[Congressional Record (Bound Edition), Volume 146 (2000), Part 1]
[Senate]
[Pages 649-651]
[From the U.S. Government Publishing Office, www.gpo.gov]



             THE ADMINISTRATION'S FARM ASSISTANCE PROPOSAL

  Mr. GRASSLEY. Mr. President, I come to the floor this afternoon to 
discuss the recent farmer assistance package outlined in the 
President's budget proposal. It is often the case that these proposals 
are complicated and difficult to explain. But this proposal can 
actually be explained with one word. That word is ``awful.'' The 
administration's proposal is simply an awful idea.
  I am not one to usually criticize anybody who brings ideas to the 
table that in any way will assist American farmers, but in this 
instance I believe I must call it what it really is--an awful proposal. 
In fact, I am embarrassed by the administration's proposals. I can 
think of all the Democratic Senators who have been on this floor over 
the last year--the last 12 months--who have chastised Republicans for 
not doing enough to help farmers, and doing it in the right way, being 
embarrassed by the paltry sum of money the President has included and, 
more importantly, the complicated formula by which they arrive at this 
assistance.
  Just recently, we had the Vice President in Iowa stumping for 
political support in the famous Iowa caucuses. He told my fellow 
farmers he supports a ``sound, sensible farm policy.'' Those are his 
words. If this is what the administration means by ``sensible,'' they 
should have saved the effort put into this meaningless gesture and left 
it to individuals who actually know what is going on in rural Iowa and 
rural America.
  While our Nation has enjoyed one of the longest periods of economic 
growth in our history, the agricultural industry has not fared as well 
in recent years. Just last year, prices of all kinds of livestock and 
grain commodities

[[Page 650]]

were at their lowest levels since the 1970s, and the outlook for next 
year is mixed at best. According to the Food and Agricultural Policy 
Research Institute located at Iowa State University, prices for corn 
are expected to hover around $2 a bushel this year and soybean prices 
will average near $4.50 a bushel. Prices have improved somewhat from 
last year but not significantly, and obviously it is still, at these 
prices, a losing proposition; in other words, a nonprofitable situation 
for farmers.
  Last year, we in the Congress provided $8.7 billion in economic 
relief and disaster payments, simply keeping our promise we made to the 
farmers of America under the 1996 farm program of having an adequate 
safety net for farmers. We were just keeping our promise with that $8.7 
billion. That was divided into three or four different parts. The 
largest part was the Market Loss Assistance Program payments, and these 
alone were $5.5 billion.
  The administration's proposal is for $600 million compared to that 
$5.5 billion. It obviously believes that payments to farmers under the 
supplemental income assistance program will satisfy rural America's 
needs in this year of continuing low prices. The proposal definitely 
shows me and should show every farmer that the administration does not 
really care what happens to the family farmer. I could speak for hours 
about its shortcomings, but let me try to boil it down to three major 
points. Democratic Senators, speaking on the floor of this body last 
week, condemned this same proposal. I say this so people won't consider 
this a partisan shot. I associate myself with the remarks of some of 
those Senators who considered this to be a paltry and complicated 
approach to helping farmers and the Congress keep its promise to the 
American farmers made under the 1996 bill, that we would maintain a 
safety net for our farmers.
  On the administration's approach, first, it attempts to establish a 
countercyclical program. The proposal seemingly is based on a system 
that pays out when the per acre national gross revenue for a crop falls 
below a set percentage of the 5-year average of the crop's per acre 
national gross revenue. The significant shortcoming of the 
administration proposal is that a program based on national revenue 
will not capture all regional disasters.
  As an example from my own State of Iowa, everybody remembers the 500-
year flood of 1993. It was a disastrous year for the vast majority of 
my State. Experts described this 500-year flood as something that is 
never going to occur again. But production throughout the rest of the 
Nation during the time that it was ruined in Iowa was strong enough 
that, under the President's proposal, no payment would have been made 
to Iowans in need of assistance. Iowans would have been left with 
absolutely no assistance in the midst of one of the worst natural 
disasters in decades.
  I also draw awareness to the administration's belief that this grand 
plan assists small- and medium-sized producers. It does harm to these 
classes of farmers who, particularly, the other side of the aisle 
thinks we ought to have so much concern for--and we ought to have. The 
fact that their administration doesn't give concern to the small- or 
medium-sized farmer in their plan ought to be an embarrassment to my 
Democrat colleagues.
  Well, if the payment was actually triggered and the farmer wasn't 
drawing more than a $30,000 Agricultural Market Transition payment, the 
individual would be subject to the $30,000 combined payment cap. This 
means that the sum of regular AMTA payments plus the payments under the 
supplemental income assistance program could not exceed $30,000. In my 
opinion, this program actually hurts the small farmer and mortally 
wounds the medium-sized farmer. If we want to guarantee the failure of 
the medium-sized farmer in the Nation, the farmer who is big enough 
that he doesn't have time to have nonfarm income but not big enough to 
weather all the natural disasters that one can have or 3 years of low 
prices, the President's program is the best way to accomplish the 
failure of the medium-sized farmer in our Nation.
  It is simple math that brings me to this point. A farmer with a corn 
base of 600 acres would receive an AMTA payment of approximately 
$19,800 this year. But if the market crashed and he qualified for the 
maximum amount of assistance under the administration's proposal, he 
would only receive an additional $10,200. Regardless of how much money 
a farmer has lost, the most he could hope to receive is $10,200.
  In comparison, the same farmer would have received $19,000 in 
economic assistance last year due to the Market Loss Assistance payment 
Congress voted late last year. The administration's approach is $9,600 
less for that farmer than he could have received under Congress' 
approach last year. If we were to revisit historic lows this summer, 
which could trigger the SIAP-type payment that the President is 
proposing, the small- and medium-sized producers could not receive more 
than that $30,000 cap. Due to this cap, the administration's approach 
ultimately limits potential assistance to small- and medium-sized 
producers.
  Some people might think I am comparing apples and oranges when I talk 
about the two packages, but in the end, the important factor is how 
much aid are we willing to provide to the farmer. The administration 
has said that assistance wouldn't be paid to the largest producers. But 
at the end of the day, it is not just the larger growers who will be 
left out in the cold, it is going to be pretty darn cold for everyone 
in the middle and chilly for the smaller producers as well.
  This proposal reminds me of what a number of Iowa pork producers 
called the ``4-H'' payments. Remember SHOP 1 and SHOP 2 payments to the 
pork producers last year? Those payments didn't amount to much either. 
The administration billed that as a significant measure to help pork 
producers facing abysmal prices, a 60-year low in hog prices last year. 
Yet today the number of pork producers has dropped by 3,000, since we 
experienced these historic lows.
  Ultimately, the largest producers will still have $40,000 due to the 
AMTA cap, and the smaller guys will have a $30,000 cap, a $10,000 bonus 
to the larger farmer the President says he does not want to help, 
compared to what the small- and medium-sized farmer gets. Does it 
really matter what the assistance is called? Was that the 
administration's goal, of hurting the smaller and medium-sized farmers?
  My final point is this: Who is the administration really then trying 
to help? It is true that farmers with 450 acres or less in corn base 
could possibly double their AMTA payment. That is the same approach 
Congress used last year under the administration's proposal. In fact, 
this is probably a great deal for all those producers with 100 acres or 
less. But the fact is that a person who is farming 450 acres or less is 
probably, to make ends meet, also engaged in some occupation other than 
farming.
  I am not saying that most farmers don't have jobs off the farm. In 
today's economy, more and more farmers are taking jobs off the farm 
just to help pay the bills. But as I see it, the medium-sized producer, 
the producers with 500 to 1,000 acres, are almost entirely dependent 
upon the profitability of their crops. If they don't receive much-
needed assistance, they are probably going to have a hard time staying 
on the farm, and the administration's proposal does almost nothing to 
help these individuals.
  Now, as I indicated earlier, this is by no means a complete list of 
all the problems with the administration's approach, but these are a 
few of the issues that I expect Congress will have to consider. The 
fact is that if the administration really wants to help farmers, it 
will immediately announce it will block any efforts to waive the Clean 
Air Act's oxygenated requirements by the Environmental Protection 
Agency. If the President would do just this, ethanol can replace MTBE, 
which is poisoning the ground water now, and it would increase farm 
income by $1 billion per year--it would do it from the marketplace, not 
from the Federal Treasury--and create 13,000 new jobs in America in the 
process.

[[Page 651]]

  The Senate may not be able to unilaterally agree upon exactly what 
should be done to assist family farmers this year, but I think we can 
probably agree that the administration's proposal is off base and, most 
frankly, out of touch with real America. It does not accomplish the 
goals that they want to accomplish of saving the small and medium-sized 
farmers and not helping the well-off farmer.
  So I look forward to working with my constituents, various 
agricultural groups, commodity groups, and my colleagues in Congress to 
give family farmers the economic security that they deserve.
  I yield the floor.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. WELLSTONE. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. WELLSTONE. Mr. President, I thank my colleague from Wyoming for 
his graciousness. I will take 3 minutes at the most. I appreciate him 
giving me some Republican time for this.
  The PRESIDING OFFICER. Without objection, the Senator is recognized 
for 3 minutes.

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