[Weekly Compilation of Presidential Documents Volume 31, Number 22 (Monday, June 5, 1995)]
[Pages 943-950]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Remarks in a Roundtable Discussion With Farmers and Agricultural Leaders 
in Broadview, Montana

June 1, 1995

    The President. Thank you very much. I want to mostly just listen to 
you, but I thought that it might be helpful for me to talk for a minute 
or two about the kinds of decisions that are coming before our country 
in the next year, on the farm bill and other things.
    I want to thank Senator Baucus, and I want to thank Congressman 
Williams for always making sure that the White House and the President 
know about the concerns and the interests of the people of this State. 
They have never been bashful about doing that, and they've done a pretty 
good job of it. And I thank them for that.
    I have been concerned about the interest and welfare of agriculture 
and rural America generally for a long time and a long time before I 
became President. A lot of you know that the State where I lived, 
Arkansas, where I was Governor for 12 years, is a big agricultural 
State. And it's a different kind of agriculture, by and large. I had Les 
take me out in the field and explain how you bring in the wheat crop, 
when you do it, and how you decide what land to lay out. But my State is 
principally rice, soybeans, and then wheat, and chicken and also a lot 
of--there's a big hog-growing operation and a sizable cattle operation 
there.
    And I've been through a lot of things with farmer friends of mine. I 
was Governor all during the 1980's when we lost a lot of our farmers, 
and a lot of my friends went down. And we were struggling even to keep 
our rural banks alive and keep them in a position where they could 
finance farms. We changed all of our State laws to try to do that. So 
I've seen the worst times of agriculture.
    I think the '90 farm bill in many ways has worked reasonably well, 
although I think there are some problems with it. Since I have been 
President, I have worked very hard on an overall economic strategy for 
our country which kept in mind the important role of agriculture. We 
have fought like crazy to have more trade and fairer trade for American 
agriculture.
    We were able to get the GATT world trade agreement because, after 
years and years of fighting, we were able to persuade the Europeans to 
agree to reduce their agriculture subsidies so that they wouldn't be 
pushing us out of markets because they were subsidizing to a greater 
extent than we were.
    We were able to begin to export some things to Japan and China and 
the Far East that we'd never been able to export before, principally 
rice, apples, and other fruit products. We negotiated, as Max said, this 
one-year agreement with Canada and set up this commission to try to 
resolve this problem that they have. And as you know, they--you 
understand this far better than I do--but there were some things which 
happened in the original trade negotiations with Canada, and there are 
some things that are basically endemic to the way they organize their 
agriculture which make it almost impossible for us to get a fair deal 
unless we have a specific bilateral agreement on it. So we've been 
working very hard on that.
    A few weeks ago, I went to Ames, Iowa, to Iowa State University, and 
had a national rural conference and talked to farmers from all over the 
country about some other problems we've got, specific problems like the 
beef problem with Korea. And we also talked about the need to continue 
in this new farm bill a decent level of support for agricultural 
research, a decent level of effort and a greater effort for the 
development of alternative products out of the farming now done in 
America.
    We had farmers from the Middle West bring some very impressive 
things that they had made from their sort of side businesses in 
agriculture, including windshield wiper fluid. And they even gave me 
some golf tees, which I used. They're biodegradable, and that's 
important because I break one every time I swing a club. [Laughter]

[[Page 944]]

    I think it's very important that, as we look ahead, that we deal 
with not only the question of how much we're going to spend on 
agricultural supports, but what these programs are going to look like. 
Are we going to have, for example, a greater effort to help young 
farmers get into farming, when the average age of farmers keeps going up 
and up and up? Are we--if we want to get the prices up and have a long-
term responsible program for the environment, shouldn't we preserve the 
conservation reserve program, or something awful much like it, no matter 
what we do to the rest of the farm supports?
    And then there's this larger question of what the overall role of 
agriculture is to America. Yes, we do spend a substantial amount of 
money on farm supports. But as all of you know, we spend dramatically 
less than we did 10 years ago. The supports were cut a lot in '85; they 
were cut a lot in '90 and '93. And then again in this '96 budget, we 
proposed some modest cuts, mostly to tighten up the income eligibility.
    But my belief is that since agriculture is producing this year over 
$50 billion worth of farm exports, the largest dollar value of exports 
in our history, we're going to have more than a $20 billion trade 
surplus in agriculture. And to give you some idea of the figures, 
roughly, we'll have a trade deficit maybe of something over $100 
billion. And 60 percent of it is in automobiles from Japan and auto 
parts, and the rest of it's in oil. And otherwise we're pretty much in 
balance, thanks almost entirely to the massive surplus we enjoy in 
agriculture and in the sale of airplanes and airplane parts. And 
otherwise, we're more or less in balance.
    So to me this is a very big thing. And I know--I imagine people in 
Montana are pretty much like people in Arkansas; everybody wants to see 
the budget brought into balance. Everybody knows that things got haywire 
in the last 12 years. You need to know that the budgets that Max and Pat 
voted for would have the Federal Government in balance today. We would 
have a balanced budget today but for the interest we have to pay on the 
debt run up between 1981 and the day I became President.
    So we turned this deficit thing around. We need to keep bringing it 
down, but we need to look at the agricultural issue in light of how you 
live here and the importance to the United States of this massive 
economic strength we have in American agriculture, which means every 
person in the country has benefited by what you do, by having the 
cheapest, best food in the world, and also by having an enormous 
economic weapon in a global economy.
    So that's kind of the perspective I'm looking for. We're going to 
have to make some changes in the farm program, but I want to get your 
feedback on your lives, your work, your experiences, and what you think 
we should be thinking about as we--number one, we're coming up to the 
end of the one-year deal on the Canadian agreement, as Max said, but 
we're also going to have to rewrite the farm bill. We do it every 5 
years, and this year it coincides with this effort that is being made to 
balance the budget.
    So we need to really think this through. And that's why I wanted to 
be here. And I'm not going to say any more. I want to listen to you now.
    Senator Max Baucus. Thank you very much, Mr. President. Anybody who 
wants to--Diana or Steve?

Export Enhancement Program

[At this point, Steve Heiken asked about congressional appropriations 
for the Export Enhancement Program.]

    The President. Well, I like that program. I've used it quite a lot, 
the Export Enhancement Program. And if they refuse to appropriate any 
money for it, then I will try to offset the impact of that by two 
things. One is trying to get our Trade Ambassador, Mr. Kantor, to go 
back and do even more than he's already done. I think he's the best 
trade person we've had in many, many years, but there may be some things 
he can do. And secondly, there may be some other ways that we can help 
other countries to finance agricultural purchases through other 
instruments of other financial institutions.
    I think it would be a mistake to do away with the EEP completely, 
given the way the world works now. You know as much or more about it 
than I do, but I think we ought to maintain the program.

[[Page 945]]

Regulatory Reform

[Citing his own farm as an example, Les Auer asked if farmers could be 
better stewards of the land without excessive Government regulation.]

    The President. In general, I think the answer to that is yes. I 
think the trick is, from my point of view, is how to get the best 
environmental results and have some standard that will also deal with 
the people that might abuse their privileges, and how to do it with 
fewer regulations. And I think there are ways to do it.
    Let me just say, for example, in the Agriculture Department, 
Secretary Glickman is in the process of cutting the regulations of the 
Ag Department. And the target is to save the farming population of our 
country and others regulated by the Ag Department 2.5 million hours a 
year and $4 billion a year by reductions. The EPA is cutting their 
paperwork burden by 25 percent in one year.
    And basically what we're trying to do is to go to a system in which 
we can go to people and say, ``Look, here are the general standards in 
the law and the things that are necessary to preserve the land, water, 
and air over the next generation. But this rule book is not necessary if 
you can meet the standards however you please, if you can find some 
other way to do it.'' We're now doing that through the EPA. We're going 
to have 50 experimental projects where we just go to people and say, 
``Can you meet the standards, and if you do, you can get rid of the rule 
book.'' And so that way we'll have the benefit of a common standard and 
a common commitment to environmental protection without having the cost 
and burdens of excessive regulation.
    I think that the regulatory system in America has basically built up 
over the last 35 years under Democrats and Republicans alike. And partly 
it has come about because of the abuses that are there. But believe it 
or not, sometimes even the people who are being regulated wanted us to 
be more specific and more detailed because they thought that would 
protect them in other ways.
    The problem is there's no way to write rules and regulations that 
cover every commonsense occurrence that will happen in the life of a 
farmer or a businessperson. You just can't do it. We were talking about 
it last night at dinner.
    So anyway, we're trying to move to a different regulatory system 
which would keep our commitment, our common commitment, to a clean 
environment or to a safe workplace, but would give the people who have 
previously been overregulated far more freedom in deciding how to meet 
those objectives. And I think that's the right way to compromise this 
out.

Ethanol

[Mary Schuler asked about efforts to increase ethanol use, in view of 
the court ruling against the 30 percent mandate.]

    The President. Well, as you know, I'm a strong supporter of that 
program. We prevailed by one vote because the Vice President had to go 
over to the Senate and vote for it. Remember that? One of Al Gore's best 
lines is, every time he votes we win. [Laughter] But we won that day. 
And then they took us to court, and we lost.
    We're looking at the case now, reviewing it, to see whether or not 
we think we've got any chance at all to prevail on appeal. And if we 
think we've got any chance at all, we're going to appeal the thing. But 
we're reading it now and trying to reach a judgment about that.
    And I would be interested in knowing from you whether there are some 
other things we can do to increase the use of ethanol, because I think 
that's good environmental policy as well as good farm policy. And again, 
it adds to the value of the farm dollar in America. And to whatever 
extent we can add to the value of the farm dollar in America, we are 
thereby less vulnerable to the vagaries of the global economy, to what 
happens in the weather or the politics or the finances of some other 
country. We'll be a lot better off.
    So if you have any specific ideas or you or any of your 
organizations want to give me any more ideas about what else I can do to 
promote ethanol use, I will, because I'm strongly in favor of it. I 
think it's good economics. It's good environmental policy. And it helps 
us to become more independent.

[[Page 946]]

    Mary Schuler. There is legislation, isn't there, that the Government 
vehicles are to use ethanol? Is that being----
    The President. Yes, that's a possibility. One of the things we're 
trying to do is to see to what extent the Government can be a leader in 
all these areas, because we're trying to get the Government to--we could 
use more ethanol; we could use more natural gas in vehicles. There are 
lots of things we can do that would strengthen our energy independence, 
and that's one option.
    I don't know that the volumes will be enough to make a significant 
difference in your price in Montana, but it's something we could begin 
to do. The Government has the capacity to create certain markets, and at 
least to demonstrate to others that they work. So that's something maybe 
we ought to look at. We might be able to do that without legislation. 
I'll look at it.

Extension Program

[Kelly Raths, a 4-H representative, expressed support for full funding 
of the agricultural extension program.]

    The President. When I was at Montana State yesterday, I said if 
every kid in America were in 4-H, we'd have about half of the problems 
we've got. I believe that.
    Kelly Raths. That's right.
    The President. Let me explain how this budget works. The Senate and 
the House pass a budget resolution, and basically, what they do is to 
make certain commitments on deficit reduction in general terms and in 
categories. The actual budgeting, then, passes over--as soon as the 
Senate and the House resolve their disagreements because their budgets 
are different, principally, in the volume of the tax cuts and who gets 
them and when they would come and all that--when they resolve that, then 
the appropriations committees go to work, so that while these budget 
resolutions may not have suggested any cuts in any particular programs, 
or may have suggested drastic cuts in other programs, the appropriations 
committees may differ entirely, and the only thing they'll have to do is 
to meet a certain level of cut for all the things that are within each 
subcommittee of the appropriations committee.
    So it's not clear which programs will be cut and which programs will 
be exempted from this resolution. Those are just suggestions from the 
committee, but these budget committees set the outline. Then the 
appropriations committee have to really make the budget decisions.
    But essentially, I agree with you. The programs are good. I think 
they're of modest cost, and they benefit huge numbers of people, and 
they're the kind of--if you will, the kind of preventive character-
building programs that I've tried to support in the crime bill, and I'm 
having a harder time getting protected there.

Conservation Reserve Program

[Bud Daniels expressed support for the conservation reserve program as 
an environmentally beneficial alternative to unnecessary increases in 
production of grain or livestock.]

    The President. Cattle prices don't need to go in that direction.
    Bud Daniels. No, they don't.
    The President. Well, the honest answer to your question is--first of 
all, let me point out, just going back to what Les said--the 
conservation reserve is a classic example of the kind of 
environmentalism we ought to be practicing in this country. Instead of 
beating somebody over the head with a stick and giving them a rule book 
nine inches thick, here is an incentive to basically restore wildlife 
and biodiversity. And it's been, I think, a resounding success.
    Now, it's like everything else. People can show you where there's 
been something or other they don't like about it, but it's basically 
worked. It's done what is was intended to do, in my opinion.
    The answer to your question, whether it will survive or not, depends 
upon, in large measure, upon you and the other people in agriculture 
throughout the country, and on the decisions that we all have to make 
once we decide how much overall agriculture has to be cut.
    The thing that I don't like about the way that this budget process 
is unfolding is, if you decide--it's kind of backward--if you decide, 
well, you're going to have to balance the budget in 7 years instead of 9 
or 10 or some other time, and you decide that you're

[[Page 947]]

going to have to set aside a certain amount of money for a tax cut, then 
you wind up being very arbitrary in how much you're going to cut various 
things.
    And what we really ought to say is, go back to what Max said--I 
believe most farmers in America would gladly give up all of their 
Government subsidies--we might still want a conservation reserve for 
environmental reasons--but would gladly give up all of their Government 
subsidies if all of our competitors would. So this is, as I keep 
hammering this issue, this is a question of our standing in the global 
economy. We worked like crazy to pass the GATT so we could reduce some 
of our subsidies but so that competitors of ours that subsidize more 
would have to reduce more.
    So the simple answer to your question is--let's just say--I 
proposed, because of the GATT, another $1.5 billion in reductions in 
agricultural subsidies. They propose, I think, $8 billion or $9 billion. 
I think that's an excessive number over a 7-year period. But let's say 
that the $8 billion number passes, or it's a $5-billion number, whatever 
it finally is, then you've got to--then you, the agricultural community, 
have to figure out what is the most sensible way to allocate that cut. 
And if you want to keep the conservation reserve, then you've got to 
give up more of something else. And if you want to modify it, then you 
maybe make it less costly, and you do something else.
    These are decisions we're all going to have to make together. I 
guess that's the one thing that I want to impress upon you today, is 
that--I have a Secretary of Agriculture from Kansas who served for 18 
years in the Congress; I care about this issue and whatever level of 
funding we wind up with; we need to make the best decisions.
    If the farm supports are cut, are they going to still be the way 
they are now? Are we going to give farmers more flexibility within the 
support framework to decide what they plan? Is that a good or a bad 
idea? These are things that we need input from the agriculture community 
on.
    But this is not a done deal yet. No one knows what the final number 
is going to be and what the final form is going to be. And I think you 
ought to be able to shape it, looking at what has worked fundamentally 
in the 1990 farm bill and what the continuing problems are.

Livestock Industry

[Gary Ruff asked if the Justice Department could investigate possible 
antitrust violations in the cattle market.]

    The President. I mean, do you think that the market may be so 
concentrated that it violates the antitrust laws?
    Gary Ruff. I do.
    The President. Well, I think that ought to be explored. If you think 
there's a credible case for that, we'll look into it.
    Mr. Ruff. Well, the Packers and Stockyards Commission is doing some 
looking into it, but I really feel that the Justice Department----
    The President. But the Antitrust Division needs to look into it as 
well.

Family Farms

[Keith Schott described his situation as a young family farmer and asked 
about expectations for his future.]

    The President. Well, before this last round of discussion on 
agriculture, I really believed that we had bottomed out in the shrinking 
of the farm sector. That's what I believe. And I believe that because 
even though productivity will doubtless continue to improve in 
agriculture, we have been moving to a system where we could fairly 
compete around the world so that I thought that we would be able to 
essentially continue the structure of family farming that we now have.
    And it's dramatically lower, obviously, than it was a generation 
ago. And that was inevitable because of the increasing productivity of 
agriculture. It's true everywhere. There are not nearly as many people 
in farming anywhere as there used to be. But I really thought we had 
pretty much bottomed out.
    And I think, as you know, there are basically two purposes for all 
these farm programs, if you really look at it. One is to allow us to be 
competitive with people around the world. The other is to try to deal 
with the fact that farming has become more and more capital-intensive. 
And if you want family farmers to farm, you have to have some sys- 

[[Page 948]]

tem which rides them through the tough times. Otherwise, the economics 
will turn all the farms over to big corporations who can finance their 
own tough times.
    I mean, if you basically think about it, that's--in a lot of our 
States where large corporate farms exist, they don't need the support 
programs because the good years overweigh the bad years, and they don't 
have to worry about the bank loans.
    Now, one of the things that we have ignored in this whole system is 
that the barriers to entry have gotten higher and higher. So most of the 
young farmers that are in farming today are people that got their farms 
from their parents because the barriers to entry are so high.
    And what I was hoping would happen is that, even though we might 
have to cut the support program some more, that we would have no backing 
off of agricultural research, no backing off of the development of 
alternative agricultural endeavors in this country like the ethanol 
program, and that we might be able to develop some sort of first-time 
farmer financing system that would help to lower the barriers to entry. 
Because I think we are in a position now just--if you project--if you 
look at world population growth, if you look at the fact that we are 
pretty much now committed to sustaining our own capacity to produce food 
in an environmentally responsible way, it is now--I think that it is 
more likely than not that for the next generation, anyway, we could keep 
the present structure of family farms, that you wouldn't have to see the 
continuing collapse if we could work the economics out on the barriers 
to entry.
    Now, if you have an excessive reduction in the farm support 
programs, one of two things or both will happen. You will either give up 
market share overseas, or you will create such difficulties from year to 
year for family farmers that there will be an increase in concentration 
in ownership.
    So again, I would say to you that the big picture looks better for 
you and for people like you coming forward, because I think that we are 
going to be able to maintain the present level of production and the 
present level of acreage for quite a long while now because of how we're 
positioned in the global economy and what's happened with population 
growth in other parts of the world.
    But I am very concerned that--again, I am all for cutting the 
deficit--the Republicans are now using 7-year numbers, the Congress is. 
Under those 7-year numbers, the budgets that we passed cut the deficit a 
trillion dollars over 7 years. I'm all for that. But I think we have to 
say, why are we doing that? Because we want to take the burden of debt 
off our children, because we want to get interest rates down, because we 
want to be freer of the flows of foreign money. In other words, we want 
to raise incomes and strengthen the economy. That means that the deficit 
reduction has to be pursued in the context of raising the incomes of the 
American people, growing the middle class, shrinking the under class, 
pursuing these goals in a consistent way. That's what I believe.
    So you know what I'd do. What I'd do is have a more moderate 
agricultural cut. And what I would try to do is to preserve the things 
that support family farms, diversify farm income, diversify production 
of different products in America, and try to get some way to ease the 
barrier of entry to first-time farmers. That's what I would do if I 
could design this program for the next 5 years all by myself.
    Senator Baucus. Mr. President, I think we have time for one more 
question before we go have dinner here pretty quickly.
    The President. Yes, all those folks are starving to death and 
getting nothing out of it.

Vocational Education

[Jason Noyes, second vice president for the Montana Future Farmers of 
America, asked about funding for vocational and agricultural education.]

    The President.  I have tried to do two things on the vocational 
education issue, generally. One is, along with all the other education 
programs, to argue that we ought to look at our situation in America as 
having both a budget deficit and an educational deficit. If you look 
at--there's a bigger difference in the incomes of people by virtue of 
how much education they have in this country than ever before, the 
biggest difference ever

[[Page 949]]

since we've been keeping these statistics. And it's because more and 
more people's incomes, not just farmers but other people's incomes--are 
now set in a global economy, which means that you have to address the 
education deficit as well as the budget deficit. And that means that 
there has to be an appropriate level of investment for things that we 
want to produce.
    If you look at vocational training, generally, one of the things 
that I'm proudest of that our administration has done is that we have 
worked very hard to help every State that wanted to participate set up a 
system of moving young people from high schools who don't go to 4-year 
institutions--may go to community colleges or vocational schools but 
don't go to 4-year institutions--into an educational program that would 
also be a vocational program where they would be working and learning at 
the same time.
    And I believe very strongly that we have to abolish what I think is 
an artificial distinction between academic education and vocational 
education. For a long time, people kind of put down vocational 
education. But if you look at it, there's now a lot of evidence that a 
lot of people learn better when they're doing, plus which a lot of these 
vocational programs, including agriculture, now require higher levels of 
knowledge of computers, for example, than a lot of traditional academic 
courses do.
    So I think we have an idea battle we have to fight, which is to 
raise the status of vocational education generally and abolish, just 
erase, the line between what's vocational and academic; and secondly, to 
keep our levels of investment in all kinds of education that we need for 
the future high enough to raise incomes.
    The biggest problem in America today, economic problem, is that more 
than half the people are working harder than they were 15 years ago for 
the same or lower incomes, not just farmers, wage-earning, hourly wage-
earning Americans. That is the biggest problem we've got.
    The American dream requires a growing middle class and a shrinking 
under class, and requires a system--and I think the principal role of 
Government today in the economy should be to help people help 
themselves. And if you've got people who are out there working hard, and 
they're productive, or they're prepared to be, that's what I think we 
ought to be doing.
    The Government--we don't have the money or the independence from 
other countries to do what we did in the Great Depression, just to try 
to create jobs for everybody and do those kind of things. We don't have 
the money or the position in the world economy. But we do have the 
capacity to help our people help themselves. And I think we ought to be 
doing more of it, not less of it. And I think you can do that. If you 
look at what a small percentage of the Federal budget this is, it is 
wrong to say that you cannot do that and drastically reduce this 
deficit, move it into balance.

[Senator Baucus thanked the President and suggested continuing the 
discussion over lunch.]

    The President. I just want to say this one more time. This farm bill 
is not written. And there's two issues. One is, how much we're going to 
cut spending. We're all going to cut spending, I'm telling you. And 
we'll probably wind up cutting it a little more than you want, but I 
hope we're going to cut it substantially less than they want right now. 
But the issue is not only how much are we going to spend but how are we 
going to spend it.
    And Montana is a place where the family farm is alive and well. I 
think that's an important value in America. So I would just implore you, 
through all your organizations, to look at this and give us some 
guidance about how it ought to be spent--how should the support programs 
be structured, how should we maintain the Conservation Reserve, should 
there be an entry-level program for new farmers? These are things that 
are terribly important. It's not just the amount of money; it is how we 
spend it.
    And as I--I'm having a different argument up there in Washington 
now, but the more you cut, the more important it is how you spend what's 
left. It's more important now how we spend what's left. So I want to ask 
everybody here to be active in how this thing is structured, because 
we've got an opportunity, I believe, to preserve the structure of our 
agriculture we've got in America today

[[Page 950]]

and see it grow economically if we don't blow it.
    Thank you.

Note: The President spoke at 12:25 p.m. at the Leslie Auer farm.