billion over ten years, putting us back to where we were
prior to Freedom to Farm, when farmers were more dependent on the
federal government.
I remain supportive of market-based farm policies, but I believe
important improvements must be made to the current system that will
allow our farmers to adapt to a global marketplace. Unfortunately, that
same marketplace has kept U.S. prices and income low for the past three
to four years due to ever increasing world supplies coupled with low
export demand.
The cost has been outrageous, with Congress appropriating more than
$32 billion in emergency spending since Fiscal Year 1999 to offset low
prices and assist farmers who suffered losses due to natural disasters.
I have to ask: What happened to Freedom to Farm?
I have opposed these emergency measures, not only because they were
not offset, which has added to our current budget crisis, but also
because ``stop gap'' emergency measures only meet a temporary need, and
do nothing to help the long-term outlook for the American farmer.
Unfortunately, the majority, in their bill, attempted to rectify this
situation by making these emergency payments essentially permanent.
In a December 14 editorial titled ``A Piggy Farm Bill,'' the
Washington Post labeled S. 1731 ``obscene,'' and pointed out that
billions indeed have been made available in the past few years in
``emergency'' payments, however, the Post goes on to say ``the effect
of the new bill would be to regularize those [payments], thereby
abandoning the five-year experiment in supposed market reform.''
Another contention that I have with the majority's bill, is that
passage of S. 1731 as written could very well have put the U.S. in
violation of our obligations under the World Trade Organization and
weakened our demands that Europe and other countries cut subsidy
payments to their agricultural producers.
In an article that appeared in the December 18 edition of the
Financial Times, former U.S. Secretary of Agriculture Mike Espy, noting
Congress' apparent willingness to abandon a market-based approach to
agriculture, stated ``It's very awkward. Here we are involved in a
global effort to reduce subsidies, and this [bill] flies in the face of
that effort.''
Current Agriculture Secretary, Ann Veneman, said in the same article
that the legislation would ``exacerbate overproduction and perpetuate
low commodity prices,'' which would undermine our ability to expand
into new foreign markets.
That's because the majority's farm bill would put in place counter-
cyclical payments, which pay farmers a subsidy as the price of their
commodity falls. This approach most assuredly would run afoul of the
WTO treaty.
What's more, the subsidies under the majority's proposal would go to
millions of farmers and quite a few wealthy individuals and even some
Fortune 500 corporations.
Again, the Financial Times article references an organization known
as The Environmental Working Group, which has on its web-site a
compilation of more than 2.5 million farmers who receive subsidies. Of
that total, the largest farms get the most amount.
To quote the news article, ``just 1,290 farms have each received more
than $1 million in the past five years; Tyler Farms of Arkansas, which
grows cotton, rice and soybeans, led the list at more than $23 million.
In addition, 11 Fortune 500 companies, including Chevron and
International Paper, also received farm subsidies. In contrast, the
average farm in the bottom 80 percent got just $5,830.''
While I would have voted against the bill proposed by the majority,
the Cochran-Roberts Amendment that was considered on Tuesday provided a
workable alternative.
Instead of creating a counter-cyclical program, the Cochran-Roberts
Amendment would have created farm savings accounts for producers to
participate in on a voluntary basis, with matching funds provided by
the USDA. This money would help farmers make ends meet during the lean
years and would be a great improvement over the current practice of
relying on touch-and-go so-called ``emergency'' supplemental farm
spending bills.
While I am still concerned with the expense of the Cochran-Roberts
Amendment, it evenly divides its spending over the first and last five
years, and is thus more fiscally responsible than the Majority's
proposal which frontloads $45.3 billion of their $73.5 billion bill in
the first five years. Unfortunately, the Cochran-Roberts amendment was
defeated along party lines.
So we were left with the bill pushed by the majority with a price tag
we cannot afford. It will most assuredly exceed the $73.5 billion, 10-
year spending increase allowed by the fiscal year 2002 Budget
Resolution.
As we near the end of this year, we find ourselves facing challenges
that could never have been predicted a year ago. An economic slowdown
that began in the spring of 2001 has now been deemed a full-fledged
recession; a recession that was exacerbated by the events of September
11.
As Americans have responded generously to the needs of the victims
and their families, the federal government has acted quickly and
significantly as well. We've passed a $40 billion emergency
supplemental bill, as well as $5 billion in grant funding to help
prevent the collapse of the airline industry. In addition, we could
spend another $100 billion for an economic stimulus package soon after
we return from recess.
Add all that to the $25 billion that Appropriators and the White
House agreed this summer to spend over and above the fiscal year 2002
budget resolution that Congress passed, and we could spend some $170
billion over the budget resolution.
To put that in perspective, $170 billion represents 30 percent of all
the regular discretionary spending Congress enacted in fiscal year
2001.
Given this amount of spending, the Senate is poised to spend every
last tax dollar, all of the Medicare surplus and the entire $174
billion projected Social Security surplus. Even that won't be enough.
To cover all of this spending, including the spending in the
majority's farm bill if it passed, the federal government would have to
issue tens of billions of dollars in new debt this fiscal year
depending on the size of the stimulus bill, any additional defense
spending we pursue, plus the inevitable emergency supplementals
Congress will pass between now and the end of the fiscal year.
It's amazing that a few months ago, people here were worried we would
run out of debt to repay. Now, we are in a far different situation.
In fact, Treasury Secretary O'Neill sent a letter to the Majority
Leader last week requesting that the government's debt ceiling be
raised. The Secretary indicated that the current borrowing limit of
$5.95 trillion will be reached by February and that the administration
requests that the national debt ceiling be raised to $6.7 trillion.
As recently as August, the administration projected that the current
borrowing limit would not be reached until September 2003. This is
disturbing.
I am pleased we are not going forward with a farm bill that we cannot
afford at a time of fiscal crisis, and that we are not going forward
with a bill that is frankly not in the best interest of our farmers and
definitely not in the best interest of the American people. It is
unfortunate, though, that we spent two weeks debating the majority's
farm bill, when there are three
[[Page S13917]]
other pieces of legislation that I believe we should have been
considering instead.
Our number one priority should be an economic stimulus bill, or
``jobs bill'' as it should be called.
Just last week, I was part of a six-member bipartisan group of
senators who were invited to the White House by the President to
discuss the stimulus bill and the package that the Centrist Coalition
has been working on for the past seven weeks. After the meeting,
President Bush announced his support for our stimulus package; a
package that responds to the needs of those who are currently
unemployed by extending benefits and health care coverage.
It also provides rebate checks to those Americans who pay Social
Security taxes but who did not qualify for rebate checks earlier this
year. It would truly be a wonderful holiday present for the working men
and women of America as well as the nation itself since people would
receive extra cash to help pay their holiday bills, and their spending
would help spur the U.S. economy.
The bill also contains other stimulus functions, including 30 percent
depreciation bonuses to encourage investment; a reduction in the 27
percent tax rate to 25 percent; and tax incentives to encourage small
business owners to increase investment.
I won't sugarcoat the fact that it will take a lot of money to
jumpstart our $10 trillion economy, and our approach may cost up to
$100 billion. However, I believe that it is necessary to get our nation
out of the recession we're in.
That's why I am somewhat dismayed that the Majority Leader did not
bring the stimulus bill to the floor for consideration during these
past couple of weeks. Early this morning the House passed a responsible
bill based on the Centrist package which the President has agreed. It's
a compromise package that reflects much of what the Majority Leader has
said he wanted. However, that wish list seemed to shift when it became
clear that a genuine willingness to compromise existed. The American
public have expected us to pass such a bill, and I am disappointed that
we have not yet done so.
The second bill we should consider is a terrorism reinsurance bill.
This legislation would provide government backing to help cover the
costs of damages incurred in the event of an act of terrorism. Without
it, we are going to see many businesses with enormous increases in
their insurance costs. And that's for companies that can get insurance.
As a result, projects that are on the table or in the planning
process will not go forward and the economy will suffer.
There is a bipartisan proposal that is being worked on, and I can see
no reason why we should not have pushed to get this bill onto the floor
of the Senate before the end of the year.
The third bill is a comprehensive energy bill, one that will help our
economy and harmonize our energy needs with our environmental needs.
While national energy policy is being held hostage to the demands of
environmental groups, the United States must continue to rely on energy
sources in the Middle East. Surely I don't have to remind my colleagues
of the political instability that exists in this area of the world.
The most glaring example of how the lack of an energy policy is
affecting us is the fact that we currently rely on Iraq for more than
750,000 barrels of oil per day. As my colleagues know, Iraq is a hotbed
of terrorism, and I have no doubt the manufacturer of weapons of mass
destruction, run by a man who would dearly like to inflict pain upon
the United States if given the ability.
We have to put the interests of the American people in front of
politics and special interest groups. I say to my colleagues that it is
better to be able to know that we can rely upon ourselves to meet our
energy needs than to rely on Saddam Hussein. We need to stand up and do
the right thing and pass a comprehensive energy policy now, and to me,
it is incredible that the Majority Leader placed it on the back-burner
in favor of a farm bill that we can consider later this fiscal year.
Our farmers understand the need to enact these three bills because
they use energy, because they feel the pinch of a soft economy, and,
because farmers know the right thing to do.
It is my hope that we will be able to address these three issues
quickly when we return next year and that we will do a better job of
prioritizing all of the necessary work this body undertakes.
There was no compelling reason why we needed to consider the Farm
Bill one week before Christmas. In fact, with one year left on the
authorization of the Freedom to Farm Act, we will have almost all of
2002 to work on this legislation.
When we return next year, and after we take up the critical issues
like energy, stimulus and terrorism insurance, we should follow the
President's suggestion and sit down with real numbers and put together
a farm bill that is fair to America's farmers, the men and women who
really need help; fair to the American taxpayer; and fiscally
responsible. I also would encourage my colleagues to take a look at
other farm bill alternatives, such as Senator Lugar's proposal, and the
proposal put forth by Senators Cochran and Roberts. I believe they are
on the right track.
Right now, we are facing tough times that affect all Americans,
including farmers, and the Senate needs to make tough choices because
that is what our constituents have elected us to do.
The majority's farm bill, S. 1731, was the wrong bill at the wrong
time. We shouldn't have wasted precious time on flawed legislation. Our
farmers deserve a bill that has been fully vetted, following a
thoughtful and comprehensive debate. Sadly, S. 1731 offered our farmers
precious little in that regard as the majority focused more on getting
a bill done than getting the right bill done.
It is my hope that in the months ahead, we will craft a Farm Bill
that will help farmers succeed while reflecting the other pressing
fiscal needs that also face our nation. I look forward to working with
my colleagues to enact such legislation.
I ask unanimous consent that the article be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
[From the Financial Times, Dec. 18, 2001]
US Agricultural Bill Will Go Against the Grain Worldwide
proposals to increase subsidies for farmers could violate wto rules
(By Edward Allen)
There being no objection, the material was ordered to be printed in
the Record, as follows:
[From Financial Times, Dec. 18, 2001]
U.S. Agricultural Bill Will Go Against the Grain Worldwide: Proposals
To Increase Subsidies for Farmers Could Violate WTO Rules
(By Edward Alden)
Five years ago, when the US Congress last passed a major
bill to reform its farm policy, it pledged to wean farmers
from two generations of government subsidies and reintroduce
market pressures into US agriculture.
This week, the Senate is set to follow the House of
Representatives in declaring that experiment a failure.
Instead, Congress is close to approving legislation that will
increase federal subsidies to farmers by more than $70bn over
the next decade.
The sharp turnround has undermined the Bush
administration's preparations for the launch of a new round
of world trade talks that is supposed to cut sharply
government supports for agriculture. The increase in subsidy
payments to farmers could put the US in violation of World
Trade Organisation rules, and will seriously weaken the
credibility of US demands that Europe cut its farm subsidies.
``It's very awkward,'' said Mike Espy, a former secretary
of agriculture. ``Here we are involved in a global effort to
reduce subsidies, and this flies in the face of that
effort.''
Over the past decade, the US government has tried to
persuade farmers that their future lies in opening up markets
for farm products abroad.
But instead, US exports fell sharply following the 1998
Asian financial crisis and commodity prices plummeted. This
led Congress to approve billions of dollars in emergency
payments to US farmers over the past three years. ``We have
seen that export markets do not serve as a reliable safety
net in and of themselves,'' said Tom Harkin, the Iowa senator
who is the chief sponsor of the Senate bill. The new farm
bill will entrench that philosophy by institutionalising so-
called counter-cyclical payments--subsidies that rise as crop
prices fall.
Such subsidies, which have the perverse effect of
encouraging increased production when prices are falling, run
directly counter to what the US has tried to achieve in the
WTO. The Bush administration admitted earlier this year these
counter-cyclical payments fall into the so-called amber box
of
[[Page S13918]]
subsidies that must be reduced under WTO rules.
If crop prices continue to fall, automatically increasing
government payments to farmers, the US could run up against
the Dollar 19.1bn per year that is the maximum allowed under
these restrictions.
The administration and some critics in Congress have tried
to fight back.
Ann Veneman, agriculture secretary, said earlier this month
the new farm bill would ``exacerbate overproduction and
perpetuate low commodity prices'', and would compromise US
efforts to open new markets abroad. Pat Roberts, the Kansas
senator who was the chief author of the 1996 farm reform, was
blunter.
He charged last week that the powerful farmers who will
reap a windfall in new subsidies ``view the farm bill as an
ATM machine'', the American term for automatic cash
dispensers. The administration and its outmanned supporters
in Congress are hoping to delay final passage of the bill
until next year when the government will produce new budget
numbers. Those figures, which will show the federal surplus
vanishing as a result of recession, tax cuts and the war on
terror, could create pressure to curb farm spending.
The bloated farm bill legislation has indeed cast an
embarrassing new light on rural America's dependency on the
federal government.
The Environmental Working Group, a non-profit organisation,
last month posted on its website a comprehensive list of the
subsidies received by more than 2.5m American farmers.
The data, obtained under US freedom of information laws,
shows that a small number of large farmers gets the vast
majority of federal payments. Just 1,290 farms have each
received more than Dollars 1m in the past five years; Tyler
Farms of Arkansas, which grows cotton, rice and soybeans, led
the list at more than Dollars 23m.
In addition, 11 Fortune 500 companies, including Chevron
and International Paper, also received farms subsidies. In
contrast, the average farm in the bottom 80 per cent got just
Dollars 5,830.
The new bill would only increase that trend by linking
payments firmly to production, thereby rewarding the
country's largest farmers.
Other agricultural exporting countries like Australia and
many Latin American nations are dismayed by the direction of
US farm policy. Warren Truss, Australia's agriculture
minister, said during a visit to Washington last week that
the new bill would ``entrench a mentality of farm subsidies
in the US.
``It is obvious that the US which once proudly boasted it
had the most efficient farmers in the world, has now
degenerated to a situation where US farmers are dependent
upon the taxpayers for around half their income.''
The European Union, however, has been noticeably quiet on
the farm bill debate. As the world's largest provider of
agricultural subsidies--at least for the moment--the EU has
the most to gain from a bill that will do much to erase any
US claims to free market virtue.
Said one EU agricultural official: ``It has certainly taken
the heat off us.''
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