[Congressional Record (Bound Edition), Volume 153 (2007), Part 25]
[Senate]
[Pages 34181-34205]
[From the U.S. Government Publishing Office, www.gpo.gov]




         FARM, NUTRITION, AND BIOENERGY ACT OF 2007--Continued

  Mr. REID. I ask unanimous consent we now move back to the farm bill.

[[Page 34182]]

  The PRESIDING OFFICER. The farm bill is now pending.
  The Republican leader is recognized.
  Mr. McCONNELL. Mr. President, let me join the leader indicating there 
is no reason we should not and we will pass the Energy bill today. Now 
that it is clear it is not going to be a bill to raise taxes and drive 
up the price of fuel at the pump, I think there is broad bipartisan 
support for this bill. This is the way the Senate ought to function, 
coming together behind those things that are achievable.
  The bill, with the changes the majority leader has indicated we are 
going to make, could be signed by the President and it will be 
something we could all be proud of.
  We also intend to finish the farm bill as rapidly as possible, so I 
share his goals for today, and tomorrow if need be. I think we should 
move forward with the farm bill and finish it.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, before the Senator from Nevada leaves, I 
wish to note first I was very pleased to accept your definition of our 
relationship--good friends. We are friends. I thank you for that and I 
want to say that now.
  I do want to say to you about the bill we have had a long fight 
about, and we just finished about as difficult a vote as we have had in 
a long time, that the bill you are going to send back to the House, 
this bill up here, with a few alterations and the taxes out, this bill, 
I guarantee, will get signed and it will become law. It will be the 
most significant act we can take to reduce our dependence on foreign 
oil, all by itself. It will get passed, now that we are finished with 
the hurdles, and you will be the one who will be leading it through the 
remainder of its journeys and you will be there when, indeed, it 
becomes the law of the land. It will be the most significant energy act 
we can do.
  It was done by the Committee on Commerce, led by Senator Inouye and 
Senator Stevens. Because they know how to work, they passed it when we 
could not pass it for years. Now it is ready to go. It is not dead. The 
vote caused it to stay alive and go down its way to the President for 
his signature.
  I think the Senator's accomplishments in this regard are to be 
commended. We are going to get a great bill and you will be part of it. 
I am sorry it is not exactly what you want, and you can rest assured 
there will be some of us helping you and helping the other side when it 
comes to the incentives you spoke of in your remarks. Some of us think 
they are important. We just don't think they belong on this bill and 
they do not deserve a veto.
  I thank the Senator for his kindness as we work this through. I hope 
we can make a couple of changes that Senator Inouye thinks are 
important before the bill is sent to the House.
  The PRESIDING OFFICER. The majority leader is recognized.
  Mr. REID. Mr. President, my heart is heavy, and I say that seriously, 
recognizing next year at this time Senator Domenici will be in the last 
few days of his 36-year service in the Congress of the United States. 
During 25 years of that, I have worked with him. My next year will be 
26 years. As partisan as he is and as partisan as I am, we have worked 
toward meeting the demands of the State of Nevada, heavily involved in 
the defense of this country for decades, as is the State of New Mexico. 
In the process of our working together, we have helped the country. The 
safety and reliability of our nuclear stockpile as it exists today is a 
result--and I say this in no way to boast but to be factual--of what 
Senator Inouye and Senator Domenici and I put into effect as members of 
the Energy and Water Subcommittee on Appropriations. We do not need to 
dwell on this longer than to say his dedicated service to the country 
is something I recognize, the people of New Mexico and of our country 
will recognize for many years to come.
  Mr. DOMENICI. I thank the Senator.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Illinois is recognized.
  Mr. DURBIN. Mr. President, I ask unanimous consent to speak as in 
morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DURBIN. Mr. President, this last vote was a historic vote for 
America. This was a decision about whether we were going to look to the 
future to change to an energy policy and a environmental policy 
consistent with America's best interests. Pitted in that vote were the 
oil companies, the energy companies of years gone by, and those energy 
sources for our future. The energy companies of years gone by 
prevailed.
  The irony is that the Republicans, Senator McConnell and others, have 
stood steadfast in protecting the subsidies for the oil companies of 
America. That is a time-honored tradition in the Senate. Whether you 
agree with it or not, the Senate, by and large, has been very kind to 
the oil companies and the oil industry throughout our history. We 
couldn't have seen a vote they would have been happier with than the 
last one, because in the last one, the last vote, we suggested that 
subsidies for oil companies should give way to tax incentives for new 
sources of energy, sources of energy that are clean, renewable, 
sustainable, and that vote failed by one vote.
  Isn't it ironic, at a time when oil companies in America have enjoyed 
the highest profit margins in their history, that the Republican 
argument is we must continue the tax subsidies for those oil companies? 
Isn't it ironic, at a time when Americans are paying higher and higher 
prices at the pump for gasoline, while oil companies have the highest 
profits in their histories, the Republicans argue we should not 
penalize these oil companies in any way or they will take it out on the 
consumers? It is a craven political position. It is a position which is 
devoid of leadership. It is a position which looks to the past instead 
of to the future.
  The future suggests these oil companies should be held accountable 
like every company. With $90-a-barrel oil, why in the world would they 
need a Federal subsidy? Why in the world would the Members of the 
Senate protect that subsidy when these oil companies are enjoying the 
highest profits in the history of their industry?
  I think many of us believe there is a future that is much different. 
It is a future which most Americans are praying for--when we are less 
dependent on foreign oil, when we are using energy sources that are 
kind to the environment, and where we are reducing greenhouse gas 
emissions that cause climate change and global warming. That is the 
future. The future just failed by one vote. The past was preserved with 
those who voted against this last motion.
  The oil companies now are celebrating in their boardrooms. Not only 
do they have the highest profits in history, they continue to have a 
death grip on this Senate. They continue to be able to muster enough 
votes to stop us from moving forward with the energy for America's 
future. It may be a great political victory today for the oil 
companies, but I will tell you the day is coming, and soon, when the 
American people will have a voice. In the election in 2008, they can 
decide whether to elect those political figures who are preserving the 
past, ignoring the future, or vote for those who want real change.
  I think this was a historic vote. To lose by one vote in terms of 
moving us forward, to say that President Bush--who has his own history 
in the oil industry--is going to dictate America's energy future, is to 
condemn us, I am afraid, to a future that is not hopeful. It is a 
future where this administration, having rejected Kyoto, still stands 
in lockstep with the oil industry and their view of the world. That has 
to change. That has to change if our future generations and our 
children are going to have a liveable world, one where they can cope 
with the changes in the environment and say that our generation did not 
let them down. The Senate let them down with this last vote.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Texas.
  Mr. CORNYN. Mr. President, aren't prices of gasoline high enough? Why

[[Page 34183]]

would we want to raise the price of gasoline for the American consumer 
by raising taxes and the costs of doing business on the people who 
produce oil and gasoline for the American consumer? That is exactly the 
argument I think we heard from the distinguished assistant majority 
leader: Taxes are not high enough on domestic producers of oil and 
gasoline.
  I think this vote we had was a very important vote because what we 
said is we think prices are too high and should not be any higher. We 
do not believe we ought to depend more and more on imported sources of 
oil and gas. We believe we ought to produce more domestically, here in 
the United States.
  The kind of arguments we hear from the other side of the aisle so 
often demonstrate a kind of schizophrenia when it comes to a national 
energy policy, further burdening those who produce oil and gasoline 
here domestically and then at the same time railing about the high 
prices.
  Congress can pass laws, Congress can repeal laws, but the one law 
Congress cannot repeal is the law of supply and demand. One of the ways 
we are going to find our way to a more reasonably priced gasoline at 
the pump is if we increase the supply. We know we are in a global 
competition for oil and gas. That is one of the reasons why the prices 
continue to go up, because supply is not keeping pace. One of the 
things we need to do is to take reasonable steps to open areas that are 
now out of bounds to domestic exploration for these precious natural 
resources--in an environmentally responsible way, as the modern oil and 
gas industry is capable of doing. It doesn't do any good to rail 
against big oil or to try to use any sector of the economy as a 
political football when it hurts the American consumer and the American 
people.
  I agree with the distinguished Senator from New Mexico that it was 
important that we defeat this tax increase that would raise the price 
of gasoline at the pump for the American consumer. Now we can come 
together and work on another important element of our national energy 
policy and that is conservation. We need to conserve and to use our 
natural resources more efficiently. That is what the CAFE provisions of 
this bill will do. Yes, we need to explore and put money into research 
and development of renewable fuels to try to find new and more 
efficient ways to limit our reliance on oil and gasoline.
  But in the near term, we know that is going to be part of the puzzle. 
We need to explore clean nuclear energy as a source of electricity. 
France produces more than 80 percent of its electricity using nuclear 
power; for America, it is around 20 percent. We need to get away from 
the scare tactics and using the energy companies that we are going to 
have to, in part, rely upon to find our way out of where we are and 
come up with a comprehensive energy strategy which says, yes, we need 
to tap into all sources of energy in an environmentally responsible way 
and a way that will limit carbon production and will help with the 
issue of climate change at the same time. But we are not going to do it 
by raising taxes on the domestic oil and gas industry.
  I would just point out that the competitors, for most of the people 
whom the majority wants to add taxes to, are competing with people like 
Hugo Chavez and Ahmadinejad in Iran, state-owned oil companies that 
would not be subject to this increase in taxes. So they are literally 
targeting the domestic producers in a way that will further harm our 
ability to become less dependent on imported oil and gas.
  I am proud of the vote the Senate had today. I hope we will go 
forward and come up with a commonsense, bipartisan resolution on the 
CAFE and renewable standards portion of this bill, that we will pass 
the bill and send it to the President for a quick signature. It would 
be one of the very few areas where this Congress will have actually 
done something positive here in the last year, and I think we ought to 
not give up that opportunity but take advantage of it.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Tennessee is recognized.
  Mr. ALEXANDER. Mr. President, sometimes here in the Senate we have so 
many competing views and so many different kinds of votes, some of them 
procedural, that it is hard to tell when something good happens. I wish 
to talk about such an opportunity that we have right now. This is a 
little bit like something my late friend Alex Haley used to say: ``Find 
the good and praise it.''
  We are on a path in the Congress now to do something the Senate did a 
few weeks ago, which was to take a step that our country's largest 
energy laboratory, the Oak Ridge National Laboratory, has testified 
before our committees would be the single most important step we could 
take to reduce our dependance on foreign oil. By reducing our 
dependance on foreign oil, we would do something that we could actually 
honestly say would help to lower the $3-a-gallon gasoline price over 
time, something that we could honestly say would help deal with the 
urgent issue of climate change, something that we could honestly say 
would put us on a different path toward clean energy in this country. 
And those are the new fuel efficiency standards.
  There is a clear consensus in this body--I gather in the House of 
Representatives, too--that for the first time in more than two decades, 
the Congress should say to everyone who makes cars and trucks in this 
country: You have to make cleaner cars; these cars have to use less oil 
one way or the other. We are not really saying to them, or at least I 
do not think we should say exactly how they achieve that; we are just 
saying that by the year 2020 the cars and the trucks have to average 35 
miles per gallon. This is a big step.
  As I said, the Oak Ridge Laboratory testified in the Environment and 
Public Works Committee, this is the single most important step the 
Congress can take to reduce our dependance on foreign oil. We have 
already voted to do it in the Senate, and we have already voted to do 
it in the House, and we had a vote today to strip away the taxes that 
the Senator from Texas just talked about. So we are on a path, a clear 
path to send this bill back to the House and then to the President and, 
before the first of the year, to take the most important step we can 
take to reduce our dependance on foreign oil.
  There is a lot of talk and genuine concern about climate change. 
There is not as much commonsense talk about solutions.
  On the electricity side, we know what works, and we began, in 2005 
with the Energy bill, to take those steps. That bill could have been 
called--should have been called--a clean energy bill because it started 
with aggressive steps on conservation and then it went to a renaissance 
of nuclear power.
  The inconvenient truth on solutions to climate change is that 
conservation and nuclear power are the only way we will be able to deal 
with climate change in this generation. We hope we will be able to move 
ahead to sequester the carbon from coal, but we do not have that 
technology yet in a way that it can be used in a wholesale way. We hope 
there will be solar thermal powerplants such as the one being built in 
California, and we hope photovoltaic solar panels will cost less and 
people can use them on their houses, but those renewable ways to create 
electricity only produce a very small percentage of what we need. So in 
this generation, on the electricity side, conservation and nuclear 
power, which today produces 80 percent of all of our carbon-free 
electricity, are the real ways to deal with climate change, and in our 
part of the country, in the Smoky Mountains of Tennessee, the real way 
to make the air clean.
  In the same way, on the fuel side in this country that uses about 25 
percent of all of the oil and gas, the single most important thing we 
can do is what we have already voted for once in this body, the House 
has voted for once, and if they take this bill and send it on to the 
President, the Congress will have done it; it will be fuel efficiency 
standards that say to everyone who makes and sells cars here: Your cars 
and trucks have to average 35 miles per gallon by the year 2020.

[[Page 34184]]

  So in the midst of all of the procedural votes and debating these 
genuinely held differences of opinion, I simply want to put a spotlight 
on the fact that this Congress is poised to send to the President the 
most important thing we can do to lower prices, to reduce the 
dependance on foreign oil, and to deal with the climate change. It is 
the kind of result, the kind of bipartisan result that most Americans 
would like to see happen here. They know we have our differences. We 
will be back and forth on our votes. That is what we are here for. The 
tough issues come to the Senate. That is why we are a debating society. 
But in the end, we do not come here just to state our principles; we 
come here to get principled solutions. We are on our way to one of the 
most important principled solutions we can have in terms of energy 
efficiency.
  I congratulate the Senators who have been so much involved in this. I 
hope we will pass the legislation that the Senator has promised, the 
majority leader has promised to produce here. I hope the House of 
Representatives will pass it, as well, and send it to the President. I 
hope that over Christmastime, Americans will look at this Congress and 
say: Good for you on energy independence, on climate change, on cleaner 
air, on reducing our dependance on foreign oil. You took the most 
important step you could take, and that is what we think a Congress 
ought to do.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Idaho.
  Mr. CRAIG. Mr. President, let me join with the Senator from Tennessee 
in applauding an action that ultimately now will be taken by the Senate 
and therefore by the Congress to add substantially to an energy policy 
in this country that begins us down the road in a long march toward a 
higher degree of energy independence.
  I have been in the Congress 27 years. I have always supported, up 
until this year, leaving CAFE or fleet standards for efficiency alone.
  I got here in 1980. We had just come out of the 1970s oil crisis. We 
had put policy in place that was helping transform the automobile 
industry in our country to a more efficient fleet average. But over the 
course of the last 5 years, I have seen it become increasingly 
important that we focus on every aspect of energy in our country.
  I used to be somewhat selective in what ought to be produced versus 
what ought not be, where we ought to put our incentives, where we ought 
to put our tax dollars to improve availability in the marketplace. But 
it became increasingly obvious to me that just a few miles per gallon 
per automobile in this country could make all the difference in the 
world.
  We now import $1 billion a day in oil, approximately; $360 billion of 
America's money goes overseas to foreign nations which are, at best, 
indifferent to our interests, and at worst, using the term that I call 
``petronationalism,'' use the power of their energy not only to squeeze 
us, but then they take that money and reinvest in our country or invest 
somewhere else, in many instances not in our interests.
  I have always been frustrated that a great nation such as ours could 
not move toward energy independence, could not set as a goal that by a 
certain time our country could and would become energy independent in 
all sectors if we did the following things and if we began to drive 
public policy in that direction. So this spring, Senator Byron Dorgan 
of North Dakota and I did something I had never done before: We 
introduced legislation for a mandatory 4-percent change in fleet 
efficiencies on an annual basis. Well, you would have thought the roof 
caved in.
  The automobile industry came to me wringing their hands and saying: 
We simply cannot do that. You have always been with us.
  I said: Yes, that is right. In 27 years, I have not changed, frankly, 
and in 27 years you have not changed, and it is time we do change a 
little bit.
  Now there are a lot of new efficiencies coming on out there, from 
hybrids to flex vehicles, and hopefully we are going to see a hydrogen 
fuel cell car on the market in a very short period of time that will 
begin to move its way in the market. So the automobile industry 
deserves a lot of credit for beginning to recognize the need to change 
what we use to drive America's transportation fleet.
  But the opportunity to change the industry, to cause them to move 
down that road in a discernable and a direct way because it is the 
public policy of this country, is something I decided to become a part 
of. I believe it was with the introduction of that bill, with Senator 
Dorgan and I working together, that we got those kinds of things out of 
the Commerce Committee and into the Energy bill that passed the Senate. 
And that was a strong energy bill. It had all of the right blends and 
mixes in it to begin to create a cleaner energy consumptive world for 
us and at the same time a more independent and a more efficient world.
  Today's vote was critical. We are going to send an energy bill to the 
President in relatively short order, I hope, that has a lot of those 
things in it and that causes America's transportation fleet to move in 
the right direction.
  Mr. President, $3 dollars a gallon for gas is coming out of the hip 
pockets of moms and dads in this country today, and if that pace 
continues to go up, it is going to do more to change--I think in a 
negative way--the American economy than anything we have seen. We ought 
to be all about helping the average American change that equation, and 
I think efficiencies do that. Conservation is critical as a component 
of a total energy package because that which you save you do not have 
to produce. Just a couple of miles to the gallon across America's 
transportation fleet is millions and millions of barrels of oil. That 
is what we ought to be about. It will be a cleaner fleet and a fleet 
that will produce less carbon into the atmosphere.
  All of us are concerned about greenhouse gasses and climate change, 
and efficiencies and new technologies, in my opinion, are the best 
direction to lead us to accomplish a cleaner world, and today a 
critical vote occurred that will allow us to do that.


                           Amendment No. 3666

  The PRESIDING OFFICER. The Senator from Montana.
  Mr. TESTER. Mr. President, I rise to speak on amendment No. 3666, 
which we will have a vote on at some point later in the day.
  This amendment to the farm bill addresses manipulation in the 
livestock industry. We have had consolidation in agribusiness over the 
last many decades. In the meat packer industry, for example, there are 
four major meat packers that control 80 percent of the market in the 
United States. Being big is not necessarily bad, but it can allow 
companies to manipulate and control the marketplace. We all know a 
monopolistic and controlled marketplace doesn't benefit anybody. 
Without competition, without that free market, we put our cow/calf 
producers at risk.
  The meat-packing companies have the past because of packer ownership 
manipulated forward contracting and pressure on producers to distort 
the supply and demand, maximizing their profits often at the expense of 
the cow/calf producer. The producer ends up being price taker and not 
price maker due to manipulation of the marketplace and restriction of 
the free market we all expect in the cattle industry.
  Way back in about 1921, this Government had the foresight to realize 
the free market system was a good one and that it wasn't working quite 
right, even with the antitrust laws which were deemed inadequate. So 
they passed an act called the Packers and Stockyards Act. That act has 
worked pretty well over the many decades since 1921. Unfortunately, 
court decisions recently misinterpreted the intention of the act.
  Back in 2005, a lawsuit was brought forward by a handful of livestock 
producers. This lawsuit claimed market manipulation by the meat-packing 
industry, thereby artificially lowering the price the cow/calf producer 
would get for their cattle. A jury awarded $1.28 billion in damages. 
Some time later, three judges decided to rewrite

[[Page 34185]]

the Packers and Stockyards Act instead of interpreting it. They 
overturned the decision based on a legitimate business reason.
  Amendment No. 3666 once again clarifies the Packers and Stockyards 
Act to its original intent, reintroducing competition into the 
marketplace, helping maintain a level and competitive playing field 
between widely dispersed cattle producers throughout the country and 
highly concentrated meat packers.
  I don't think there is a person in this body who doesn't think the 
free market system is a good one. Currently, what we have in the meat-
packing industry is four companies that control 80 percent of the 
marketplace. The CEOs of these four companies could go out on the golf 
course and determine how they are going to manipulate the marketplace. 
We need to make sure as a government we have protection in place for 
our family ranchers. That is what this amendment will accomplish. It 
will reinstate the Packers and Stockyards Act to its original form 
which worked so well for so many years.
  We have 170 groups in favor of this amendment. There is going to be 
some groups that oppose it. The truth is, if we want to have a vibrant 
cow/calf producer environment and economy, we need to pass the 
amendment. We need to make sure they have every market advantage they 
deserve. It is tough enough on the farm and on the ranch to make a 
living. Right now in Montana, I didn't check the weather this morning, 
but it is probably a heck of a lot colder than it is here. In some 
places in Montana, because of drought, they are out feeding cattle 
right now. They are doing an honest day's work, and they should get an 
honest day's pay. When you have monopolization in the marketplace, it 
takes away the ability to get an honest day's pay for an honest day's 
work. This amendment is going to help the folks in Montana where 
agriculture is the No. 1 industry and the No. 1 issue. If we are going 
to keep this industry vibrant, we need to pass this amendment.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Georgia.
  Mr. CHAMBLISS. Mr. President, I yield 15 minutes to the Senator from 
Kansas, Mr. Roberts.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. ROBERTS. I thank my distinguished colleague for yielding me time.
  I rise to speak in opposition to the amendment offered by my 
distinguished colleague from Montana. Despite the fact our Nation 
enjoys but apparently some do not appreciate the fact that production 
agriculture does provide the best quality food at the lowest price in 
the history of the world to feed not only America but the world's 
hungry, we have heard repeated calls for reform--and I know my 
colleague thinks his amendment falls into that category--of farm 
programs. While targeted and pertinent reform is certainly needed and 
this farm bill does take major steps forward in answering those calls, 
it seems to me we must be cautious of what lurks under the banner of 
reform. We must be mindful of the unintended consequences of our 
actions, and nowhere in this bill is that more evident than in the 
livestock title.
  I represent a State where cattle outnumber people more than two-to-
one. I have always said, usually they are in a better mood, especially 
with the weather we have been having. Cattle represented 61 percent of 
the agricultural cash receipts by generating over $6 billion in 2005; 
obviously more in 2006. I tell you this so you understand when I say 
the livestock industry is vital to Kansas and, I know, other States 
that are represented very ably in the Senate and to our national 
economy and our livelihoods. The underlying bill expands the scope of 
the Agricultural Fair Practices Act and the Packers and Stockyards Act. 
But these expansions will have major implications on the industry, and 
we must proceed with caution.
  In the livestock hearing held in April, witnesses referenced a study 
which showed alternative marketing arrangements account for only 38 
percent of the transactions in the fed cattle market. The cash market 
is responsible for 62 percent. Only 4.5 percent of transactions went 
through forward contracts and 5 percent through packer ownership. More 
importantly, this study concluded that alternative marketing agreements 
do benefit all segments of the cattle industry. It is through these 
marketing agreements that consumers are able to buy specialized 
products such as Certified Angus or Ranchers Reserve, or all-natural 
products.
  Competition issues are nothing new to this body. I agree our 
producers need to be able to compete in today's markets. I share the 
concern of the Senator from Montana in this regard. It is the role of 
the Government to protect producers from unfair practices and 
monopolies. I understand the calls from some for increased Government 
involvement. At the same time, we must take careful steps to ensure 
that in any action we might take, we do not suffer from the law of 
unintended consequences and risk the significant gains the livestock 
industry has experienced to meet our consumers' needs. Regardless of 
the Senator's intent--I don't question that--I am concerned this 
amendment does that.
  This amendment takes away a business's ability to make decisions 
freely. Let me lay out a scenario I think can be fully understood. 
Let's say you are a producer who has developed a program that produces 
a higher quality product than I, another producer, and both of us are 
trying to sell our product to the same packer. If the packer picks you, 
not me, or any other producer to fill the contract because your product 
does perform better or meets the demands of the customer, under this 
amendment, I can bring a lawsuit for that or that other producer can 
bring a lawsuit against the packer, even though they were making a 
decision based on sound business principles. The language is as clear 
as day in this amendment, ``regardless of any alleged business 
justification.'' Certainly, a packer can defend their cattle buying 
choices as a business justification.
  This amendment would allow lawsuits to be filed regardless of this 
business justification. This amendment will result in all producers 
being treated the same--sounds good--regardless of how efficient or 
inefficient their operation may be and regardless of the quality of 
product they produce.
  I know it would be easy, maybe nostalgic, maybe something we would 
want to do as we are sitting around having a cup of coffee, to return 
to the production days of 20 or 30 years ago. The market has changed 
dramatically. Production today is more efficient because of consumer 
demands. In this regard, the consumer is king. They want specialized 
products. They want all-natural beef. They want Certified Angus. They 
want U.S. premium beef or many other products that are produced under 
specified standards that meet a higher quality. Thankfully, the entire 
livestock industry, from growers to feeders to packers to retailers, 
has made great strides in recent years to meet the demands of the 
marketplace. I am concerned this amendment puts all these consumer, 
market-driven products and investment at risk. This amendment does 
discourage innovation in the industry. Our producers would receive no 
premiums for adding value to their products. Why would anyone invest 
additional resources into their production system if they were not 
allowed to receive a return on their investment? This amendment, 
combined with the language in the underlying bill, will spur lawsuit 
after lawsuit and stifle innovation. This amendment does remove choices 
from producers and from processors and consumers.
  I urge my colleagues to oppose it.
  The PRESIDING OFFICER. Who yields time?
  The Senator from Kansas.
  Mr. BROWNBACK. Mr. President, I believe my colleague had 15 minutes 
yielded to him. I ask unanimous consent to use the remainder of his 
time to speak on the amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BROWNBACK. May I inquire how much time remains?

[[Page 34186]]

  The PRESIDING OFFICER. There is 8\1/2\ minutes.
  Mr. BROWNBACK. Mr. President, I join my colleague from Kansas in 
opposition to the Tester amendment. I appreciate my colleague from 
Montana offering this amendment. I respect his background and 
knowledge. He has worked in this field. He has lived this. He is living 
it in his own operation in Montana. I have a lot of respect for that 
and for what he is targeting. I have spent all my life in the 
agricultural business. I was raised on a farm, have undergraduate 
degrees in agriculture. I was Secretary of Agriculture in Kansas. I 
have worked on these issues a long time. We have all wanted to get more 
money in agriculture and keep more family farms operating. That is 
everybody's desire. I believe that is the desire and intent of this 
amendment.
  However, in my State in Kansas, as my colleague has described, this 
is going to hurt family farm operations, and it will hurt people who 
are trying to get more money in their operation from the marketplace. I 
would like to briefly describe one example I recently experienced, an 
operation of a small family feed yard that does operate for a number of 
different individuals in the eastern part of Kansas. It is the Knight 
Feedlot. They have been operating for quite a few years in Lyons, KS. 
They have an innovative program. It is an alternative marketing 
program. They raise hormone-free, antibiotic-free cattle. They sell the 
meat directly from this feed yard into premium grocery stores in 
Connecticut and New York. It is the sort of thing many of us have been 
talking about. Let's get the producer closer to the consumer and sell 
the product they want. This is hormone-free, antibiotic-free beef. 
Anybody in this room who has raised cattle knows that if you are going 
to go hormone free and antibiotic free, you have increased your risk 
and the cost of your operation substantially to meet that consumer 
need. These guys are doing that. Any animal that gets sick, they have 
to pull out of the program because they have to keep the animal alive. 
To do it, they are going to use antibiotics, so the animal is out of 
the program when that takes place. It winnows down fairly fast. When 
you get weather fluctuations such as are taking place now, you get more 
problems and more animals out of the program.
  But eventually, because of a contractual operation they have with a 
packer--because these are feeders, they are not packers--they are able 
to get their animals identified through the system, they are able to 
get the packer to deliver that meat to the counter in Connecticut and 
New York, because my Kansas feeders are not lined up to do that, they 
have a contractual arrangement to do that, and, as a result, they are 
able to get a substantial premium for their beef.
  The consumer in Connecticut and New York can see who produces it, and 
the pictures of Kenny and Mark Knight are by the display counter on the 
beef case in these stores. They have been there, and they have been 
there to sell their beef. It works. It works for them, and they get a 
substantial premium for this beef. The consumer likes it, and they like 
seeing who has produced their beef.
  That operation would be illegal under the direction of this 
amendment. I believe this amendment would generate lawsuits against 
that very type of operation.
  I respect my colleague from Montana and his efforts to preserve the 
family farm operation--family farm operations like what my parents have 
and my brother is on. This amendment is not the way. It is 
micromanagement from here. One of the things I have certainly seen is 
you cannot micromanage America, and you should not try. The best is to 
set up fair playing rules. We have rules in this system. But we should 
not punish people who are trying to innovate to get more money for 
their producers in innovative fashions and using alternate marketing 
means and being successful at it.
  The Knights had to invest a substantial amount of money to get this 
arrangement set. They had to hire somebody to do the marketing. They 
had to hire somebody and get enough cattle to be able to enter into a 
contractual arrangement with the packer to keep these cattle identified 
and keep them identified to be able to deliver to the consumers in 
Connecticut and New York. Without that, they are not packers, they 
cannot do this. This amendment would hurt their operation. As a matter 
of fact, it would make it illegal and bring lawsuits against it.
  I urge my colleagues to vote against this amendment on a number of 
grounds: No. 1, it prohibits innovation, and No. 2, it really tries to 
micromanage something we should not try to micromanage. It is going to 
hurt my Kansas feeders.
  For all those reasons, I urge opposition to the Tester amendment.
  I yield the floor and reserve the remainder of the time, if there is 
any on our side on this.
  The PRESIDING OFFICER (Mr. Brown). Who yields time?
  Mr. CRAIG. Mr. President, may I make an inquiry?
  The PRESIDING OFFICER. The Senator from Idaho is recognized.
  Mr. CRAIG. Are there any more who wish to debate the Tester amendment 
prior to us moving to--
  Mr. TESTER. Yes.
  Mr. CRAIG. All right.
  The PRESIDING OFFICER. The Senator from Montana is recognized.
  Mr. TESTER. Mr. President, first of all, I want to thank the good 
Senators from Kansas for their comments. I, too, respect your opinion. 
I ask that you pay careful attention to what I am about to say. I am 
actually in the specialty crop business personally. It has been well 
documented, I raise organic crops. I do not raise organic beef, but I 
am around people who raise organic beef and market it freely. They will 
be able to continue to market it freely with the adoption of this 
amendment. So the folks, the Knights you talked about, in Kansas are 
still going to be able to market their hormone-free beef.
  It speaks specifically in the Packers and Stockyards Act about 
restraining commerce and creating a monopoly. They cannot have an 
alleged business justification to do that. When you are adding value to 
a product, you are increasing the value. When you are raising specialty 
crops or you are specializing in grass-fed beef or specializing in 
hormone-fed beef or antibiotic-fed beef, you still have access to those 
premium prices.
  What the Packers and Stockyards Act does is it protects the cattle 
producers and those feeders you talked about. It allows them to stay in 
business, to be able to get that premium price. What this amendment 
does is protects them from those four packers--who control 80 percent 
of the country's meat supply; and it could be fewer than that next year 
controlling 80 percent of the meat supply if they buy one another out--
it protects them from those four packers setting prices by using an 
alleged business justification to create a monopoly or restrain the 
commerce around the meatpacking industry.
  It is critically important that you know that the unintended 
consequences you talk about are not going to exist with this amendment. 
Those unintended consequences are simply not there. What this amendment 
will do is it will reinstate the free market system in our cattle 
industry.
  The point I made earlier, in my opening statement, is where you can 
literally have four CEOs of four companies that control 80 percent of 
the meatpacking industry be able to manipulate forward contracts, be 
able to manipulate the transactions within their business, and put on a 
business justification for it, and now all of a sudden it is OK under 
the Packers and Stockyards Act. That simply is not right. We ought not 
go encouraging monopolization anywhere, much less in agriculture that 
puts our producers at risk to driving them off the ranches in this 
country.
  In Montana, we have about four times as many cattle as we do people, 
I believe. It is a big issue. Premiums are still going to be there. 
Specialized beef is still going to be there. The ability to add value 
to our meat products is still going to be there for them to get the 
price they deserve for it. What

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this will stop is the meatpackers from--and I read right straight from 
the Packers and Stockyards Act--restraining commerce, creating a 
monopoly, regardless of any alleged business justification.
  Next paragraph: restraining commerce, regardless of any alleged 
business justification.
  The last time I heard, the last time I checked, if you are getting 
paid a premium, you are not restraining commerce, you are promoting 
commerce.
  And it goes on: to manipulate or control prices regardless of any 
alleged business justification.
  There are no boogeymen in these amendments, folks. This is a good 
amendment. We dealt with an amendment yesterday that talked about 
producers and the kind of pressures they are under and the mental 
health aspects that impact farmers and ranchers when they are put under 
financial pressures. I believe we adopted that amendment.
  The fact is, if you want to help farmers' and ranchers' success, 
adopt this amendment. It will make them more financially vibrant.
  With that, Mr. President, I yield the floor.
  The PRESIDING OFFICER. Who yields time?
  Mr. HARKIN. Mr. President, how much time remains?
  The PRESIDING OFFICER. The sponsor of the amendment has 19 minutes, 
and there is 17 minutes for the opposition.
  Mr. HARKIN. We have 19 minutes?
  The PRESIDING OFFICER. The sponsor has 19 minutes; the opposition has 
17 minutes.
  Mr. HARKIN. Mr. President, I ask the Senator, will he yield me 4 or 5 
minutes?
  Mr. TESTER. You bet.
  The PRESIDING OFFICER. The Senator from Iowa is recognized.
  Mr. HARKIN. Mr. President, I rise in support of the amendment offered 
by the Senator from Montana. I am a cosponsor of the amendment.
  First, I will just make an observation. In this body, out of 100 
Senators, we have 2 bona fide farmers, one on the Republican side, my 
colleague from Iowa, Senator Grassley, and one on our side, the Senator 
from Montana, Mr. Tester. These are people who actually do farm--not 
just own a farm, but they actually do farm. So when I hear them talk 
about things in agriculture, I give a lot of weight to it, not that 
they are always right, obviously. They would not claim that, I am sure. 
But you have to give some weight to their arguments, especially when 
they are making it on behalf of farmers.
  So when this amendment was first offered by the Senator from Montana, 
I began to look at it and consider it because I, too, had thought about 
the issues raised by the Senators from Kansas about whether it would be 
restrictive of a packer who wanted to provide premiums. I think he 
maybe mentioned an Angus cut or a cowboy cut, Black Angus bone-in rib 
eye, those that have premiums.
  So I was concerned. I asked my staff: Let's look at this and make 
sure we are OK on this. I think the way the amendment is drafted does, 
in fact, allow those kinds of contracts to be made because they are not 
manipulative of a marketplace.
  What the Tester amendment really goes to, I think--and I think it is 
clear in the way it is drafted--it goes to the packers who, let's say, 
might engage in collusive practices that would, in fact, depress the 
market price on a certain day or during a certain time and then claim 
they have a pro-business reason for doing so.
  I have not seen a business yet, in case after case--where they have 
colluded or where there has been some dealings--where they have not 
said, well, it is better for their business. Of course, if they can 
increase their profits, it is always better for their business, but 
increasing their profits at what expense? At the expense of a farmer 
who is relying upon the livestock market.
  So I think the amendment is one that really gets to the heart of the 
case, the Pickett case. We all know about the Pickett case. I think the 
Eleventh Circuit Court of Appeals really went riding off the range. I 
do not know where they came up with some of their thoughts on that. It 
is not the first time that the courts have gotten off course.
  The Packers and Stockyards Act was enacted to protect producers from 
packers. That was the intent, and it has been the intent ever since, to 
protect producers from packers. It was never intended to be some bill 
to ensure that packers are competitive or that they are competitive 
with other packers. That was never the intent of the Packers and 
Stockyards Act. It is to protect producers from packers to make sure 
there is as level a playing field as possible out there for the market 
to work.
  Markets: many buyers, many sellers--that is how a market works. If 
you have many buyers and one seller, no market. If you have one buyer 
and many sellers, no market. You have to have many buyers and many 
sellers for the market to work. That is what the Packers and Stockyards 
Act aims to protect.
  So, again, the amendment is not in any way intended to infringe upon 
contracts or forward contracts or the kinds of contracts that were 
mentioned in terms of giving premium prices for different kinds of meat 
produced. It was never intended--I know the Senator talked about the 
law of unintended consequences, but, again, I think the amendment is 
clear. The intent is to ensure anti-competitive practices in the 
marketplace are not allowed--are not allowed--regardless of a business 
justification.
  So, again, right now I think we have a case where the packers--I know 
a lot of them--I would like to say the ones I know are honest and above 
board, and they are. But that does not mean they all are. When it comes 
to making a profit here, maybe dealing something on the side. 
Eventually they will think they have a green light to engage in 
collusive practices to manipulate the market, and all you have to do is 
go into court and say: Business justification. What is the business 
justification? I made more money. I made more money. But at whose 
expense? At whose expense?
  That is why this amendment is so important. I think it is important 
we shine a light and at least clarify for our producers that the 
Eleventh Circuit Court's opinion on this is not the law of the land. We 
decide the law, not the Eleventh Circuit Court of Appeals.
  Mr. HARKIN. Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Georgia is recognized.
  Mr. CHAMBLISS. Mr. President, I rise today in opposition to this 
amendment.
  I, too, have great deference to those folks who till the soil and 
produce products that we all enjoy as consumers from an agricultural 
perspective. I am not a farmer, but I am a lawyer. I have read laws all 
my life. Frankly, all you have to do is read this amendment to realize 
that the amendment would prevent businesses from using legitimate 
business justifications as a defense against claims of unlawful 
practices under the Packers and Stockyards Act.
  I would simply go to the first page, section 2, where it says on page 
1232 that we are going to strike the clause regardless of any business 
justification. This clearly is a determination that should be left to 
the discretion of the U.S. courts and not summarily decided in advance 
by Congress.
  A business should be able to offer as a defense that their actions 
were done legitimately as a means of conducting business. The court has 
the option to examine this defense and gauge it against those practices 
deemed unlawful under the Packers and Stockyards Act.
  If a producer believes a packer has conspired to create a monopoly, 
he has a right to sue that packer. What if the packer's decision was 
made not as an effort to create a monopoly but as an effort to secure 
higher quality cattle from a consistent supplier? The courts simply 
must have the discretion to make this determination.
  Including language in the Packers and Stockyards Act that enumerates

[[Page 34188]]

unlawful practices and adds the phrase ``regardless of any alleged 
business justification'' is simply prejudicial against American 
businesses.
  I am sympathetic to producers who are concerned about their evolving 
role in the livestock marketplace, but this amendment is overreaching 
and will inject uncertainty into legitimate business decisions.
  Let's not attempt to stack the deck on behalf of one party over 
another. We should allow the courts all due discretion in determining 
if the actions of American businesses are justified under the Packers 
and Stockyards Act.
  I urge my colleagues to vote against this amendment.
  Mr. President, I am happy to yield to the Senator from Kansas, Mr. 
Brownback.
  Mr. BROWNBACK. Mr. President, how much time remains in opposition?
  The PRESIDING OFFICER. The opposition has 15 minutes remaining.
  Mr. BROWNBACK. Mr. President, I wish to use 5 minutes of that time.
  I respect those who do farm. My dad does, and I have a lot of respect 
for him. I have a brother who farms as well, and it is tough. It is a 
hard life.
  I went to law school, and in my background I taught agricultural law. 
I have written two books on it, if anybody is interested. I don't think 
they are still for sale because they never sold very well.
  But my point in saying that is one of the key things which is always 
talked about in agriculture is the Packers and Stockyards Act. It was 
developed back in the 1920s and 1930s because of this imbalance that 
was developing and was really heightened at that point in time even 
more so than today between the packers and producers. There were a lot 
more producers that were a lot smaller at that point in time and taken 
advantage of by packers. It was a very unscrupulous setting, and they 
passed the Packers and Stockyards Act. It was a very important piece of 
legislation, particularly in farm country, and it did have a 
substantial impact and continues to have a substantial impact today.
  The situation today is different than it was back then. What you have 
now are a number of producers that are, in many cases, of a larger 
scale and trying to get closer to the consumer. You have small 
producers as well, such as my family, who are small producers and who 
often will link up with bigger sized producers and feed yards to try to 
get more money for their cattle. Everybody is trying to get more money 
for their cattle, and that is what I want to take place: more money for 
the producer for the cattle.
  Unfortunately, because of the way this is drafted and because of 
being a lawyer and being somebody in the agricultural industry--and you 
are taking away: regardless of any alleged business justification. So 
my family says we are going to try this hormone-free, antibiotic-free 
beef, but we have to pool together at a feed yard that is big enough to 
negotiate with the packers to do this, and so they do that. We have 
1,000 head of cattle from everybody--all 20 or more people who are 
doing this--and then they are going to market it directly on forward. 
That is a business justification to pay my family more for their 
cattle. That is a business justification for them to do it.
  But we have taken it right out of here. We have said: regardless of 
any alleged business justification.
  So, now, while my family is trying to move with this packer group 
through the feed yard to get closer to the consumer to take advantage 
of this, which is a business justification, this says, no, you can't 
assume that in the Packers and Stockyards Act. So somebody on the other 
side of this, or somebody just wanting to be ornery about it says: 
Look, you can't do that. You can't do it. It is right here.
  I know the author's intent is not that intent. I also am a lawyer. 
This is something you can do under this draft of it. I appreciate the 
sentiment with which this is made. I appreciate the history of the 
Packers and Stockyards Act. It has been important. It remains important 
today. This isn't the way to get at this. This is going to cause people 
to have to go back to a generic marketplace for beef. You can say: 
Well, I am fine with a generic marketplace for beef--most people are--
but there are a lot of people who like specialty beef. That is where 
the producer gets in and gets a bigger slice of the pie is when he goes 
at the narrow marketplace for a specialty-type product and segments his 
marketplace. This, I honestly believe, is going to cut off these types 
of arrangements for farm families in my State, and I believe a lot of 
other places, to be able to get into them.
  I understand the intent. I look at it on the surface, and we could 
probably say good idea, but this is something whereby lawyers who 
practice in this field are going to see a real opportunity to shut 
something off, and I think there are plenty of people who are desirous 
of doing something like that. I would urge my colleagues to vote 
against this amendment.
  I retain the remainder of our time.
  The PRESIDING OFFICER. Who yields time?
  Mr. GRASSLEY. Would the Senator from Montana yield me some time, 
please?
  Mr. TESTER. Yes.
  Mr. GRASSLEY. Why don't you say how much I can have.
  Mr. TESTER. How much do you want?
  Mr. GRASSLEY. I would like to have 5 minutes.
  Mr. TESTER. I yield 5 minutes to the Senator from Iowa.
  The PRESIDING OFFICER. The Senator from Iowa is recognized for 5 
minutes.
  Mr. GRASSLEY. Mr. President, what the Senator from Montana is trying 
to do has to be done if we are going to have justice for the family 
farmer. We have been involved in suits regarding the packing houses for 
20 years. I remember when I first came to Congress, we were trying to 
overturn the Illinois Brick case because it stood in the way of the 
family farmer getting justice in business. So you end up fighting the 
National Manufacturers Association and the U.S. Chamber of Commerce to 
bring justice to family farmers.
  Finally, in a lawsuit down in Alabama, we get a jury who says the 
family farmer is right, but you get a judge who overrules the jury.
  Now, I want to speak about not just this particular case, because 
Senator Tester is doing that, but I hope everybody in this Senate 
remembers that on several different occasions, everybody in the food 
chain beyond the farmer's gate was lining up against the farmer. I will 
cite just a recent example in regard to food and fuel and the ethanol 
issue and corn going to $4 and the price of food going up and every 
farmer getting blamed for it. Every person in the food chain outside of 
the farmer's gate was involved in that conspiracy that had nothing to 
do with the price of food rising, but the family farmer got blamed for 
it when food went to $4--or when corn went to $4. But when the price of 
corn went down to $2.85, I didn't see the price of food go down. But 
the conspiracy exists.
  This court case and this judge and this ruling on the Packers and 
Stockyards Act is contributing to that conspiracy. We need to get 
behind it and get some justice for the family farmer.
  Now, if you want to know why there is a justification in doing what 
we are doing, all you have to do is go to a statement that a CEO of a 
major corporation made a few years ago--a little bit unrelated to this, 
but somewhat related to it--which is: Why do slaughterhouses and 
packing companies own livestock? We own livestock, the answer was, in a 
very candid way; we own livestock because when prices are high, we kill 
our own, and when prices are low, we buy from the farmer.
  What we need is a marketplace that has a great deal of transparency. 
We fight, trying to get information on sales from these packing 
companies under price discovery. We pass legislation to make price 
discovery real. Then we get regulations from the U.S. Department of 
Agriculture--we get regulations from the U.S. Department of Agriculture 
to the extent that we do not meet the goals of the legislation, and we 
don't get as much information under the regulations of the Department.
  I had a staff person who just wanted to go back to Iowa and work for 
the

[[Page 34189]]

Department of Agriculture. He is going to work for the Packers and 
Stockyards Act. I said to him: You know, you want to go there because 
you don't want to do anything, because they don't do anything to help 
the family farmer. I didn't change his mind. He is still there working, 
and I hope he is doing a good job. He knows how I feel about it. Maybe 
he will actually get something done.
  But we have to get rid of this attitude that you are going to let 
everybody beyond the farmer's gate gang up on the farmers, particularly 
when there is a court case where the jury is giving justice to the 
farmers.
  We have to pass this amendment so we get justice for the family 
farmer.
  I yield the floor.
  The PRESIDING OFFICER. Who yields time?
  Mr. CHAMBLISS. Mr. President, can I inquire as to how much time is 
remaining?
  The PRESIDING OFFICER. The supporters of the amendment have 7 minutes 
30 seconds; the opponents have 10 minutes 40 seconds.
  Mr. CHAMBLISS. I yield 5 minutes to the Senator from Kansas, Mr. 
Roberts.
  Mr. ROBERTS. Mr. President, let me say to my good friend from Iowa 
who is shaking the hand of my good friend from Montana that justice and 
conspiracy are in the eyes of the beholder. I thank him for his feeling 
for agriculture and his passion for all of agriculture and all that he 
represents. He is an outstanding champion of agriculture. However, in 
this particular case, I don't agree.
  I am going to use an example. Instead of cattle, I am going to use 
hogs. If producer A contracts with five neighboring producers to supply 
his contract with packer A, but he decides he only wants to buy from 
neighbor 1 and 2 because the others are currently having animal health 
issues, as referenced by my distinguished colleague from Kansas, the 
others are having these health issues impacting that producer A's 
performance and pricing. Neighbors 3 and 4 and 5 under this amendment 
can sue producer A because--yes, they have been injured because they 
are no longer selling hogs to producer A. So producer A's business 
defense is that animal disease issues in the barns of neighbors 3, 4, 
and 5 are producing weak performers, and he made a business decision to 
not buy from them.
  The Tester amendment simply takes away that defense. This is hogs, 
not cattle. So producer A will lose and have to pay damages and 
attorney's fees. I don't think that is the road we want to go down.
  Now, 20 years ago the beef industry lost market share. There have 
been a lot of studies as to why. Many livestock associations, State by 
State by State, knew they were losing market share while producing what 
is now defined as a generic commodity. Through innovation and 
management of genetics, premium products have been developed, and the 
consumer has responded. I mentioned the variety of products the 
consumers wish to buy and do buy. To return to this market scenario of 
20 years will be a loss to consumers, a loss to producers, and, quite 
frankly, I am going to warn, there will be a movement to increase 
imports to meet these demands. If, in fact, this packer cannot get this 
particular product for a consumer demand and we have a generic 
commodity and we will not produce that, he will go overseas. He will 
ask for beef imports. That will be one of the laws of unintended 
effects.
  I urge the defeat of the Tester amendment.
  I yield back the remainder of my time.
  The PRESIDING OFFICER. Who yields time?
  The Senator from Montana is recognized.
  Mr. TESTER. Mr. President, I thank the Senators from Kansas for their 
time. I appreciate a good discussion on the amendment. If they would 
not have come to the floor, we would not have had this good discussion. 
I also thank Senators Grassley and Harkin for cosponsoring this 
amendment. I particularly thank Senator Harkin for his comments on the 
floor, and also Senator Grassley for his comments.
  Senator Grassley and I are arguably the two folks in the Senate who 
are in production agriculture. I am very proud of that fact personally. 
I know Senator Grassley is, too. I know everybody in this body wants to 
make sure that people in production agriculture get a fair shake--not 
over and above what they deserve but a fair shake. That is what the 
farmers want and what this bill is supposed to be about.
  In this body, we all know you can only make good decisions if you 
have good information. We also know if you take just three words--and I 
will admit this is called the ``no justification amendment.'' But if 
you take those three words and set aside all of the other words around 
it, they don't mean a heck of a lot. You can interpret them to mean 
anything you want. I am not an attorney. I respect those in this body 
who are and folks around this country who are. But you need to take the 
entire bill and look at the language as it is inserted into the bill.
  If a farmer or rancher has health issues with their herd, whether it 
is pork, chickens, beef, or any other livestock they are marketing for 
food purposes, they don't have to buy it. That isn't restraining trade 
or commerce. That is not creating a monopoly. That is what those words 
revolve around--those three words--``no business justification.'' You 
have to take at least the segment before, if you are going to get an 
idea of what it says. It says the effect of restraining commerce or 
creating a monopoly ``regardless of any alleged business 
justification.''
  If you want to put the boots to the ranchers--it won't happen all the 
time, and let's hope it happens very little. In fact, if they don't put 
this amendment on the farm bill to make the Packers and Stockyards bill 
what it was when it was originally passed in 1921, you are not going to 
have a free market system. You are going to have a system where the 
four major packers can manipulate the marketplace when they feel like 
it. They may never feel like it. But if times get tough, what the heck, 
make a few extra bucks and keep the stockholders happy.
  It was talked about today that it is going to make beef or pork into 
a generic commodity. I led the charge on country-of-origin labeling in 
Montana. We passed it in 2005. I want our products to be different. I 
am all in favor of certified Angus beef and grassfed and all those 
specialized things that the consumer wants. This bill doesn't take that 
ability away. If you have sick cattle, you don't have to buy them. If 
you have Angus certified beef, you can market it that way, as long as 
it meets their criteria--certified Angus beef I am talking about, not 
stockyards.
  In fact, this is good for production agriculture. Senator Grassley 
talked about farm gate prices. If you want to hold them artificially 
low and keep putting in subsidies, these are the kinds of things you 
do. If you want to have a free market system where people get a fair 
price for a fair day's work for the product they worked so hard to get 
on the market, the family farms and ranchers--cow/calf operators, in 
this particular case--this amendment needs to be passed.
  How much time do I have?
  The PRESIDING OFFICER. The Senator has 3 minutes 10 seconds.
  Mr. TESTER. In closing, there are no unintended consequences here. 
This is straightforward. If you read the language as it goes in the 
Packers and Stockyards Act, it can be interpreted no other way other 
than if a company wants to restrain commerce or create a monopoly, 
period.
  It will stop packers from, as Senator Grassley talked about, dumping 
cattle when prices are high. It will make the market work better.
  In closing, I again thank the Senators from Kansas. I thank Senator 
Grassley and Senator Harkin. I ask this body to take this amendment for 
what it is. It is an amendment that will indeed support family farm 
cow/calf producers on the ranches of this country.
  Thank you, Mr. President.
  The PRESIDING OFFICER. Who yields time?
  The Senator from Georgia.

[[Page 34190]]


  Mr. CHAMBLISS. Mr. President, how much time do we have remaining?
  The PRESIDING OFFICER. Two minutes. The opposition has 7 minutes 40 
seconds.
  Mr. CHAMBLISS. We have a couple more speakers who are on the way. As 
soon as they arrive, we will yield time to them.
  Mr. TESTER. Mr. President, I will speak after they get done, so I 
will retain my 2 minutes.
  Mr. CHAMBLISS. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. CHAMBLISS. 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. CHAMBLISS. Mr. President, I yield 5 minutes to the Senator from 
North Carolina.
  The PRESIDING OFFICER. The Senator from North Carolina is recognized.
  Mr. BURR. Mr. President, I appreciate the generous offer from the 
ranking member.
  This is tough. Senator Tester is a friend, but he is misguided. The 
fact is that the law today has served us well in this country. I think 
it is vitally important for all Senators to realize that agriculture is 
a business that reacts and changes to market demands.
  We have put legislation into place that allows the markets to 
operate, and these laws serve as guidelines for farmers in how they 
make their business plans for the future. As a matter of fact, we are 
the envy of the rest of the world. The agricultural markets in this 
country, the hogs raised and sold and eaten, the chickens and the 
turkeys--and in North Carolina's case, we rank extremely high; we are 
No. 2 in hogs and turkey production. I daresay every person in the 
room, and even in America, has eaten pork from North Carolina at one 
point or another. One of the reasons hog farmers in my State have been 
able to grow and produce the best pork in the world is the regulatory 
forces that govern the livestock industry.
  What we are being asked to do in this amendment is to turn that on 
its head. Today, current law says if a producer wants to bring suit 
against a processor for injuries to the producer's business, they have 
to show that they have actually been injured. Let me restate that. 
Current law says if a producer wants to bring suit against a processor 
for injuries to the producer's business, they have to show they have 
actually been injured. That is a threshold that ought to be for 
everything that a suit is brought on.
  Let me put in practical terms exactly what the Tester amendment would 
do. It would say that a company that contracts with a producer, a 
grower, and because they have determined that that grower has exceeded 
the minimum standards, has done things that technologically enhanced 
the products they are going to purchase, that if they reward them by 
paying them more money because the product is better, they are now 
susceptible to a grower who may not be dealing with 10,000 hogs, he may 
be dealing with 10 hogs. He might not adapt his surroundings to the new 
technologies; therefore, the meat is not as good. But if they are not 
paid the same, he will go to court and sue that he should have been 
paid the same thing as the contract for 10,000.
  What is the net result of it? If I were in a State that had smaller 
producers who felt disadvantaged from a price, I might look at it 
differently, but what is the impact? The impact is that companies are 
not going to raise everybody's boat, they are going to lower 
everybody's boat. They are going to pay every producer less. There will 
be no incentive for new technologies to go into agriculture--
specifically hogs, turkeys, and chickens. There will be no choice for 
consumers between grades of products, some that taste better than 
others, because we will now dumb down to what this new standard is, and 
that standard will be to make sure you are not susceptible to lawsuits. 
Everybody, regardless of size, regardless of the quality of the 
product, will be paid the same.
  I will say that again. Regardless of the quality, regardless of the 
size of the purchase, because of this one little change, which is that 
you have to prove you were injured, producers will be obligated. You 
might say it is their choice; but if a choice is between being sued 
every time there are contracts that say different things, or accepting 
one standard and applying that to everybody, they are going to accept 
one standard and apply it to everybody because they cannot pass on the 
litigation costs of these foods.
  Please tell me when 1 minute is left.
  The PRESIDING OFFICER. The Senator has 30 seconds remaining.
  Mr. BURR. I hope my colleagues here understand that the law, as 
currently written, works. It has served this country well and it has 
produced choice, it has produced quality, and it has fairly reimbursed 
all who entered into it. Let's not change it, and let's make sure the 
products that America has chosen and continues to choose in the 
marketplace are driven by the marketplace, not manipulated by this body 
in Washington.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. TESTER. Mr. President, I thank the Senator from North Carolina, 
my comrade in the Russell Building. I appreciate his comments. You have 
to have good information to make a good decision. There are a couple of 
things I need to point out. First, in production agriculture, we are 
not price makers, we are price takers. When you have 80 percent 
consolidation in the meat
packing industry, you don't have much choice when they don't have this 
language in the Packers and Stockyards Act.
  If you are talking about rewarding a grower because they have less 
fat, or bigger ribeye size, or leaner beef, this doesn't stop that from 
happening. I believe there are enough attorneys in the room that if you 
read this Packers and Stockyard Act in its entirety, which is about a 
page, you will find out that the alleged business justification applies 
to when you are restraining commerce or creating a monopoly. If you 
want a free market system, which you talked about, this body needs to 
pass this amendment so there is a free market in the pork, poultry, 
beef industry. Pork, by the way, is more consolidated than beef. 
Chickens are worse yet. All I want for farmers and ranchers and the 
people in production agriculture--the cow/calf operators, in 
particular--is that they get a fair shake.
  If we pass this amendment No. 3666, you will allow those cow/calf 
operators to get a fair shake in the marketplace and be able to become 
financially viable, so this Government doesn't have to talk about 
subsidies, and they can get their paycheck from the marketplace, and it 
is a fair paycheck.
  With that, I ask the Senate to vote for this amendment. I thank my 
fellow Members for the good debate.
  The PRESIDING OFFICER. The Senator's time has expired. All time has 
expired.
  The question is on agreeing to the amendment.
  Mr. CHAMBLISS. Mr. President, have the yeas and nays been requested 
on this amendment?
  The PRESIDING OFFICER. They have not.
  Mr. CHAMBLISS. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The yeas and nays were ordered.
  Mr. BROWNBACK. Parliamentary inquiry as to whether this could be a 
voice vote so we can move on. We have a number of amendments. I inquire 
as to that issue. I will suggest the absence of a quorum to sort this 
issue through. We might be able to save the body some time. I wish to 
speak with people about it.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. HARKIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  Mr. ROBERTS. I object.

[[Page 34191]]

  The PRESIDING OFFICER. Objection is heard. The clerk will continue 
with the call of the roll.
  The legislative clerk continued with the call of the roll.
  Mr. HARKIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                      Amendment No. 3720 Withdrawn

  Mr. HARKIN. Mr. President, I ask unanimous consent that the Schumer 
amendment No. 3720 be withdrawn.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Idaho is recognized.


                           Amendment No. 3640

  Mr. CRAIG. I ask unanimous consent that the pending amendment, the 
Tester amendment, be set aside and amendment 3640 be called up.
  The PRESIDING OFFICER. Is there objection? The Senator from Iowa.
  Mr. HARKIN. Will the Senator yield?
  Mr. CRAIG. I will be happy to yield.
  Mr. HARKIN. The yeas and nays have been ordered on the Tester 
amendment. I ask unanimous consent that the vote on or in relation to 
the Tester amendment occur at a time to be determined later.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Is there objection to the unanimous consent request from the senior 
Senator from Idaho, Mr. Craig? If not, the amendment is once again 
pending. The Senator from Idaho.
  Mr. CRAIG. Mr. President, earlier on, we thought we had a 40-minute 
time agreement. We are going to start the debate on this amendment. 
Some of our colleagues want to discuss it. With that in mind, let me 
open the debate on amendment No. 3640, an amendment we think is 
critical to America's farmers and ranchers and the value of private 
property.
  Ever since the Supreme Court in 2005 decided on the Kelo decision, I 
have felt and many others have felt, including the American Farm 
Bureau, that America's farmers' and ranchers' property is now at a 
greater risk today than ever before by the issuance of eminent domain, 
or the broadening of the power of Government as it relates to that 
issue.
  I debated this amendment earlier. Several of my colleagues are on the 
floor and want to debate this amendment. Let me now turn to my 
colleague from Colorado, the senior Senator, Mr. Allard, and yield to 
him 10 minutes for the purpose of debate on this amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from Colorado is recognized.
  Mr. ALLARD. Mr. President, I thank the Senator from Idaho for his 
leadership on this particular issue. I am involved because farmers and 
ranchers all over the country are being impacted by their land values 
since the Supreme Court's ruling in Kelo.
  As was stated by the Farm Bureau, farmers and ranchers have been 
particularly vulnerable to States or local municipalities taking their 
land for private economic uses, open space or other purposes.
  Farmlands in several States have already been taken for open space 
purposes. The Farm Bureau goes on to say the amendment would strongly 
discourage the exercise of eminent domain for open space purposes.
  I have a strong record of supporting limitations on eminent domain. I 
have to rise on behalf of my farmers and ranchers in Colorado in 
support of Senator Craig's amendment. This amendment would protect 
farmland and ranchland throughout this great Nation from land 
condemnation for use as open space.
  I wish to be clear at the outset that this amendment would not affect 
uses of eminent domain that have been found to be justified. There are 
a few legitimate uses for eminent domain powers. Necessary use of 
eminent domain for items such as utility corridors or military and 
national security needs would not be affected.
  America's farmers and ranchers are some of the best land managers 
around. Not only do they manage their land in a manner making it the 
most productive in the world but also in a way that makes it some of 
the most scenic land in our country and certainly a valuable way of 
keeping open space because of the nature of their operations.
  The vistas of rural America possess some of the most remarkable 
scenery in the world. However, while their beauty is remarkable, their 
true value lies in the foods and fibers they produce.
  An unsettling trend is now unfolding in small towns and rural 
communities from coast to coast. The use of eminent domain to condemn 
working agricultural lands or lands that will be transferred from one 
private property owner to another. This is an expansive use of eminent 
domain.
  This condemnation results not only in weakening our national security 
by threatening our food supply but harms the economies of rural America 
and steals--yes, steals--private land from rightful owners.
  Senator Craig's amendment, which I support, along with Senator 
Brownback, would discourage this disturbing occurrence. It prohibits 
access to Federal financial assistance for a period of 5 years to any 
State or unit of local government choosing to exercise the use of 
eminent domain to take working agricultural ground for the purpose of 
open space.
  This reasonable and measured approach would help protect America's 
agricultural land by making governments weigh the need of taking land 
against their desire for Federal funds.
  Senators should remember the right to own property was one of the key 
principles on which this Nation was founded. I daresay that if the 
Founding Fathers were here today, they would support passage of Senator 
Craig's amendment.
  As Thomas Jefferson noted in 1775 in the Declaration on Taking Up 
Arms:

       The political institutions of America, its various soils 
     and climates, opened a certain resource to the unfortunate 
     and to the enterprising of every country and insured them the 
     acquisition and free possession of property.

  Let me say this again: ``The free possession of property'' is the 
principle the Craig amendment supports. I have a long legislative 
record of supporting the rights of the private property owner. The 
State of Colorado also has a long record of opposition to the taking of 
private property. As a Senator, I believe it is important to ensure 
that private property owners are able to retain possession of their 
land. There is a right way and a wrong way to do things. Working with 
willing sellers is the right way. Condemning working agricultural land 
for open space is the wrong way. I urge my colleagues to listen to 
their conscience and support this amendment.
  I yield the floor.
  The PRESIDING OFFICER. Who yields time? The Senator from Idaho is 
recognized.
  Mr. CRAIG. We are operating under an open time agreement. With that 
in mind, I yield 10 minutes to our agricultural counsel from the great 
State of Kansas, Senator Brownback.
  The PRESIDING OFFICER. The junior Senator from Kansas is recognized.
  Mr. BROWNBACK. Mr. President, I am the senior Senator from Kansas to 
Senator Roberts. I wanted to acknowledge that on the floor.
  Mr. CRAIG. I said ``counsel.''
  Mr. BROWNBACK. I was called the junior Senator from Kansas.
  The PRESIDING OFFICER. The Chair's mistake. I apologize.
  Mr. BROWNBACK. I thank the Presiding Officer. I appreciate that 
greatly. I always need to watch my junior Senator and make sure he is 
in his place.
  Mr. President, I note, properly, my junior Senator is the dean of the 
Kansas delegation, even if he is the junior Senator.
  I rise in support of the Craig amendment. I wish to make comments 
that I think are pertinent and germane to the farm bill because I 
believe this admendment is pertinent and germane to the farm bill. I 
know colleagues are looking at this amendment saying it is a private 
property rights issue, it belongs in the Judiciary Committee and this 
is an issue we should track through that committee. This is an

[[Page 34192]]

issue involving agricultural lands, which I think is wholly appropriate 
for the farm bill.
  Also, private property issues are so key and central to farming in 
the United States. It is in many places dominantly private property 
issues. In the West, there are a lot of public lands and agricultural 
use in public lands areas. But private rights dominates throughout the 
agricultural system of our country. There was a shock sent out with the 
Kelo case when the Court said you now don't have to have this 
justification of a public use for private property to be taken and can 
condemn it.
  Many were shocked on all sides of the aisle--right, left, middle, 
people in urban areas, people in rural areas. I wish to say 
specifically people from rural areas were particularly struck by this 
decision because they all feel an attack frequently from people in 
governmental entities to take lands for power lines, parks, land that 
should go back to them in some cases, if it is a railroad line that has 
been abandoned and the deed said the land will revert to the farmland 
owner and then it is taken for a trail. People are saying wait a 
minute, I thought we had private property rights, basic in our 
constitution, basic in our philosophy, basic to agriculture.
  This is a narrow issue to get at the Kelo decision. It is well 
crafted by the Senator from Idaho to support those private property 
rights. The amendment will deter States and local governments from 
taking working agricultural land against the will of the landowner only 
to designate that same land as open space. Here I think you can look at 
that and say, well, obviously, that is something we should protect, 
that private property right. If there is to be eminent domain, it has 
to be listed on a public purpose, like we have had eminent domain laws 
for some period of time now, and not just taking it to keep an open 
space. If that is to take place, there needs to be a different set and 
a different system rather than what is being allowed or expanded after 
Kelo by local or State units of government.
  This narrows the decision of Kelo back to what it was prior to Kelo--
a protection of private property rights. I think that is important. I 
think it is a key issue and one that is a top priority to agriculture 
and landowners. Indeed, the President of the American Farm Bureau 
Federation said after Kelo:

       No one's home or farm and ranch land is safe from 
     government seizure because of this ruling.

  Well, let's make sure their land is safe. We can do that, and this is 
an amendment that helps to do that. I think it is an important 
amendment to help to do that. If you voted in support of private 
property rights, I would hope you would support the Craig amendment, 
whichever side of the aisle you are on, and say there is an appropriate 
way and there is an inappropriate way and the appropriate way to make 
sure you have eminent domain is for a public purpose and not just 
taking agricultural lands to maintain open spaces and reducing the 
value of that land or its workability as agriculture.
  This is an important, good amendment, and I urge my colleagues to 
support it.
  I yield back to the sponsor of the bill.
  The PRESIDING OFFICER (Mrs. McCaskill). The Senator from Idaho.
  Mr. CRAIG. Madam President, it is important for my colleagues to 
understand this is a private property rights debate. For some who have 
said, well, this is in the jurisdiction of the Judiciary Committee--and 
I understand the other side is going to ask for a 60-vote threshold--
one of the reasons we are on the floor in a post-Kelo decision 
environment is because things are beginning to happen out there that 
frustrate all of us.
  My colleague from Kansas echoes the sentiment of the American Farm 
Bureau and their president, speaking out about the risk now that open 
space property, farming property, ranching property has as a result of 
Kelo. Some would say on the floor it doesn't appear to be a problem. 
Let me suggest it is.
  In Scattaway, NJ, a family protested its eviction from their 75-acre 
farm the town had seized under eminent domain for an open space 
designation. That happened in New Jersey. In Woodland, CA, in Yolo 
County, CA, the board of supervisors decided to seize a large area of 
farmland using eminent domain and declared the property open space. So 
here a government entity steps in and says: We are going to take open 
space and make it open space and we are going to use our power to do 
that--no willing seller, no willing buyer, a new shaping of eminent 
domain.
  Eminent domain, as we knew it pre-Kelo, said, public use for a 
legitimate public use, and that usually almost always fell into rights 
of way, roads, power lines, and those kinds of things where, for the 
public good, access was being denied.
  Kelo tipped that upside down.
  New Brunswick, NJ. New Brunswick moved forward to condemn, using its 
power of eminent domain, a 104-acre farm. Open space again. Telluride, 
CO. The senior Senator from Colorado was on the floor supporting our 
amendment. The town decided to use its power of eminent domain to take 
about 570 acres of an 800-acre ranch and designate the property as open 
space. Once again, the power is being used.
  That is why America's farmers and ranchers and America's agricultural 
organizations that represent them grow increasingly alarmed.
  Sussex County, NJ. The State of New Jersey used its power of eminent 
domain to take 17 acres of working agricultural property to create a 
wetlands. Open space again.
  Matthews, NC. York County, PA. York County, PA, was the one I used as 
I introduced this amendment a couple days ago, where the family fought, 
invested lots of money, and took on the county. As a result, two county 
supervisors were defeated in the election because they were going after 
private property for an open space designation, and the county said: 
Oh, no, you don't; you are out. Ultimately, the family won but at great 
expense defending their right of private property.
  That is why the American Farm Bureau has said this is a high priority 
for us.
  Madam President, Justice Sandra Day O'Connor, dissenting in Kelo v. 
the City of New London, which has tipped this eminent domain issue 
upside down, said this in her dissenting views, and it is so clear 
today the vision of this justice.

       The outfall from this decision will not be random. The 
     beneficiaries are likely to be those citizens with 
     disproportionate influence and power in the political 
     process, including large corporations and development firms. 
     As for the victims, the government now has license to 
     transfer property from those with fewer resources to those 
     with more.

  She spoke with great wisdom, particularly about the victims--those 
are the property owners--because that is exactly what is happening out 
there.
  Is open space necessary? You bet it is. Does open space have value? 
You bet it does. There is no question in an urbanizing environment, 
parks and parkland and open space is critical. Why not willing seller/
willing buyer? Why not go into the market as a city that has taxing 
power or a county that has taxing power ought to do and say, you know, 
we are going to raise a bit to go out and buy a piece of open property, 
instead of taking it? Now, yes, they compensate in eminent domain, but 
they basically establish the price. They do not have to compete.
  So Kelo tipped us upside down, because in New London, as we remember, 
the city used their right to take away private property and gave it to 
a private developer because there was someone who was holding up a 
development. They were trying to hold onto their land. This is a 
critical private property rights debate and so very necessary.
  I mentioned the family in Pennsylvania. For over 3 years, in 
Pennsylvania, that family fought their local government. How do you do 
it? You hire attorneys. Attorneys are expensive. You do the battle, you 
set up the legal case, because the county--in this instance the county 
government--wanted to take the land. As I mentioned, it didn't sit well 
with the citizens. Most citizens respect the right of private property. 
Most citizens understand that under our Constitution,

[[Page 34193]]

there is a legitimate purpose for taking, and it was called eminent 
domain when the public good and the public value was clear.
  That is the issue. It is quite simple. Now, is it a judiciary issue? 
Yes, it is. It is also an agricultural, farm bill issue. The reason I 
am on the floor with the amendment is because this taking is beginning 
to accelerate across our Nation and our Judiciary Committee has done 
nothing, to date, to reshape the Kelo decision, to protect the rights 
of the private property owner beyond the legitimate public good, and it 
is an important thing we do. That is why we are speaking out at this 
moment, and that is why it is important.
  I yield to the chairman of the Senate Ag Committee.
  Mr. HARKIN. Will the Senator yield for a question?
  Mr. CRAIG. Sure.
  Mr. HARKIN. I have read the Senator's amendment. I have sat and read 
the whole thing.
  Mr. CRAIG. It is quite simple.
  Mr. HARKIN. It is quite simple. It doesn't take a lot of time to read 
it. Then I listened to the Senator talk about the Kelo decision.
  I am not a fan of the Kelo decision either, but it seems to me the 
way the amendment is written--and I ask the Senator this--if someone, 
if a private farmer had farmland, and a private developer came in and 
got the local jurisdiction to condemn that farmland and take it for 
private development, that would be allowed under your amendment?
  Mr. CRAIG. Our amendment speaks to open space versus open space.
  Mr. HARKIN. I ask the question, though.
  Mr. CRAIG. I do not disagree with your interpretation of the current 
amendment.
  Mr. HARKIN. That is what I wanted to make clear; that the Kelo 
decision----
  Mr. CRAIG. Well, I would like to have gone further than that. The 
concern we had, and what appears to be most visible today in the new 
use of Kelo, is open space for open space. Municipalities and counties 
are stepping out--with the cases I gave, Mr. Chairman--and saying that 
for purposes of parks, we find this is a new tool. Historically, parks 
were willing seller/willing buyer, and wetlands, and now other broader 
interpretations of ``public good.''
  But Kelo, being specific and relating to private government entities 
taking property for private development, we do not speak to that. We 
think it is a broader issue that the judiciary ought to speak to.
  Mr. HARKIN. I thank the Senator for yielding and engaging in this 
colloquy. I was listening to the Senator talk about the Kelo decision, 
but the Senator's amendment doesn't reach the Kelo decision.
  Mr. CRAIG. Oh, I disagree totally.
  Mr. HARKIN. Well, if you allow----
  Mr. CRAIG. Madam President, let me respond. When the Senator says we 
don't reach the Kelo decision, we reach a portion of the Kelo decision 
that is now most frequently impacting farms and ranches, and that is 
open space for open space.
  Municipalities and counties and in one instance, as I cited, a State, 
prior to Kelo, were not using these powers of eminent domain to acquire 
open space. They were going out and buying it in the market and 
competing for it. Now they are. So Kelo, in fact, is being used for 
this purpose. That is why we are addressing this.
  Mr. HARKIN. I will have more to say about that later, but let me ask 
another question.
  Under the Senator's amendment--I wish to make sure I read it 
correctly--if a local jurisdiction--planning and zoning--decided to 
condemn some land or to take land for a park, if the amendment were 
adopted and put into law, that would mean that jurisdiction, whatever 
that jurisdiction is--it could be a county or a State--couldn't even 
get any money for education. No title I money for education. They could 
not get special education money. Let's say, money for special 
education, they wouldn't be able to get that either; is that a correct 
reading? For 5 years, they couldn't get that?
  Mr. CRAIG. If it were open and currently operating farmland and/or 
pasture land.
  Mr. HARKIN. Yes.
  Mr. CRAIG. For agricultural purposes, and they did that for open 
space purposes, there would obviously, if this were law today, be a 
great debate in that community. That community would say, you cannot 
use this power and put our educational monies at risk.
  We say, yes, Government monies, Federal Government monies. So it 
would clearly have a dampening effect. You and I both know, because we 
have been at those different levels of government, that there are 
thresholds by which a planning and zoning entity of a county or a 
municipality can and cannot operate. Would it have a chilling effect? 
Yes. It would stop them from doing that. That is the intent. Would it 
put the educational money in jeopardy? No, it wouldn't because they 
wouldn't put it in jeopardy.
  You can use scare tactics, you can create, if you will, stalking 
kinds of arguments. But you and I both know, in practicality, they are 
not going to put those other values at risk. Sewage and water money and 
all of the kinds of other things that you and I work hard to get for 
our communities--that is not going to be put at risk because what is 
going to happen is they are going to quit using the Kelo decision. They 
are going to quit using eminent domain in its broadest sense until this 
Congress gets back in the business of shaping it again. That is why we 
are doing what we are doing here.
  Mr. HARKIN. I think, then, we get to the crux of this issue. What the 
amendment of the Senator does is it has the Federal Government telling 
a local entity, a local government or a State government what it can 
and cannot do within its own jurisdiction.
  This is a very powerful Federal Government, a heavy hand coming in 
telling people that we know better than they what they should be doing.
  Mr. CRAIG. The Senator knows as well as I do that, with wetlands, 
with endangered species, you name it, the Federal Government, by law, 
by statute, by regulation, by Clean Water Act, does a lot of things. It 
is hard to deny that we do because local entities operate under those 
laws. We are simply asking local entities, in their exercise of eminent 
domain, to operate within the law. This amendment, broadly supported by 
American agriculture for fear of taking of their land, and by the 
livestock industry, and by the Public Land Council and others, says: 
No, don't do that.
  You can point out, if you will, those kinds of arguments. But they 
are hollow in the sense that we constantly do that, and we have done 
that. Local governments operate under both local jurisdiction, local 
law, State and Federal law. So I do not see that as a problem. It can 
be argued, but it is not precedent setting in any sense of the word.
  Mr. HARKIN. I say to my friend from Idaho that all of the things he 
mentioned--the Clean Water Act and all that kind of stuff--we can get 
into that, but, yes, if a local entity violates that, they are subject 
to certain sanctions, usually fines.
  Mr. CRAIG. Yes.
  Mr. HARKIN. They are not subject to losing all their Federal money 
for education, for health, for transportation, for everything else--
nothing like that. I know of no instance like that in any Federal 
legislation. If the Senator can find one for me I would appreciate it. 
I can't.
  Mr. CRAIG. I will not disagree with the Senator. I believe the taking 
of a person's wealth--and you and I in farm and ranch company know the 
assets of a farmer and rancher are tied in the land. It is their bank. 
It is their savings. It is their retirement. Some even like to pass it 
down generationally.
  To have a municipality flex a new muscle that grew out of a decision 
at the Supreme Court level because of an entity in Connecticut using it 
is ominous and needs to have powerful teeth in it to say to that local 
municipality or county: Thou shalt not, for these very narrow purposes, 
use eminent domain.
  I am saying you and I come from farm country. We know how valuable

[[Page 34194]]

that land is. It is that farmer's or that rancher's savings. It is 
their retirement, should they choose to sell it, and they can sell it 
to the city for a park if they want to. But for a county or city to 
step in and take the land when you want to hand it to your daughter or 
your son or your grandson, generationally, to pass it down through for 
agricultural purposes--there ought to be teeth, very powerful teeth. I 
think counties and cities ought not be allowed to do it, period.
  Mr. HARKIN. But it seems to me, I say to my friend, those are the 
governments that are closest to the people, rather than some distant 
government in Washington telling them what they can and cannot do. 
Plus, I say to my friend from Idaho, with all due respect, this did not 
grow out of the Kelo decision. Local governments have had the power of 
eminent domain probably going back to the founding of our Republic. I 
was trying to find out exactly when, but probably the early 1800s, 
maybe the 1700s.
  Mr. CRAIG. I have under the Constitution for ``the defined public 
good,'' and the defined public good was very clear, and we defined it 
in statute.
  Mr. HARKIN. But I say to my friend, defined public good has been 
parks and recreation areas and things like that.
  Mr. CRAIG. But they have not--excuse me. Senator?
  Mr. HARKIN. I say to my friend from Idaho I am sure he has visited 
Gettysburg. Gettysburg National Park would not be a national park were 
it not for the power of the State of Pennsylvania to have the right of 
eminent domain because that is what they used. They had to use it in 
order to get that land together for Gettysburg Park. I say to my 
friend, with all due respect, it is a national historical monument. But 
that is what they had to use to do it.
  Should Washington have been able to tell them no, you can't do that?
  Mr. CRAIG. Right in the middle of Gettysburg is a private operating 
farm today. The reason it is there is because they would not allow it 
to be condemned, and they did not meet the threshold price of a willing 
seller, willing buyer. The State of Pennsylvania, for rights-of-ways of 
road, but other than that in almost every instance in my knowledge as 
it relates to Gettysburg, bought it, acquired it, and they used Federal 
money to get it and they used the Federal Park Service and a variety of 
other tools.
  No, there is something new happening out there in a post-Kelo 
environment. You need to talk to your Farm Bureau in your State, and 
others, and your cattlemen and other farm organizations. Something new 
is happening in farmland, especially those lands adjacent to rapidly 
expanding urban environments. It is happening in a post-Kelo 
environment. That is why we are addressing it today on the Senate 
floor.
  Mr. HARKIN. I say to my friend, again, the amendment doesn't even go 
to Kelo because my friend admitted a local government could condemn, 
eminent domain, take private farmland for a private developer. Under 
his amendment they can still do that.
  Mr. CRAIG. We don't speak to that. We speak to the issue at hand 
today: taking private farmland in municipalities and urban areas, 
counties and States, for the purpose of open land, and that is a post-
Kelo phenomenon.
  Mr. HARKIN. It has been that way, as I say, going back to Gettysburg. 
They did use eminent domain in Gettysburg.
  Mr. CRAIG. They did use some, yes, I don't deny that.
  Mr. HARKIN. They carved out some sections where they didn't think 
they needed them, but they did on some other sections. So it has been 
that way forever. Kelo didn't open floodgates. What it did was open 
floodgates for private, and that I find anathema; that you could use 
eminent domain for some private purpose. But for a public purpose such 
as parks and recreation and things like that, it has been this way 
since the founding of our Republic, I say to my friend.
  My friend, I know is a conservative. It seems to me conservatives are 
always looking askance at the Federal Government coming in, 
heavyhanded, and telling local jurisdictions what they can and cannot 
do. This, it seems to me, would be the heaviest hand that I have seen 
in my years here.
  My friend is right. We, a lot of times, do pass laws, Clean Air Acts, 
things like that that he mentioned, and we impose fines if they don't 
do something. But we don't say if you violate it, we are taking away 
your education money, your health money, your transportation money, and 
everything else. I just know of no other case like that in Federal law.
  The PRESIDING OFFICER. The Senator from Idaho is recognized.
  Mr. CRAIG. Madam President, we have not yet a time limit. I have 
expressed the will and concern of those who are cosponsors of the 
amendment. I put into the record the expression of our largest national 
farm organization that sees the threat as clearly as I do, maybe less 
clear than the chairman sees it because there is a pattern rapidly 
growing out there in a post-Kelo environment--open space taken for open 
space purposes. They are taking it from the private landowner. We think 
there ought to be strong teeth here.
  With that, I retain the remainder of my time. Others are here to 
debate the issue.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. HARKIN. Madam President, I just have a few minutes. I know we 
want to get to the Brown amendment. The Senator from Ohio has been very 
patient, waiting a couple of days to get to his amendment. I appreciate 
that. I have just a couple of things I wanted to respond to.
  First, regarding the Craig amendment, I have here a letter dated 
December 11 from the National League of Cities, the National Conference 
of State Legislatures, the U.S. Conference of Mayors, and the Council 
of State Governments, all writing in opposition to the Craig amendment.
  It says--I just want to read what they said in this letter:

       This amendment is not only ill-advised, but it is also 
     unconstitutional. Amendment No. 3640 would preempt state and 
     local land use laws by prohibiting any federal funding that 
     goes to state and local governments from being used for 
     acquiring ``farmland or gracing land for the purpose of a 
     park, recreation, open space, conservation, preservation 
     view, scenic vista, or similar purpose.'' This would severely 
     chill state and local historical preservation, community 
     service, and environmental efforts.
       Under this amendment, if a state or locality were to use 
     the power of eminent domain for virtually any public purpose, 
     even if such action was completely in accordance with its own 
     statues and land use development ordinances and regulations, 
     the state or locality could lose all applicable federal 
     funding. The 5th Amendment of the U.S. Constitution expressly 
     permits the taking of private property for public use 
     provided just compensation is provided to the owner of the 
     property.
       The power of eminent domain has always been, and should 
     remain, a state and local power. The state power to use 
     eminent domain for public purposes is fundamental to a 
     state's and locality's ability to provide for the community 
     needs of its citizens, to protect unique and scenic areas of 
     a state by creating parks, and to preserve wildlife and 
     topography of a significant nature.
       Again, we urge you to reject the Craig Amendment No. 3640 
     because it preempts state and local law and thwarts valid 
     state and local efforts to preserve their natural resources 
     for the use and enjoyment of all citizens.

  I ask unanimous consent the letter representing the National League 
of Cities, the National Conference of State Legislatures, U.S. 
Conference of Mayors, and the Council of State Governments be printed 
in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                December 11, 2007.
     Hon. Tom Harkin,
     Chair, Agriculture, Nutrition and Forestry Committee, U.S. 
         Senate, Washington, DC.
       Dear Senator: On behalf of the undersigned organizations, 
     we write in strong opposition to the amendment offered by 
     Sen. Larry Craig (No. 3640) to H.R. 2419, the ``Food and 
     Energy Security Act of 2007,'' which is scheduled for floor 
     debate today. This amendment is not only ill-advised, but it 
     is also unconstitutional. Amendment No. 3640 would preempt 
     state and local land use laws by prohibiting any federal 
     funding that goes to state and local governments from being 
     used for acquiring ``farmland or gracing land for the purpose 
     of a park, recreation, open space, conservation, preservation 
     view, scenic vista, or similar purpose.'' This would severely 
     chill state and local historical preservation, community 
     service, and environmental efforts.

[[Page 34195]]

       Under this amendment, if a state or locality were to use 
     the power of eminent domain for virtually any public purpose, 
     even if such action was completely in accordance with its own 
     statues and land use development ordinances and regulations, 
     the state or locality could lose all applicable federal 
     funding. The 5th Amendment of the U.S. Constitution expressly 
     permits the taking of private property for public use 
     provided just compensation is provided to the owner of the 
     property.
       The power of eminent domain has always been, and should 
     remain, a state and local power. The state power to use 
     eminent domain for public purposes is fundamental to a 
     state's and locality's ability to provide for the community 
     needs of its citizens, to protect unique and scenic areas of 
     a state by creating parks, and to preserve wildlife and 
     topography of a significant nature.
       Again, we urge you to reject the Craig Amendment No. 3640 
     because it preempts state and local law and thwarts valid 
     state and local efforts to preserve their natural resources 
     for the use and enjoyment of all citizens.
     Don Borut,
       Executive Director, National League of Cities.
     Carl Tubbesing,
       Deputy Executive Director, National Conference of State 
     Legislatures.
     Tom Cochran,
       Executive Director, The U.S. Conference Of Mayors.
     Jim Brown,
       Washington Director, Council of State Governments.

  Mr. HARKIN. I have a letter of December 11 from a number of 
environmental and wildlife groups: National Audubon Society, Defenders 
of Wildlife, National Resources Defense Council, Sierra Club, the 
Wilderness Society, the World Wildlife Fund and others, in opposition 
to the Craig amendment.
  I ask unanimous consent that letter be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                December 11, 2007.
     Re Oppose Craig Farm Bill Amendment.

     Hon. Tom Harkin,
     Chairman, U.S. Senate Agriculture, Nutrition & Forestry 
         Committee.
     Hon. Saxby Chambliss,
     Ranking Member, U.S. Senate Agriculture, Nutrition & Forestry 
         Committee.
     Hon. Patrick Leahy,
     Chairman, U.S. Senate Judiciary Committee.
     Hon. Arlen Specter,
     Ranking Member, U.S. Senate Judiciary Committee.
       Dear Senators: On behalf of our members and supporters, we 
     strongly urge you to oppose the amendment Senator Craig (R-
     ID) has introduced to the Food and Energy Security Act of 
     2007 that would prohibit all state, local, and federal use of 
     eminent domain to take farmland or grazing land into public 
     ownership for the purposes of a park, recreation, open space, 
     conservation, preservation view, scenic vista, or similar 
     purposes. It would impose severe sanctions on any state or 
     unit of local government that uses eminent domain for these 
     purposes--a five-year loss of financial assistance and all 
     federal funds appropriated through an Act of Congress or 
     otherwise expended by the Treasury. The Craig amendment 
     arbitrarily imposes absolute bans on certain longstanding 
     uses of eminent domain for public use while totally excluding 
     others, including prisons, public utilities, roads or rights 
     of way open to the public or common carriers, pipelines, and 
     similar uses.
       Acquiring land by purchase or donation is preferable, but 
     there are times when eminent domain is necessary and 
     appropriate, both for the public uses that would always be 
     banned by the Craig amendment and those that would always be 
     allowed.
       Congress and the courts have repeatedly recognized that 
     local, state, and national parks and recreation, open space, 
     conservation, preservation view, and scenic vistas are 
     clearly valuable public uses that justify eminent domain. For 
     example, the Congressional Research Service's Annotated 
     Constitution cites laws and cases upholding eminent domain, 
     including an 1896 Supreme Court decision confirming the right 
     to condemn in order to ``promote the general welfare'' by 
     preserving an historic site (the Gettysburg Battlefield) for 
     public use and protection.
       ``E.g., Shoemaker v. United States, 147 U.S. 282 (1893) 
     (establishment of public park in District of Columbia); 
     Rindge Co. v. Los Angeles County, 262 U.S. 700 (1923) (scenic 
     highway); Brown v. United States, 263 U.S. 78 (1923) 
     (condemnation of property near town flooded by establishment 
     of reservoir in order to locate a new townsite, even though 
     there might be some surplus lots to be sold); United States 
     v. Gettysburg Electric Ry., 160 U.S. 668 (1896), and Roe v. 
     Kansas ex rel. Smith, 278 U.S. 191 (1929) (historic sites). 
     When time is deemed to be of the essence, Congress takes land 
     directly by statute, authorizing procedures by which owners 
     of appropriated land may obtain just compensation. See, e.g., 
     Pub. L. No. 90-545, Sec. 3, 82 Stat. 931 (1968), 16 U.S.C. 
     Sec. 79 (c) (taking land for creation of Redwood National 
     Park); Pub. L. No. 93-444, 88 Stat. 1304 (1974) (taking lands 
     for addition to Piscataway Park, Maryland); Pub. L. No. 100-
     647, Sec. 10002 (1988) (taking lands for addition to Manassas 
     National Battlefield Park).''
       The Craig amendment would be a draconian infringement on 
     federalism by the federal government into the traditional 
     rights of state and local governments. It would even ban uses 
     of eminent domain to clear title when no one objects.
       The Craig amendment would devastate the ability of states, 
     localities, and the Federal governments to create and protect 
     public parks, to provide for conservation of essential 
     resources and recreation, and to preserve open space. 
     Sometimes, the ability to require a property owner to sell 
     property at a fair price is needed to deal with an 
     unjustifiable ``hold out'' who seeks to stop a worthy public 
     project, or to extort a monopolist's profits from the public.
       Finally, as the Congressional Research Service explained 
     about a different proposal, there does not: ``seem to be any 
     proportionality requirement between the prohibited 
     condemnations and the length and scope of the federal funds 
     suspension. If Congress' Spending Power includes a 
     proportionality requirement for conditions on federal funds, 
     as the [Supreme] Court suggests, the absence of 
     proportionality in some of the bill's applications may raise 
     a constitutional issue.''
       For all these reasons, we urge you to oppose the Craig 
     amendment.
           Sincerely,
         Jason Jordan, Government Affairs Manager, American 
           Planning Association; William Snape, Senior Counsel, 
           Center for Biological Diversity; Brian Hires, Colorado 
           Field Coordinator, Center for Native Ecosystems; Bob 
           Dreher, Vice President for Conservation Law, Defenders 
           of Wildlife; Anna Aurilio, Director, Washington DC 
           Office, Environment America; Brian Moore, Director, 
           Budget and Appropriations, National Audubon Society; 
           Karen Wayland, Legislative Director, Natural Resources 
           Defense Council.
         Linda Lance, Vice-President for Public Policy, The 
           Wilderness Society; Doug Kendall, Executive Director, 
           Community Rights Counsel; Martin Hayden, Legislative 
           Director, Earthjustice; Sandra Schubert, JD, MA, 
           Director of Government Affairs, Environmental Working 
           Group; Julie M. Sibbing, Senior Program Manager for 
           Agriculture and Wetlands Policy, National Wildlife 
           Federation; Ed Hopkins, Director, Environmental Quality 
           Program, Sierra Club; Jessica McGlyn, Senior Program 
           Officer, World Wildlife Fund.

  Mr. HARKIN. Madam President, I think the Craig amendment, about which 
I just engaged in a colloquy with my friend from Idaho, the Craig 
amendment really is the heaviest of heavy hands I have ever seen 
proposed for the Federal Government. First, I do believe also, as I 
just stated, it does violate the fifth amendment to the Constitution. 
Also, it doesn't even get to the Kelo decision.
  As the Senator himself admitted, even under his own amendment we 
would have the oddest of all situations. It would then be permissible 
for a local entity to condemn private land for private use, but it 
would not be permissible for a local entity to condemn private land for 
public use. That is the oddest of all circumstances. Again, to say to a 
local entity that you cannot use the power of eminent domain, granted 
to you by the Constitution of the United States, for a park or 
recreation area or whatever it is, a public use for future generations 
to enjoy--to me, that is an interference in local government and local 
government decisions.
  My friend talked about, yes, somebody may want to pass farmland on to 
future generations and things like that. I am very sensitive to that. 
Yes, they should be able to. But shouldn't also a local entity or a 
State devise parks and recreation areas, also for future generations? 
There seems to be some thought if a State uses its power of eminent 
domain, they can just take the land away. The fifth amendment of the 
Constitution says, no, you have to have just compensation. That is 
where you get into courts a lot of times.
  We have seen eminent domain used for power lines, for example, to go 
across the State. Again, the amendment of the Senator, I don't know if 
it would reach the power lines.

[[Page 34196]]


  Mr. CRAIG. Will the Senator yield for that?
  Mr. HARKIN. Yes.
  Mr. CRAIG. It is important to state for the record this amendment 
touches none of the standard uses of eminent domain and historic uses, 
and I said so and all the other Senators speaking to it said so. 
Rights-of-ways--this is open space land only. It is very clear, it is 
very targeted. It does not touch any other area of historic use of 
eminent domain. OK?
  Mr. HARKIN. Madam President, well, I say to my friend, one of the 
historic uses of eminent domain has been for parks. When was Central 
Park in New York set aside? The power of eminent domain was for Central 
Park in New York. I think that has been over a hundred years.
  Mr. CRAIG. And a lot of people had their land acquired and purchased; 
eminent domain was used.
  Mr. HARKIN. I say to my friend, I do not have a catalog----
  Mr. CRAIG. I think the Record is replete now with the fact that there 
has been an acceleration of counties and cities using it post-Kelo.
  Mr. HARKIN. But my point----
  Mr. CRAIG. I know what your point is; I know we should be speaking 
through the Chair for that purpose. In my opinion, it is a broadening 
of the definition of public use in a post-Kelo environment that has put 
America's agricultural land at risk in a greater way than ever before. 
That is why this amendment is brought to the floor.
  Mr. HARKIN. I say to my friend from Idaho, that is the point I was 
trying to make, that you could still have condemnation purposes for a 
private power line. Maybe a farmer does not want that power line going 
over his land; he does not like those big cables going over his land.
  The State can come in and say: Here is your compensation.
  I do not like it.
  OK. We use power of eminent domain. We will go to court, and they 
will build that power line right across your land.
  The amendment of the Senator from Idaho would still permit that to 
happen, would still permit that to go on, still permit that to happen, 
but it would not permit a local entity to say: We have a lot of land; 
we want to preserve a park for future generations. We have some of this 
land here that is in there, and we need that for the park, and it is 
generally accepted by the public. You may have one person reticent to 
do that. So they say: OK, we use the power of eminent domain to do 
that. But that does not mean they get the land; that means they have to 
go to court to decide what is just compensation under the fifth 
amendment.
  I say to my friend from Idaho, if he really wants to pursue this, he 
ought to introduce an amendment to overturn the fifth amendment of the 
Constitution. Let's have a constitutional amendment. Who knows what it 
might be next. You think of this as a precedent. What is next? What is 
next that we might not agree with? Maybe we do not agree with speed 
limits. I say to my friend from Idaho, maybe we do not agree with what 
a State's speed limits are, so if you do not adhere to Federal 
standards on speed limits, we are going to take away all of your 
education and transportation and health money. How about education 
policy? Let's say we do not agree with the local school board. We do 
not agree with the local school board as to what its education policy 
is. It has to be what the Federal Government says, and if you do not 
adhere to it, we are going to take away your education money, your 
health money, your transportation money, and your community development 
money. We will take it away just because you do not agree with the 
Federal Government's policy on education. Zoning and other areas like 
that--think of what kind of a path we are going down if we adopt this 
amendment.
  Again, I say this amendment would again intrude the Federal 
Government into the local and State jurisdictions that have been 
preserved by the Constitution of the United States. We ought not to go 
there.
  Madam President, I hope now we are ready to turn to the Brown 
amendment. I thank the Senator for his patience.
  The PRESIDING OFFICER. The Senator from Ohio.


                           Amendment No. 3819

  Mr. BROWN. Madam President, I thank the chairman for his outstanding 
work.
  Madam President, I call up amendment 3819.
  The PRESIDING OFFICER. Is there objection to setting aside the 
current amendment? Without objection, it is so ordered. The amendment 
is pending.
  Under the previous order, there will now be 60 minutes of debate 
equally divided between the sides.
  The Senator from Ohio is recognized.
  Mr. BROWN. On behalf of Senators Sununu, McCaskill--who is 
presiding--McCain, Durbin, and Schumer, I am proud today to offer the 
Reduction of Excess Subsidies to Crop Underwriters--or the RESCU--
amendment to the farm bill.
  Our bipartisan amendment takes dollars from where they do not belong, 
from oversubsidized crop insurers, and invests them in priorities with 
a return for the United States of America, such as nutrition programs 
and conservation programs and initiatives that create sustainable 
economic development in other countries and our own, which, after all, 
is the key to strong export markets and also to deficit reduction.
  The RESCU amendment is based on a simple premise: When resources are 
limited, we simply cannot afford to waste them. We cannot afford to 
overpay crop insurers with tax dollars while underinvesting in programs 
that pay for themselves, programs that preserve farmland and deploy 
U.S. resources strategically in the global arena.
  Our amendment does not increase the cost of crop insurance for any 
farmer. I repeat: Our amendment does not increase the cost of crop 
insurance for any farmer. In fact, it has no effect on premiums at all. 
It does not, as some will claim, dramatically reduce the margin for 
crop insurers, jeopardizing access to crop insurance. It draws from 
huge, bloated overpayments and astounding profit margins, making them a 
little less huge and a little less astounding.
  Crop insurers will have no incentive to leave a business that 
continues to reward them so generously, as this Federal program does 
with these tax-dollar subsidies. They will have no incentive to leave a 
business that continues to reward them so generously for their 
involvement. I can assure you that before and after this amendment, if 
it is enacted, crop insurers will continue to be generously rewarded 
for their activities.
  This amendment simply seizes an opportunity to do some good while 
doing no harm. It is a fiscally responsible amendment that reroutes 
insurance overpayments to accomplish several beneficial goals. Some of 
the dollars go toward deficit reduction, some of the dollars honor 
faith-based missions throughout the world by contributing to a like 
program that feeds hungry children in developing countries, and some of 
the dollars help family farmers become better stewards of our land and 
our natural resources. This amendment is not glamorous or earth-
changing; it is simply an opportunity to move forward and to do the 
right thing.
  I know some of my colleagues do not want to take any money from crop 
insurers. They want to continue to shovel more taxpayer dollars to crop 
insurers. As I mentioned, some of them are worried that taking these 
dollars will put crop insurers out of business. They are not really 
worried; that is what they will say. But you just can't get there from 
here. This amendment is not going to break the backs of those insurers; 
it is just going to mean slightly less huge profits for those insurers. 
Let's face it, this amendment does not take crop insurers to the 
cleaners; this amendment takes a little drop from their rather large 
bucket.
  Federal crop insurance is an essential part of the farm safety net, 
as it should be and as it will continue to be. However, billions of 
dollars that are intended to benefit farmers are instead siphoned off 
by large crop insurance companies.

[[Page 34197]]

  Listen to this number for a moment. Since 2000, farmers received 
$10.5 billion in benefits from the Crop Insurance Program, but it has 
cost taxpayers $19 billion to provide those benefits--$10 billion in 
benefits for farmers, $19 billion in taxpayer subsidies to get that $10 
billion to the farmers. That is because the crop insurance companies 
have had such huge overpayments, huge profits during those 7 years.
  So where does the difference go? According to GAO, crop insurance 
companies take 40 cents out of every dollar that Congress appropriate 
to help farmers. Think about that, 40 cents out of every dollar. No 
place operates that way. Medicare does not operate that way, Medicaid 
does not operate that way. No other insurance company does that well.
  Look at this chart. Private property and casualty insurance profits, 
8.3 percent; Federal crop insurance profits more than double that, 17.8 
percent. So slicing a little off here, they are still going to be close 
to double the profits of other private property insurance companies, 
property and casualty insurance companies.
  In the same report, GAO found that crop insurance--this was a GAO 
report--company profits are more than double insurance industry 
averages. Again, over the past 10 years, crop insurance companies have 
almost an 18-percent return, while most of the rest of the private 
insurance market has an 8-percent return.
  This amendment also reduces the exorbitant--I mean exorbitant 
administration fees crop insurance receives. For each policy they sell, 
the GAO report shows that the per-policy subsidies to insurance 
companies will be triple what they were less than 10 years ago. This is 
the money crop insurance companies receive. A&O is administration and 
operations. So whatever the premiums are, the Government then--already 
profitable for the crop insurance company--the Government then pays 
them a percentage--roughly 20 percent, slightly more than that--in 
addition so that they can administer and operate this insurance 
program.
  Look, as prices have gone up, as the price of corn, for instance, and 
soybeans--which I have a huge growing crop, huge corn and soybean 
production in my State, one of the leading States in the country--the 
crop insurance companies make more and more money the higher the prices 
are because the premiums are then higher. If you think the price of 
corn is high, you are going to buy more insurance, the premiums are 
going to be higher, and the A&O--administration and operations--subsidy 
is 20 percent of an increasingly higher number. That is why you see 
from $497 million, to $591 million, to $700 million, to 830 million, 
to, in 2007, $1.172 billion for these administrative bonuses, if you 
will. These delivery subsidies have tripled because they are linked, as 
I said, to the total premiums and thus the rising price, particularly 
of corn and soybeans.
  This amendment will reduce the administrative subsidies for each 
policy to the national average of 2004 and 2006. This level is still 
well above every year prior to 2006. We are not taking them back to 
these numbers; we are just modestly bringing them back to this number. 
This number still was historically the highest ever. It is historically 
very generous to the crop insurance companies as a subsidy.
  This amendment, I repeat, is no threat to the crop insurance 
industry. It is a threat to something--it is a threat to complacency. 
Instead of taking the painless route and leaving the crop insurance 
industry be, we can simply apply a dose of reason and do a world of 
good. We can help feed children in impoverished nations. We can help 
restore the McGovern-Dole Program--two of the most respected Members to 
have served in this distinguished body. We can help bring down, by 
hundreds of millions of dollars, something near and dear to the heart 
of Senator Conrad, I know--we can bring down the Federal deficit.
  Simply put, we can do the right thing. I hope Members on both sides 
of the aisle will support the amendment.
  I yield the floor, and 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. CHAMBLISS. I ask unanimous consent that the order for the quorum 
call be rescinded.
  The PRESIDING OFFICER (Mr. Brown). Without objection, it is so 
ordered.
  Mr. CHAMBLISS. Mr. President, I yield to the Senator from Kansas, Mr. 
Roberts, 15 minutes, followed by Senator Grassley for up to 5 minutes.
  The PRESIDING OFFICER. Is there objection?
  Mrs. McCASKILL. Mr. President, I know the Senator from Georgia has 
yielded to the Senator from Kansas. I am supposed to be presiding now. 
The kind Senator from Ohio assumed the chair to allow me to speak on 
our amendment. I hate to hold up the Senator from Ohio who has to 
leave. If I may, I ask unanimous consent to speak for a couple of 
minutes on this amendment.
  The PRESIDING OFFICER. Is there objection?
  Mr. CHAMBLISS. Mr. President, we are fine with that.
  The PRESIDING OFFICER. The Senator from Missouri is recognized.
  Mrs. McCASKILL. I appreciate the courtesy shown by the Senator from 
Georgia and, importantly, by my friend from Kansas who, although we 
disagree about football, I know we agree about protecting taxpayers.
  Mr. President, we spend a lot of time here talking about whether we 
can afford things and trying to save money. My father was in the 
insurance business. In fact, he was commissioner of insurance in the 
State of Missouri when I was in high school and college. I have no 
problem with insurance companies making a profit. They are businesses; 
they should make profit. But we have to take a close look when it is 
taxpayer-subsidized profit. We are not talking about the normal profit 
of a private business. We are talking about taxpayer-subsidized profit. 
I don't care how you look at this insurance industry in this particular 
niche, this is a wildly profitable insurance industry right now, 
billions and billions of dollars in profit over the last several years. 
You have to ask yourself: Isn't there a way we can continue to make 
sure that crop insurance is readily available? Keep in mind this 
amendment does nothing whatsoever to cause costs to go up for the 
farmers. The premium subsidies remain the same.
  What this does is say: We can't continue with the deficits we have. 
We can't afford to do children's health insurance. The President vetoes 
that. We can't afford another $11 billion for domestic spending. The 
President threatens a veto on that. We can't afford to do anything 
except make sure we subsidize a very profitable insurance industry.
  We have to stop some of the ability of this particular niche 
industry. They don't even have to worry about antitrust laws because we 
have written that into the law for them.
  This is a modest attempt. If our amendment had been in place in 2006, 
the companies still would have received $797 million in underwriting 
gains alone in comparison to the $885 million they actually received. 
We are not talking about putting anybody out of business. We are 
talking about doing what is right in terms of watching taxpayer 
dollars.
  This is about priorities. I want the billions in subsidized profits 
to go where the needs are. There are many in this farm bill. That is 
where they are directed. There is also a great attempt to do something 
about these mind-numbing, jaw-dropping deficits. It seems a lot of our 
friends on the other side of the aisle don't want to pay for anything. 
They don't want to pay for AMT. They don't want to pay for anything in 
the Energy bill. If we keep going down this road, we should do away 
with an attempt to pay for anything and just print money, see how that 
works.
  It is time we do the right thing on this particular taxpayer-
subsidized profit and find a middle ground where we can continue to 
make sure crop insurance is available and affordable,

[[Page 34198]]

which this amendment will do, but allow some of the taxpayer money to 
go to more urgent needs than major profits in this industry.
  I thank my colleagues for their courtesy.
  The PRESIDING OFFICER (Mrs. McCaskill). Who yields time?
  Mr. CHAMBLISS. Madam President, I yield 15 minutes to the Senator 
from Kansas.
  The PRESIDING OFFICER. The Senator from Kansas is recognized.
  Mr. ROBERTS. I thank the Presiding Officer and my friend from 
Georgia. I see the Senator from Missouri is the Presiding Officer. I 
wish her well in the Cotton Bowl against Arkansas, as we in Kansas go 
to the Orange Bowl. I hope she wishes us well.
  Despite what has been said, I am rising in strong opposition to the 
Brown amendment which I think, bluntly put--and I will say it the way I 
think it is--would kill the crop insurance program, especially in 
certain sections of the country and, as a result, endanger a great many 
farmers. I have often said it is more important to prevent the passage 
of bad legislation--counterproductive legislation, if you will--than it 
is to add more legislation to the books, regardless of the argument. 
This amendment certainly falls into that category.
  I am always amazed at the number of people who criticize a program 
that benefits our farmers and ranchers, some of whom do their speaking 
with their mouths full. It is truly a paradox of enormous irony: Those 
who enjoy the safest, most affordable food supply in the world, 
compliments of America's farmers and ranchers, with good intentions or 
not, do great harm to the very programs that support our producers in 
providing the bounty that is the modern miracle of American 
agriculture. It is time to stop. I understand the support for the 
programs that this amendment alleges by cutting crop insurance or using 
crop insurance as a bank. Let me go over those programs.
  Other than the Conservation Reserve Program, the Environmental 
Quality Incentives Program is the most popular conservation program in 
Kansas. Obviously, I am for that program. Obviously, I am for 
reasonable funding for that program. I have been one of the strongest 
supporters in the Senate of the McGovern-Dole, or what we call in 
Kansas the Dole-McGovern, international school lunch program. In fact, 
I was the Senator who led efforts to get all 100 Senators serving at 
the time to sign a letter urging them to keep the program under the 
jurisdiction of the Department of Agriculture. I was the House 
Agriculture Committee chairman who saved the Food Stamp Program when 
many wanted to block grant it. The Governors wanted the money, but they 
didn't want to operate the Food Stamp Program. So I have a little blood 
pressure, if you will, and heartburn when folks try to tell me my 
producers don't understand or care about these programs. Just the 
opposite is true. I take offense at saying the funding for these 
programs should be increased on the backs of our farmers and ranchers 
which will happen if this amendment passes.
  I get frustrated when we get amendments that will inflict great harm 
for the simple fact that some--good intentions aside; I don't question 
that at all--do not truly understand how a program works, and they 
don't want to take the time to get their facts straight. We have 
already increased nutritional spending by $5.5 billion in this bill. We 
have increased conservation spending by, as the ranking member knows 
and as anybody who represents farmers and ranchers knows, $4 billion, 
all the while cutting $6 billion from traditional commodity programs, 
including $4.7 billion from crop insurance. Haven't we already 
extracted our pound of assistance and flesh from our farmers and 
ranchers? Note that I say the crop insurance program directly affects 
the wherewithal of farmers and ranchers. It is inseparable.
  I will tell my colleagues why I think the authors of this amendment 
have their facts wrong, but first I want to make it clear what will 
happen if this amendment passes. This amendment does propose to 
increase the amount of quota share that companies must cede to the 
Government from 5 percent to no less than 15 percent. It could go 
higher, a lot higher. Quota share, pardon the vocabulary of agriculture 
program policy, is the percentage of underwriting earnings that a crop 
insurance company must cede back to the Federal Government. Currently 
that is 5 percent of earnings. Put another way, it is an additional 5-
percent tax companies must pay to the Government prior to expenses 
being figured. In addition, if this amendment had been in place for the 
2007 crop year, it would have also reduced the administrative and 
operating expense reimbursement to the companies by an additional 30 
percent beyond what is already in the committee-passed bill. If we do 
the proposed changes in underwriting gains in this program, we will be 
ceding additional reinsurance risk from the private market, and it will 
go to the risk management agency of the USDA--that is the outfit that 
runs the crop insurance program--and the U.S. taxpayer. I don't think 
we want to do that.
  Additionally, we will make it more expensive for companies to service 
the program and provide it to producers, so much more expensive and 
risky that it may well cause some companies to pull out of higher risk 
or underserved States. That is the big issue. You might want to reform 
it in ways that will not affect your home State where basically you get 
a lot of rain but don't have a lot of risk and you don't farm--the seed 
just comes up--as opposed to high-risk areas. That means we may have 
States where crop insurance would not be available or, at the very 
least, there may be fewer options available from which producers can 
purchase crop insurance. If producers can't get crop insurance, it 
means they will be back here asking for ad hoc disaster aid. For 
everybody who votes for this amendment, if it passes, I want you to 
help me to come back here in regard to ad hoc disaster aid. Kansas is 
now frozen over with yet another blizzard.
  Even if we have a permanent disaster package in this bill, which we 
do, it also means we would be making it harder for many farmers, 
especially young ones, to get the operating loans and financing they 
need for their operation. Why would it be harder for them to get 
financing? It will be harder because most lenders and a good number of 
landlords require crop insurance as part of their business agreement. 
So if you take away crop insurance, you hit those young farmers who 
don't have a lot of equity built up in their operations.
  On the other hand, I am sure there are those who say: Well, look at 
the GAO study on crop insurance. It is important to go over why this is 
a completely flawed study. Personally, if you presented it in the 
private business world, I think your job might be in danger. First, it 
takes into account none of the increases in the participation in the 
program that have occurred since the passage of the Agriculture Risk 
Protection Act of 2000, reforms to the crop insurance program that I 
helped lead in this body, along with our great former Senator Bob 
Kerrey. We worked hard, and it took us 18 months. We reformed the 
program. Those efforts have led to increased participation, not only in 
the plains States but all throughout the country, more especially in 
the South and for specialty crops and everybody involved in 
agriculture. As I said, especially in the southern region, represented 
by our outstanding ranking member, Saxby Chambliss, but also in regions 
that grow specialty crops or that have been considered underserved by 
the program in the past. We fixed that. This increased participation 
increases the ability to make profits for the companies, but it has 
also led to a significant increase in the amount of risk they are 
insuring in this program.
  First, the study was ordered in the House--I am talking about the GAO 
study--by those who, shall we say, have been less than friendly to the 
crop insurance program and to our farmers and ranchers. That is 
probably the understatement of my remarks. Second, the GAO study, I 
believe, is counterproductive because everyone here knows you can get a 
GAO study to say

[[Page 34199]]

whatever you want. I have been committee chairman three times. You ask 
the questions right, they respond with the answers you want. This GAO 
study claims that crop insurance companies are making huge amounts of 
money--we just heard that from previous speakers--and are much more 
successful than traditional property and casualty insurance companies. 
The first flaw in this study is that they pretty much compared apples 
and oranges. When looking at the business relationships between crop 
insurance and traditional property and casualty companies, they 
compared a 5-year period for the crop insurance program that 
represented what happens to be 5 of the lowest crop loss years 
nationally in the history of the program. At the same time they 
included a time period for looking at the business numbers of the 
property and casualty industry that included both the 9/11 attacks and 
Katrina--in other words, one of the worst 5-year business periods in 
the history of the traditional property and casualty business. If you 
take a comparison that shows one of the best 5-year periods in history 
in terms of insured losses for one sector of the industry and you take 
one of the worst 5-year periods for another sector of the industry, 
what do you think the numbers are going to look like?
  Additionally, this GAO report claims that the companies are making 
substantial underwriting gains on the premiums they collect which the 
GAO then assumes is all complete profit. That is one of the arguments 
that has just been made. Yes, companies do make underwriting gains on a 
portion of their premium that is collected, if there are not losses. 
That is the factor that has not been brought up. What the GAO fails to 
mention is that were a major loss to occur this year--i.e., the 1988 
drought, what we have been through in Kansas, or the 1993 flood--the 
companies would also be responsible for these underwriting losses.
  In addition, the GAO report makes the assumption that any 
underwriting gains by the companies are pure profit. This is 
ridiculous. There are expenses that are paid out of those underwriting 
gains. The largest of these expenses is for costs to pay private 
reinsurance companies for the amount of risk they underwrite for the 
insurance companies.
  Let me explain this in plain English. It is called ``show me'' in 
Missouri. All lines of insurance, as the Presiding Officer knows, 
protect their investments by insuring their own risk with private 
reinsurers. That is the way it is done. Crop insurance companies do the 
same thing. If they did not do it, again, the risk management agency of 
the USDA and U.S. taxpayers would have to act as the reinsurers for the 
program, thus greatly increasing the risk for additional cost for 
taxpayers. We don't want to go down that road. So if you subtract this 
and other expenses to obtain net underwriting gains, which the GAO did 
not do, the numbers look a heck of a lot different.
  In addition, the private reinsurance industry has serious concerns 
with the proposed increase in quota share from 5 percent to a minimum 
of 15 percent that, again, must be ceded back to the Federal 
Government. Again, in simple terms, this requirement will force 
companies to cede an additional minimum of 10 percent of underwriting 
gains-- prior to expenses even being calculated--back to the Federal 
Government.
  Now, the authors of this amendment and the USDA call it a quota 
share. I simply call it a tax because that is what it is when you force 
any company to provide an additional 10 percent or more of their 
earnings to the Federal Government.
  Private reinsurers know the crop insurance business can be very 
risky. Yes, you can have several profitable years if you do not have 
widespread weather problems. But if you have a major crop loss across a 
broad area of the Nation--and I can tell you that has happened again 
and again and again.
  I see Senator Conrad over there on the other side of the aisle. 
Senator Conrad, for Lord knows how many years, had to undergo all sorts 
of bad weather, all sorts of weather-related tragedies. He had the 
famous chart of the famous cow named Bossy, that was, unfortunately, 
legs up and had undergone a rather tragic experience. I kept saying to 
the Senator: My Lord, I cannot understand this. You have had floods, 
you have had blizzards, you have had drought. I even told him one time: 
You ought to move.
  That is not an answer.
  If you have a major crop loss across a broad area of the Nation--more 
especially in high-risk Plains States, where we do produce, by the way, 
in Kansas 350 million bushels of wheat every year or 400 million; that 
is the other side of the thing in regards to what we actually 
contribute to the country--why then, if you are in the crop insurance 
business, you could have a substantial loss in the program, and some 
have.
  Now, reinsurers worry that the increased quota share, or the tax, 
will make it harder for companies to meet the expense of this insurance 
and will make them more susceptible to losses. Thus, some reinsurers 
may pull out of doing business with the crop insurers.
  If private reinsurers pull out of crop insurance, then under the 
terms of the Standard Reinsurance Agreement between the companies and 
RMA, additional risk will be shifted to the U.S. taxpayer. It is as 
simple as that.
  In addition to the quota share, the reduced administrative and 
operating expense reimbursement--yet another reduction--will increase 
company costs. The average A&O reimbursement--again, the administrative 
and operating expense is currently 20 percent. We have several studies 
that have indicated the actual cost for the companies of administering 
the program is around 26.5 percent.
  The PRESIDING OFFICER (Ms. Klobuchar). The Senator's time has 
expired.
  Mr. ROBERTS. Madam President, I ask for 3 additional minutes.
  The PRESIDING OFFICER. Is there objection?
  Mr. CHAMBLISS. Madam President, could we have unanimous consent that 
we get 3 additional minutes on both sides?
  Mr. CONRAD. Madam President, there would be no objection on our side.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. CHAMBLISS. The Senator shall have 3 additional minutes.
  Mr. ROBERTS. I thank the Senator.
  Yet this amendment proposes taking that reimbursement down even 
further.
  These companies are businesses. Like any good business, if you make 
the risk too high or increase the costs too much, you will leave the 
business. Now please listen to this: There are only 16 companies now 
participating in the crop insurance program today--16. When I first had 
the privilege of serving in the House of Representatives and serving on 
the Agriculture Committee, 20 years ago, the number was 60. It went 
from 60 to 16. If this amendment is adopted, I do not know where it is 
going. Some companies will not serve certain sections of the country.
  Perhaps it is not as profitable as some might claim? If this 
amendment is adopted, there may well be entire regions of the country 
where companies will simply no longer provide this service.
  If you add additional costs, I think there is a very real risk that 
the companies will either leave the business completely or at the very 
least begin to pull out of higher risk States and also those States 
that are classified as ``underserved'' by the Department of 
Agriculture.
  Bottom line: If you are a Senator representing a higher risk State or 
specialty crops, I would be very nervous about the impact this 
amendment could have on producers being able to get adequate crop 
insurance service in your State.
  For those who think companies would not pull out, I would remind you 
that under the operating contract the companies sign with the 
Government, they are not required to sell in all States. They can pick 
which States they do business in.
  I know some are going to say: Well, OK, but then why are we doing 
these A&O expense reimbursements when traditional property and casualty 
companies do not get them?

[[Page 34200]]

  That is a question with an easy answer. In the traditional property 
and casualty business, companies are not required to do business with 
you or me. If they do so choose to do business with us, they get to 
determine the rates they should be charging on their policies. They get 
to load expenses into those rates. And they can require us to pay 
premiums upfront, premiums that can be reinvested and build the 
economy.
  Crop insurance is different. Similar to the property and casualty 
business, crop insurance companies do not have to do business in all 
States. But once they decide to do business in a State, they have to do 
business with any producer who wants to work with them. They are not 
allowed to cherry-pick.
  Crop insurance companies do not set their rates. They are all 
calculated and established by the Risk Management Agency. In addition, 
producers do not pay their premiums upfront. Depending on the crop they 
raise, and changes in this underlying bill, they will either pay their 
premiums within 30 days after harvest or by September 30 of each year. 
So the companies float the cost of doing business until these premiums 
come in. What if a producer fails to pay their premium? The company is 
responsible.
  Now, that is a major concern. Out in western Kansas, where we went 
through 5 consecutive years of drought, in some places a lot of 
producers and their lenders have told me if it was not for crop 
insurance and direct payments, they would not still be in business, 
especially our young producers and small banks.
  If you adopt this amendment, you are not punishing the crop insurance 
companies, you are punishing all the producers and farm families out 
there who are operating on the margins, while providing this country 
with the most affordable and safe food supply in the world.
  I urge my colleagues to vote against this amendment that I truly 
believe would kill crop insurance for our young farmers and ranchers.
  I yield back the remainder of my time.
  The PRESIDING OFFICER. The Senator from Ohio is recognized.
  Mr. BROWN. Madam President, how much time do I have?
  The PRESIDING OFFICER. The Senator from Ohio has 21 minutes; and 
there is 13 minutes in opposition.
  Mr. CONRAD. Madam President, might I ask unanimous consent by both 
sides to make a unanimous consent request at this time on behalf of the 
leadership of both sides?
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. CONRAD. Madam President, I ask unanimous consent, on behalf of 
the combined leadership, that the Senate stand in recess today from 2 
to 3 p.m.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Georgia.
  Mr. CHAMBLISS. Madam President, there was an understanding that 
Senator Grassley would be recognized for up to 5 minutes following 
Senator Roberts.
  Mr. BROWN. Madam President, I reserve my right to object. Rather than 
have three or four speeches in a row in support of this amendment, I 
would like to--particularly since I have more time remaining--at least 
use a couple minutes now. I will not give a long speech, but I would 
like to use a couple minutes responding to Senator Roberts and then go 
back and forth, if that would be acceptable to the Senator from Iowa, 
or if the Senator from Iowa has somewhere to go, I am fine with him 
speaking now. But I would like to speak afterwards.
  Mr. GRASSLEY. Madam President, I would like to speak for 5 minutes.
  Mr. BROWN. Madam President, I am fine with that. I would like to be 
recognized after Senator Grassley, if that is OK with the Senator from 
Georgia.
  Mr. CHAMBLISS. The Senator is correct. The normal procedure would be 
to go back and forth. After Senator Grassley, Senator Brown will be 
recognized, and then I ask that Senator Conrad be recognized after 
Senator Brown.
  Mr. BROWN. I thank the Senator. I certainly will reserve my time.
  The PRESIDING OFFICER. The Senator from Iowa is recognized.
  Mr. GRASSLEY. Madam President, it would be easy to say I associate 
myself with the remarks of the Senator from Kansas and let it be that 
way. But I was around when we set up the Federal crop insurance 
program. I wish to reflect on the rationale behind it and then, 
consequently, why I am going to vote against Senator Brown's amendment.
  Remember, for decades of a farm program, we may have had some crop 
insurance through the Government--and for hail through the private 
sector--that farmers could buy for some protection, but, for the most 
part, against natural disasters people relied upon the political whims 
of Congress to vote for or not to vote for disaster aid.
  So this crop insurance program was put in place to give farmers the 
ability to manage their risk, let the individual farmer make some 
determinations so he can take risks out of farming, out of the natural 
disasters that are connected with it--even now, you can take some of 
the price questions out that are involved with it--and manage his own 
risk as opposed to relying upon the Senators and the Congressmen to 
vote or not to vote or when to vote for disaster relief.
  So we put this in place. In order for it to be successful, you have 
to have a network to carry it out. This network is a private-sector 
network. I think it is working very well. I think it is in jeopardy if 
the Brown amendment is adopted.
  So I have some concerns about the amendment. It could have some very 
detrimental impacts on the crop insurance program that is so valuable 
to rural America. So I urge my colleagues to oppose this amendment 
because I do not believe the amendment is reform. It moves us back to a 
time when there was more of a reliance upon the political whims of 
Washington to devote disaster relief.
  The amendment seeks to further cut support of the Federal crop 
insurance program by several billion dollars simply to fund other 
projects. Additional cuts beyond what the Agriculture Committee has 
already adopted will prevent the program from providing assistance to 
America's farmers that is so vital to risk management.
  Over the years, Congress has insisted on having the Federal crop 
insurance program reach out to all farmers, especially small, 
beginning, and limited-recourse farmers. This is to be done in a fair, 
equitable, and nondiscriminatory manner, serving as an effective risk-
management tool that all can use.
  According to the Department of Agriculture, the program is succeeding 
at this objective. Additionally, crop insurance has become essential to 
many farmers in securing credit from a bank, rental agreements, as well 
as providing confidence to more effectively market their crops through 
the futures market where they can capture higher prices.
  The farmers in my State and across the country have used this tool 
over and over. It must be effective or they would not be using it and 
paying the premiums each year.
  The Senate Agriculture Committee reported a farm bill that contained 
a two-point cut to the administrative and operating reimbursement, a 
cut that represents nearly $750 million in reduced program cost. Any 
cuts to the A&O reimbursement rate beyond those two points that were 
agreed upon by the committee will likely undermine the program by 
threatening the service America's farmers both need and deserve.
  Further cuts could also jeopardize the continued viability of the 
private delivery system that is vital to the program's success. This 
could put private-sector employees out of work and result in the hiring 
of new Federal employees to serve farmers. Private-sector delivery is 
efficient and results in good services.
  Approximately 30,000 jobs are created by this industry. Those would 
be in jeopardy, and we would not have small farmers and ranchers 
serviced the way they are now.
  Further, the amendment's proposal to increase the quota share could 
weaken the crop insurance program

[[Page 34201]]

and may result in private insurers exiting the program.
  In fact, increasing the quota share is counter to the Federal policy 
of the past 25 years, which successfully has shifted more risk to the 
private sector for two primary reasons. First, private companies do a 
better job at loss adjustment. Both the Inspector General and the GAO 
have repeatedly focused on that point. Second, by shifting more risk to 
the private sector, Federal costs should be lower over time, as 
companies have more financial responsibility for indemnities.
  It has taken more than 25 years, and we do not want to lose that 25 
years.
  As a matter of transparency, I wish to tell everybody in the Senate 
that I participate in a crop insurance program. My constituents ought 
to know it, and my colleagues voting on it ought to know that as well.
  The PRESIDING OFFICER. The Senator from Ohio.
  Mr. BROWN. Madam President, I thank the Senator from Iowa for adding 
his knowledge to this debate.
  After listening to the Senator from Kansas, I think we might think 
the sky is falling in Kansas or in Ohio or in Iowa or in Georgia, that 
the sky is falling on the crop insurance companies.
  But when I hear the opponents of this amendment say crop insurance 
companies may go out of business because of this amendment, or a new 
argument today, that the reinsurer might go out of business--
reinsurance companies that insure the crop insurers--I think you 
should, again, look at this chart.
  On this chart is shown the number of dollars per policy that the crop 
insurance companies are paid. In the last 10 years, it slowly went up, 
until about 2004. So a crop insurance company writing a policy would 
get $591, 4 years ago. They would get this A&O subsidy, this 
administrative and operating subsidy. Then it went to $700, stayed 
around $700. Then it went up to $800 in 2006, the highest number in 
crop insurance program history. Then, this year, it is close to $1,200 
per policy of the subsidy. In addition to everything else with crop 
insurance, we don't need to get into the inner machinations of the 
subsidies in other ways. But this over-the-top subsidy--I have been 
very involved in Medicare issues. Medicare is about 2 percent of 
administrative costs that the Government pays them to operate the 
Medicare Programs in the 50 States. I don't make the comparison, 
generally, because it is a very different program. But we give them 
$1,100 for every policy they write--almost $1,200. Our amendment simply 
says: Let's go back to the last record-setting year, which is $830 per 
policy.
  So for Senator Roberts to claim they may go out of business--all we 
are doing is going back to the very profitable year they had when they 
were getting $830. This is all taxpayer dollars. These are private 
insurance companies making huge profits--making huge profits from our 
tax dollars. Again, I go back to the profit levels of these Federal 
crop insurance companies. These are private companies getting financing 
profits from taxpayers--twice the profits of the average private 
insurance property and casualty companies.
  Then I hear my friend from Kansas, Senator Roberts, talk about how 
business is going to be bad for farmers. Understand, no premium 
increase. This amendment increases no premiums; it doesn't touch 
premiums for farmers. But then he makes the case that--he does the 
oldest trick in the book, making the farmers' interests coincident with 
the insurance company interests. If you buy car insurance as a driver, 
you don't think your interests are always the same as the car insurance 
companies. When you get your health insurance plan, you don't think 
your interests are exactly identical with your health insurer. So to 
believe our taking some of the oversubsidized profits--taxpayer 
dollars--from the private crop insurance companies, that that means we 
are going after the farmers or that is going to hurt the farmers simply 
doesn't pass the straight-face test, and here is why.
  We spent, if you recall from my earlier comments, $10 billion in 
subsidies in the last few years which go to the farmers for crop 
insurance--a $10 billion benefit for farmers, but it took $19 billion 
of taxpayer dollars to get them those $10 billion. So in other words, a 
majority of crop insurance spending, this spending is taxpayer dollars. 
A majority of crop insurance spending goes to insurers, not the 
farmers. The farmers and the insurance companies don't have identical 
interests. I am very supportive of family farmers in my State. Most of 
the agriculture in my State is corn and soybeans. Most of the crop 
insurance premium dollars are insuring corn and soybeans in this 
country. Some 75 percent, if I recall, of crop insurance is about corn 
and soybeans. I am very supportive of those farmers. I will continue to 
be. I don't want to see taxpayers, whether they are taxpayers in rural 
Lexington, OH, or whether they are taxpayers in more urban Youngstown, 
OH, I don't want to see them giving all of these subsidies to insurance 
companies.
  Again, more than half the spending on crop insurance--more than half 
the spending--goes to the crop insurance companies, not the farmers. We 
are not touching the 46 percent that goes to farmers. We are not 
touching those dollars. We don't want those premiums to increase. We 
are saying, take a little bit away from the crop insurance companies. 
Go back to their 2006 levels of $830 per policy. They had huge profits 
in 2006. The crop insurance companies were thriving. The farmers were 
benefiting from these programs. Why give them the extra $342 per policy 
when that money could go to programs such as conservation for farmers; 
EQIP--an important program in Kansas--or go to McGovern-Dole or go to 
hundreds of millions of dollars in deficit reduction.
  So we are taking those taxpayers' dollars, giving them to these 
private insurance companies so their profits can absolutely go through 
the roof. Instead, I want those dollars to be used wisely. We are 
stewards of taxpayer dollars, as my farmers are stewards of their land. 
I want to support the farmers. I want to support the conservation 
programs. I want to support the feeding programs. I want to help reduce 
the Federal deficit. That is why the Brown-Sununu-McCaskill amendment 
makes so much sense.
  I reserve the remainder of my time.
  The PRESIDING OFFICER. Who yields time? The Senator from Georgia is 
recognized.
  Mr. CHAMBLISS. I yield 10 minutes to the Senator from North Dakota.
  The PRESIDING OFFICER. The Senator has only 7\1/2\ minutes left.
  Mr. CHAMBLISS. Did that include the additional 3 minutes we got?
  The PRESIDING OFFICER. Yes.
  Mr. CHAMBLISS. I ask unanimous consent for an additional 5 minutes 
for both sides.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  The Senator from North Dakota is recognized.
  Mr. CONRAD. Madam President, I rise to address the amendment of 
Senator Brown, the Senator from Ohio, proposing further cuts to crop 
insurance.
  First, I wish to acknowledge what a valuable Member Senator Brown is 
of the Senate Agriculture Committee. He has made a real contribution to 
the work of the committee in bringing this bill to the floor. I respect 
him for this amendment. He has offered this amendment because he thinks 
we need to beef up other parts of the farm program--nutrition and 
conservation--and at the same time he thinks there is more money going 
to the crop insurance industry than is warranted.
  Let me give an alternative view. The amendment before us would cut 
crop insurance by another $1.8 billion, in addition to the substantial 
reductions that have already been made in the committee bill. I would 
like to caution my colleagues about making even more cuts to crop 
insurance. As the bill stands now, we have already taken $3.6 billion 
over 5 years, $4.7 billion over 10 years from crop insurance to address 
other priorities in the bill. This amendment would increase those cuts 
by more than 50 percent. It would go well beyond what the House did, 
and it could have a very negative effect on producers' ability to 
insure their crops.
  Let's look at the reforms already contained in the committee bill. 
The

[[Page 34202]]

committee bill reduces the loss ratio from 1.075 to 1; it reduces 
catastrophic insurance and noninsurable--or it has fee increases for 
catastrophic insurance and the noninsurable program; it has reduced 
reimbursement for area plans; it has a 2-percent reduction for 
administrative and operating expenses; and it has total crop revenue 
offsets of $3.6 billion. That is not insignificant in terms of savings 
out of this program.
  When I look at the proposals of this amendment, I am concerned about 
the unintended consequences. Specifically, if we act hastily and 
unwisely without benefit of hearings in the committees of jurisdiction, 
we could lose participation of private insurance companies, smaller 
crop insurance companies that rely on reinsurance could exit the 
business, and producers would have fewer choices. Rather than having 
competing companies delivering a product, we would be begging them to 
stick around.
  The loss of participating insurance companies is only one part of the 
story. Reduced reimbursement for delivery of the program would result 
in agents abandoning the program as well. Where and how far will our 
producers have to travel to obtain coverage? I don't particularly like 
the prospect of farmers and ranchers calling my office telling me their 
agent has quit and they can't find someone to explain to them crop 
insurance. I think that might be the outcome if we adopt this 
amendment.
  Proponents have been quoting the GAO's May report as justification 
for further reductions. I read the report. I also read a report 
completed by the respected accounting firm of Grant Thornton. Frankly, 
I am concerned that when GAO made its comparisons of crop insurance 
profitability to property and casualty insurers, they were comparing 
apples and oranges.
  The GAO compared profitability over 5 years, showing crop insurance 
at 17.8 percent return compared to 6.4 percent for property and 
casualty. Of course, that comparison included the only loss year for 
property and casualty and relatively good years for multiperil crop 
insurance. Grant Thornton instead looked at a 14-year period. Their 
analysis shows something quite different, with crop insurance 
profitability at 12.2 percent compared to 17.4 percent for property and 
casualty. Further, Grant Thornton notes that crop insurance expenses 
have fallen short of administrative and operating reimbursements since 
1997. That is quite a different story.
  Grant Thornton's report suggests the GAO didn't make fair comparisons 
because they chose nonrepresentative years and did not account for 
significant differences between property and casualty insurance and 
crop insurance. Frankly, there is a dramatic difference between crop 
insurance and what is required in order to provide it and other 
insurance products. There are more administrative expenses to 
administer a crop insurance program than most of us understand. Agents 
are constantly being trained and retrained to keep up with the new 
Government rules we pass. They need to understand not only government 
regulations but company rules, loss adjustment, and maintain production 
history records.
  In addition, loss adjustments occur on a much greater frequency than 
for any property and casualty company. I have actually had perhaps the 
misfortune of studying insurance in college. Crop insurance is a 
totally different insurance coverage than other insurances that have 
been referenced on the floor. It is no wonder Grant Thornton reported 
crop insurance expenses have exceeded administrative and operating 
reimbursement every year since 1997. I might add, while the GAO 
outlined what they believe are vulnerabilities for fraud, waste, and 
abuse, this amendment doesn't do anything about those questions. In 
fact, because it reduces available resources for administration, I am 
inclined to think this proposal may make the fraud and abuse situation 
worse.
  While I applaud my colleagues for trying to increase resources for 
conservation and nutrition, I would point out the bill before us 
increased conservation by over $4 billion above the baseline, increased 
nutrition by $5 billion above the baseline, and we did it largely by 
taking money from crop insurance already. This is a double hit.
  We have taken nearly $7.5 billion from the commodity programs. We 
have taken $4.2 billion directly from commodities, and over $3.6 
billion from risk management. Where did the money go? The money went to 
nutrition and conservation. They were the big winners. It is like 
people have completely forgotten what occurred.
  This is a chart that shows the sources and uses of funds. Thirty-four 
percent of the money--the new money--provided in this bill came out of 
commodities. Thirty-two percent--almost a third--came out of crop 
insurance. We have already tapped them. Where did the money go? Forty 
percent of it went to conservation, and 47 percent went to nutrition. 
Now, when is enough enough? When is there a fair balance?
  I wish to emphasize, we have hit the commodity title for $7 billion 
already. When does it stop? When is enough enough? When is fair fair? 
Sixty-six percent of this bill is going to nutrition. Sixty-six percent 
of this bill is going to nutrition. Nine percent of this bill is going 
to conservation.
  Commodity programs are less than 14 percent. Let's be clear. When we 
wrote the last farm bill, it was estimated that three-quarters of 1 
percent of Federal spending would go to commodity programs. But that 
isn't what happened in the real world. We didn't get three-quarters of 
1 percent of Federal spending; we got one-half of 1 percent of Federal 
spending in the current farm bill for commodities. You know how much we 
are going to get in this farm bill? Not three-quarters of 1 percent, 
not one-half of 1 percent, but one-quarter of 1 percent. That is what 
is going to go for commodities in this bill.
  This amendment says let's take another $1.8 billion and give it to 
the parts of the bill that have already been the big beneficiaries, the 
part of the bill that already has had the biggest increases--
conservation that got 40 percent of the new money, nutrition that got 
47 percent of the new money.
  This amendment ought to be defeated. There are questions raised by it 
that are legitimate and they ought to be the focus of a hearing. The 
House already agreed to do so. The Senate ought to follow suit, but we 
ought not to make a rash, hasty decision that can endanger crop 
insurance, which is critically important for our producers.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Whitehouse). Who yields time?
  The Senator from Ohio is recognized.
  Mr. BROWN. Mr. President, will the Chair let us know how much time 
remains on each side?
  The PRESIDING OFFICER. The Senator from Ohio has 17\1/2\ minutes, and 
the Republican side has 2 minutes.
  Mr. BROWN. I thank the Chair.
  Will Senator Roberts take his last 2 minutes?
  Mr. CHAMBLISS. I am sorry, what is the question?
  Mr. BROWN. I have a good bit of time left. You have a couple of 
minutes. I want to close, but I want to make some comments first.
  Mr. CHAMBLISS. The Senator can talk and we will take our 2, and then 
he can close.
  Mr. BROWN. I thank the Senator. I think we should wrap this up.
  I appreciate the comments of my friend from North Dakota, who has 
fought more effectively and passionately for his farmers in North 
Dakota than perhaps anybody in the Senate. But this debate is not about 
how much money has gone to conservation, to nutrition, or in or out of 
direct payments. This amendment is the subsidies, the taxpayer dollars, 
that go directly into crop insurance, the huge, bloated subsidies, the 
taxpayer dollars, that go to these companies that, by any measurement, 
are the most profitable insurance companies in America--Federal crop 
insurance, with 17.8 percent profits; and private property and casualty 
insurance, with 8.3 percent.
  I know crop insurance is different; they have Federal rules. But in 
the end, this profit is all about taxpayer subsidy. This is the same 
kind of profit that a private property and casualty insurance company 
has. It is taxpayer

[[Page 34203]]

dollars from taxpayers in Providence, RI; Topeka, KS; Columbus, GA; and 
Mansfield, OH.
  I heard Senator Conrad's discussion of a Grant Thornton analysis over 
the last dozen or so years. I don't know who paid for that study. It 
doesn't matter. I know who paid for the GAO study, and I know about the 
professionalism, even though called into question by my friend from 
Kansas, when the audits don't come out the way some people want them 
to. I know about their professionalism and what they said about crop 
insurance, and I know what they said about overpayments and 
profitability.
  Most importantly, that study from Grant Thornton looks over a period 
of many years. I probably would not have offered this amendment in 
1999, 2000, 2001, or 2002. But look at where we are today. Look at the 
subsidies we provide to crop insurance from taxpayer dollars. I repeat 
that these are taxpayer dollars, the subsidies to these crop insurance 
companies: $723, $696, $830 per policy with the subsidy, leading up to 
this year, when the policy jumps to a $1,172 subsidy.
  All we are saying is to take this huge overpayment from this year and 
go back to the already very profitable year in 2006. This is not a 
debate about what farmers get. Farmers' premiums don't increase. They 
will get the same services. Farmers will still have the same access, in 
spite of what some people say, to these crop insurance policies. So it 
is a matter of whose side you are on. Are you on the side of the 
farmers or the taxpayers and the side of conservation and nutrition? Or 
are you on the side of a very small number of crop insurance companies 
that are reaping huge profits, getting huge subsidies, getting bloated 
numbers of dollars from taxpayers in their pockets? Whose side will you 
be on? We should be on the side of the family farmers and taxpayers.
  I reserve the remainder of my time, and I will close after Senator 
Chambliss uses his last couple of minutes.
  The PRESIDING OFFICER. The Senator from Georgia is recognized.
  Mr. CHAMBLISS. Mr. President, crop insurance has experienced 
tremendous growth and success since the enactment of the 2000 crop 
insurance bill, which increased premium subsidies to producers and made 
other program improvements. In my State of Georgia, we were not a big 
user of crop insurance in years past. In 1994, only 38 percent of 
eligible acres were insured; whereby, in 2006, 89 percent of eligible 
acres were insured. This is a valuable tool that our farmers now have 
available to them, and it saves the taxpayers money by decreasing the 
amount of annual emergency disaster programs we have to come and ask 
for relative to agriculture.
  In the committee-approved farm bill, over $4.7 billion has been taken 
out of the crop insurance program to fund other farm bill priorities. 
These savings were achieved to answer criticisms of the program, some 
of which were raised by Senator Brown, and are directed to improve 
operational efficiency. We have tried to manage these funding 
reductions in a way that will not unduly harm the program or the 
delivery system.
  Twenty-one agricultural organizations have sent a letter opposing the 
Brown amendment. I ask unanimous consent that that letter be printed in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                December 12, 2007.
     Hon. Saxby Chambliss,
     U.S. Senate,
     Washington, DC.
       Dear Senator Chambliss: We urge you to vote ``no'' on the 
     Brown-Sununu-McCaskill amendment that is said to ``reform'' 
     the federal crop insurance program.
       The Senate Agriculture Committee has already carefully 
     considered the crop insurance program and adopted manageable 
     changes that reduce costs and improve efficiency while 
     capturing nearly $4 billion in savings to fund other farm 
     bill priorities.
       The public-private partnership responsible for managing and 
     implementing the program has responded very well over the 
     years to Congress' desire to have a federal crop insurance 
     program that reaches out to farmers across the nation, 
     especially small, beginning and limited-resource farmers, in 
     a fair, equitable and non-discriminatory manner to provide 
     effective risk management. There is very tangible evidence 
     the program is achieving this objective. For example, farmer 
     risk protection is projected to reach at least $65 billion in 
     2007, providing protection to more than 80 percent of the 
     insurable acreage.
       With this magnitude of expansion, crop insurance has become 
     essential not only for individual farmer risk management, but 
     also, in many cases, to borrow money or rent land. Without a 
     crop insurance safety net that is fairly and effectively 
     available, many family farms will not be able to rent land 
     and obtain credit to produce a crop. Furthermore, the crop 
     insurance program helps farmers have the confidence to more 
     effectively market their crops through the futures market 
     where they can capture higher prices and increase their 
     annual income.
       We are concerned the changes that would be made to the crop 
     insurance program by the Brown amendment have not been 
     thoroughly and effectively analyzed by the Agriculture 
     Committee and will cause unintended harm to the availability 
     and delivery of a vital farm security program.
       To protect what it has taken Congress more than 25 years to 
     build, we urge you to vote ``no'' on the Brown amendment.
           Sincerely,
       American Soybean Association.
       American Sugar Alliance.
       Corn Producers Association of Texas.
       Minnesota Corn Growers Association.
       National Association of Wheat Growers.
       National Barley Growers Association.
       National Cotton Council.
       National Farmers Union.
       National Sorghum Producers.
       National Sunflower Association.
       New Mexico Peanut Growers Association.
       North Carolina Peanut Growers Association.
       Oklahoma Peanut Commission.
       Peanut Growers Cooperative Marketing Association.
       Southwest Council of Agribusiness.
       USA Dry Pea & Lentil Council.
       USA Rice Federation.
       US Canola Association.
       US Rice Producers Association.
       Virginia Peanut Growers Association.
       Western Peanut Growers.

  Mr. CHAMBLISS. Mr. President, these organizations recognize the 
importance of a solid crop insurance program, and in the letter they 
state:

       Without a crop insurance safety net that is fairly and 
     effectively available, many family farms will not be able to 
     rent land and obtain credit to produce a crop.

  They express concern that changes proposed by Senator Brown will 
cause unintended harm to the availability and delivery of this vital 
farm security program.
  With that, I urge a vote against the Brown amendment.
  I yield back our remaining time.
  The PRESIDING OFFICER. The Senator from Ohio is recognized.
  Mr. BROWN. Mr. President, I will not use all my time. I have a couple 
of points. Several of the speakers have said that the committee already 
made substantial cuts in crop insurance subsidies from the Government. 
That is not quite true. There was a bit of a cut, but the cuts were 
much less than the House of Representatives had in their bill. The 
House made cuts in the shared risk and the A&O, the administration and 
operating expenses. They say the crop insurance companies were already 
cut by $3.5 billion. The vast majority of these savings were due to the 
sleight of hand, the shifts in time. The CBO cost estimate indicates 
that only $700 million were actually cut.
  According to the CBO, the supplemental disaster package adds an 
additional $2.1 billion to crop insurance. So they took a little here 
and added more there. It adds up to a net gain of $1.5 billion to crop 
insurance companies. Their lobby is strong and they are doing well. 
They have a lot of influence on this body. But the fact is, in the end, 
this is about one thing: This chart shows that the majority of crop 
insurance spending goes to insurers, not family farmers or large 
farmers--not to farmers, period. A majority of this money--the 
underwriting gains paid to companies was $840 million. Administrative 
subsidies paid to companies was $960 million. Fifty percent of crop 
insurance spending goes to crop insurance companies, not to farmers.
  About $10.5 billion in the last 7 years has gone to farmers 
benefiting from the crop insurance program, but it took $19 billion 
from taxpayers to pay them that $10 billion. What kind of program is 
that? We get $10 billion in public benefits, but it takes $19 billion 
to

[[Page 34204]]

provide those public benefits. No other Federal program does it that 
way. If it were Medicare, we would bring them in here and have hearings 
and destroy them if they were spending that much of the services they 
are supposed to provide, with that much in administrative costs. Again, 
over 50 percent--more than half--of crop insurance spending goes to 
insurers, not farmers.
  The Brown-Sununu-McCaskill amendment will do what we need to do. It 
will say no more bloated, oversubsidized spending, no more taxpayer 
dollars of this magnitude will go to the crop insurance companies. 
Let's use that money for nutrition, for conservation--and, again, don't 
forget, hundreds of millions of dollars from the Brown-Sununu-McCaskill 
amendment will go to reduce the national debt. Taxpayers save, family 
farmers are better off, and the natural resources in this country--
something Senator Harkin has worked so effectively on for so many 
years--will make all of the difference in this. I ask my colleagues to 
vote for the Brown-Sununu-McCaskill amendment.
  I yield the floor.
  Mr. HARKIN. How much time remains?
  The PRESIDING OFFICER. There is 10 minutes.
  Mr. BROWN. Mr. President, I will yield whatever time I have left to 
Senator Harkin.
  Mr. HARKIN. Mr. President, I take a back seat to no one in my support 
for the crop insurance industry. I was here, as Senator Grassley said, 
on the House Agriculture Committee when we set up this system. I was on 
the Conservation and Credit Subcommittee. I remember why we did this. 
We had a bad system before, with the Government putting these policies 
out, relying upon ad hoc disaster payments. Eventually, we went to all 
crop insurance delivered through the private sector. I was one of the 
initial supporters of that. I fought very hard for the private sector 
to get this business, for obvious reasons. No. 1, we had our private 
companies out there already insuring houses, cars, and different 
things, such as equipment, for farmers. Why should they not also 
provide crop insurance? It made logical sense.
  I think the years have proven us right. The private crop insurance 
industry in America has worked well. It has done an outstanding job. It 
has met all of the things we expected them to do when we created this 
program in 1982. So I have followed this all these years, and I have 
supported this industry and what they have been doing all these years. 
I still do. I take a back seat to no one.
  I will be frank; when the Senator from Ohio first came up with his 
proposal on crop insurance in my discussions with him, I thought this 
was too big of a cut. I thought it was a little bit too heavy. I 
thought they were too harsh. But I do think that over the weeks, in 
working with Senator Brown and in moderating the size of the cuts and 
to shape the message about what needs to be done to reform the 
financial incentives provided to crop insurance companies, I think he 
is on the right path. I think the Senator from Ohio makes valid points 
about the problems with the current mechanism for reimbursing private 
crop insurance companies for the expenses they incur in delivering the 
Federal crop insurance program for farmers.
  No one who is knowledgeable about how the program works--and I 
believe I am very knowledgeable about it--can deny that the significant 
increase in total premiums over the last few years has been driven by 
the increase in commodity prices, especially corn, wheat, and soybeans, 
which has resulted in an increase in A&O reimbursement per policy. That 
surge generated higher revenues for the companies that have not 
necessarily had an increase in expenses over the same period.
  So we have had a system whereby the reimbursements are tied to 
commodity prices. Well, we have seen this huge increase in commodity 
prices in the last few years. In fact, I penciled out here that we went 
from about $3.5 billion to more than $5 billion in just a few years.
  The insurance companies get, as we know, 21 percent of that amount. 
That is the reimbursement rate, 21 percent. That is a huge increase. 
The Senator from Ohio pointed out on his chart the increases in those 
years.
  What the Senator is proposing is that we take the average of, I 
believe, it is 2004, 2005, and 2006, and we cap it at that level. It 
does not apply to the crop-year of 2007, and it would not apply to 
2008, if I am not mistaken. I think it starts in 2009. It does not 
apply to 2007 or 2008. It does not start until 2009.
  I have told some of my friends in this industry that I think this 
approach may be better for them in the long run to base it on those 
levels rather than to roll the dice. We have seen crop prices go up, 
and we have seen them go down. Obviously, I would like to see them stay 
up. But that is ignoring history.
  I said to my friends in the industry: Look, this is not a bad deal. 
We cap the highest levels we have seen, except for this year, 
obviously, for 2007, and that is the reimbursement rate. I think it 
might in the long run be better for them.
  I don't see this as onerous on crop insurance. Some say there is 
going to be this big cut, but that does not apply to 2007 and 2008. By 
the time we get to 2009, there may not be any cuts at all, as a matter 
of fact, depending upon what happens with prices. In fact, it may be 
better. It actually may be better.
  In exchange, what we do get is some more money for conservation, for 
EQIP. We need more money in the EQIP program, the Grasslands Reserve 
Program, the Farmland Protection Program, as well as the McGovern-Dole 
Food for Education Program. I think it is a pretty fair tradeoff. If I 
thought for 1 minute this was going to devastate, destroy, unduly harm 
the crop insurance industry, I could not support it. But I believe it 
is a fair and equitable approach and, quite frankly, I think the 
methodology is much better in the long term. ``Long term,'' what do I 
mean? Five years? Probably 5, 7, 8 years. It may be better for the crop 
insurance industry than hooking onto commodity prices.
  Quite frankly, thinking back over the years, I find it hard to argue 
why it should be connected to commodity prices. What does that have to 
do with reimbursement? What does that have to do with policy numbers? 
We should have something that will protect our insurance people from 
undue happenings and events such as that, and I think that is what this 
methodology does. We took the average of those 3 years and capped it at 
that. In conference, we can look at putting in an inflation factor.
  It seems to me that makes much more sense for the future of the 
program. As I said, for that we get more money for the conservation 
programs, the McGovern-Dole International School Lunch Program, and it 
also lifts the sunset provision on our nutrition program. Right now the 
increases we put in the Food Stamp Program with the standard deduction 
and minimum benefit sunset in 5 years.
  Someone in the Democratic Caucus said recently to me: Why are we sun-
setting in 5 years the programs that go to the poorest people in our 
country, yet we don't sunset the programs that go to some of the 
wealthiest people in our country? Fair question. So in order to lift 
this sunset, we need additional money, and the money we would save 
would go to lift the sunset provisions on both the standard deduction 
and the minimum benefit.
  For those reasons, I support the amendment.
  Mr. President, I yield the floor.
  Mr. BROWN. Mr. President, I yield back our time on the amendment. I 
thank the Senator from Iowa.
  Mr. ROBERTS. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. HARKIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Brown). Without objection, it is so 
ordered.
  Mr. HARKIN. Mr. President, I ask unanimous consent that at 3 p.m.

[[Page 34205]]

today, the Senate proceed to conclude the debate with respect to the 
Klobuchar amendment No. 3810, and that the previous order with respect 
to the vote threshold remain in effect; that upon the use or yielding 
back of time, the Senate proceed to vote in relation to the Klobuchar 
amendment; that upon disposition of that amendment, the Senate then 
vote in the relation to the amendments listed below in the order 
listed; that there be 2 minutes of debate equally divided and 
controlled prior to each vote; that after the first vote, the vote time 
be limited to 10 minutes; with no second-degree amendment in order to 
any of the amendments covered under this amendment, prior to the vote; 
that the amendments covered here be subject to a 60-vote threshold; 
that if any of these amendments achieve an affirmative 60 votes, it be 
agreed to and the motion to reconsider be laid upon the table; that if 
it does not achieve that threshold, it be withdrawn: Coburn amendment 
No. 3530; Tester amendment No. 3666; Brown amendment No. 3819, and that 
the managers' package of cleared amendments be considered and agreed 
to, and the motion to reconsider be laid upon the table.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. HARKIN. Mr. President, I guess we are going to be in recess for 
an hour, from 2 to 3 p.m. We will come back at 3 p.m. and finish debate 
on the Klobuchar amendment. We will have that vote, and at the 
conclusion of that time, we will have three other votes. There should 
be four votes in sequence at that time.

                          ____________________