TRANSCRIPT OF REMARKS BY ACTING AGRICULTURE SECRETARY CHUCK CONNER TO THE NATIONAL ASSOCIATION OF FARM BROADCASTERS
Kansas City, Missouri - November 14, 2007
SEC. CHUCK CONNER: Thank you. You are very kind with your introduction today, and it's great to get a chance to know you a little bit. I can tell that your listeners love you to death, and next time I'm in Wisconsin I will track you down somewhere I am sure.
Ladies and gentlemen, I will just tell you, I really appreciate the chance to be here today. You know, the Farm Broadcasters are kind of like the Department of Agriculture in that you come here and feel like you're around family. I know all of you feel that way about each other and certainly that's the way that I feel about a lot of you that I've known for many, many years. And I appreciate the chance to be here in front of you in this capacity.
I've been about Farm Broadcasters most of my life, as a young kid growing up on that farm. You know, those fields seemed mighty long in those days, and those tractors seemed to go awfully slow in those days taking two or three rows at a time, and you would go back and forth and back and forth. And I will tell you that Farm Radio was about the only thing that kept your sanity during those days on that farm. The old radio that my dad put on the tractor that I got to run got two stations, WASK out of Lafayette was the Farm Radio in those days. And, fortunately as well, it did get WGN out of Chicago. So I was able to listen to the Cubs' games in the afternoon. So morning was WASK and the afternoon was usually listening to the Cubs. And I would try and keep from falling asleep cultivating that tiny corn. So things change on the farm, folks.
It is great to be here and have a chance to spend some time with you during this, what I'll call, my acting phase of life. This really is an important time in American agriculture, and I want to just tell you that I am very proud to serve in this post until we have a new Secretary of Agriculture. I will tell as well that I am very much looking forward to working with Ed Schafer as the Secretary of Agriculture as he is navigating his way through the Senate, always challenging, Senate confirmation process. Ed's going to be a good Secretary of Agriculture, and I'm anxious for you guys to be able to know him as well, to get to know him in a better way. I think you will come to admire him as we have as well at USDA.
I will tell you, folks, that the new Farm Bill is one of the most important pieces of legislation that Congress will debate this year, and it is critical for the future of American agriculture that we get it right. It is also vitally important that our farmers and other stakeholders understand completely why your Secretary of Agriculture, why the Administration, oppose the Senate Farm Bill. This is not something we do easily.
To put it simply, I believe our farmers and ranchers deserve and need something better. I feel like I have lived and breathed this Farm Bill over the last two and a half years, and there's a lot of focus about all the attention being paid to it right now. Well, we've been at this for two and a half years. I hosted many of our Farm Bill Forums all across the country. Taylor chaired one of those for us, and we had a great time in those forums. We all heard firsthand many of the comments we received from farmers and ranchers on simply how we can do a better job.
So many of you helped in that process as you hosted and helped us moderate and get through and give as many people the opportunity - young, old, rich, poor, no matter what your status you had an opportunity to come and comment on our Farm Bill. And many of you contributed greatly to that effort.
It was farmers, ladies and gentlemen, who told us about our countercyclical program that it often provides the most help in years when they simply don't need it, and in the years when they desperately need it provides perhaps no help at all. It was farmers who told us about the beneficial interest aspect of our loan programs that has led to big payouts in the aftermath of Hurricane Katrina, payouts that didn't have any corresponding losses to the producers.
And it was farmers who told us about the need to do more for a huge segment of our agricultural economy today, and that's fruits and vegetables and other specialty crops and the importance of increasing our presence for that industry. Farmers were frank with us, first because of course they're farmers and they are straight-up people as we know them. But also because they know that if the safety net of the programs that they rely upon is going to survive, not only for their future but the future of the next generation, it has to be a safety net that has strong support for folks outside of American agriculture.
We are fewer and fewer in number. They know you can't maintain public support for programs that fail to target taxpayer dollars to those who truly need the support. The comments we collected from producers were one of our key guideposts in putting together our administration's Farm Bill proposals earlier this year, and I might add that those proposals have now been available for nearly 11 months, a long time. And we looked at other things as well, such as the changes we face in international trade at a time when our exports are more important to the future of our sound farm economy than ever before.
We've put together a set of proposals to make our farm programs operate, we believe more efficiently and certainly more equitably. Our proposal ends subsidies to producers whose income simply puts them in the two percent of the wealthiest Americans, not just rural Americans but all Americans. At the same time, we continue to provide a strong safety net for producers who need it, at the time that they need it. And we do so in a way to better protect our program from challenge, increasing challenge from the international trade community.
We proposed bigger investments and support for programs that are not tied to price or production such as conservation and direct payments, and we proposed bigger investments in renewable energy and expansion of our Nutrition Programs that are so critical for the most vulnerable Americans today.
We propose, ladies and gentlemen, real reform while investing in the priorities of the future. We did so without increasing taxes, and we did so without resorting to silly budget gimmicks. With prices at record levels for so many commodities, and I'm just advised today in fact that because of buying power out of China that soybean contracts have hit new 10-year highs across the board today.
With net farm income set to come in at $28 billion higher than it was last year, we believe now is the right time to make forward-looking decisions for our farm policy. Ladies and gentlemen, we want to preserve the economic times that we have today. We want to preserve those. But to do so does require a different kind of Farm Bill, one that funds the priorities for the future and, yes, in some cases takes away from those who simply don't need assistance.
Despite the call for reform coming from farmers and taxpayers alike, Congress we believe has responded with a business as usual Farm Bill. Farmers we believe have the right to demand more. They also have the right to a bill that is paid for in an honest and straightforward fashion, not with budget gimmicks, certainly not with more tax revenues coming into the U.S. Treasury.
They simply are not getting, we believe, what they deserve from the Senate Farm Bill. Let me just mention a few areas, if you will, where we believe the Senate version of the Farm Bill does fall short. First, it fails to reform the rules of beneficial interest to put an end to what we describe as the "pick your price phenomenon." The Administration's proposal requires producers to give up their beneficial interest in a crop when they lock in their loan payment rate. That solution is fair, fair to taxpayers, fair to the producers, and it would save a billion dollars over 10 years.
Second, the Senate bill fails to go far enough in lowering the adjusted gross income (AGI) cap on participation in our farm programs. And several of you have heard me mention this already this morning. We believe a $200,000 adjusted gross income averaged over three years is a fair limit. This would affect only 38,000 people who are among the wealthiest 2 percent of all Americans, and that of course would generate $1.5 billion in savings.
Finally, the Senate bill increases target prices and loan rates on 80 percent of our program crops. That is a step in the wrong direction. It is on the wrong path. Loan rates should be tied, we believe, to actual market prices for those crops as we propose to do in our Farm Bill. This will ensure that planting decisions are driven by market dynamics, not by government benefits. And ladies and gentlemen, if there's one thing that should be a keystone of 2007 is that we want our producers' planting decisions to be driven by the marketplace, not by government programs.
This will result as well in a $2 billion savings to add to the others I've mentioned. These three changes -- beneficial interest, AGI and loan rates - would help us produce a fiscally responsible and honestly financed Farm Bill. Unfortunately that is not what we have today and that is not the path they are on. The analysis performed by Congress's own budget experts reveals that the Senate Farm Bill contains nearly $22 billion of pure budget gimmicks and another $15 billion of new tax increases. This is simply unacceptable to us.
In the way of gimmicks, I will point out that the Senate increases Food Stamp benefits for the most vulnerable and then takes that increase away five years later in order to save money, ramping it up only to have it ramped back down. What kind of message is that to the most vulnerable Americans? It claims to provide permanent disaster aid, but eliminates that funding too in five years. These programs will then have to either be terminated or as I'm sure most in Congress believe that they will come back later on when people aren't looking and provide another $12 billion on top of what is already a very over-budget Farm Bill to fully fund these types of programs.
The $15 billion in new taxes in effect does ask other industries to pay for farm programs, and that is a monumental task. Not since 1933 have new taxes been sought to pay for a Farm Bill. How do we expect, ladies and gentlemen, to maintain public support for our farm programs if we're asking other industries to bear the cost of program expansions and I might add bear the cost at a time when we are seeing record incomes virtually across the board.
I believe the Senate Farm Bill would erode the support of the American people for our farm programs, and that is unfortunate. I for one do not want to stand by and simply watch this happen. There is still some time to transform the Senate Farm Bill into one that can win the President's support if Senators do adopt real reforms and of course set aside these phony accounting principles that none of us would ever contemplate using in our own business situations. At least I certainly hope you don't. If you do, I have three letters for you - IRS, don't do it, ladies and gentlemen. They've got to set aside this phony accounting, and of course these totally unnecessary tax increases, which suggest that somehow we have a revenue problem in the federal government today. We do not.
We know what can be done because, quite simply, we did it in our Farm Bill proposals. We had priorities, and we reformed to pay for those priorities. We listened to the wisdom conveyed to us by the stakeholders and developed a roadmap to the continued economic strength in our ag economy.
It's time for all of us, we believe, to work together so that our farmers do know what to expect from their government for this coming crop year. And it is time to deliver a good Farm Bill, one that is good for all of agriculture and I might add, good for America as well.
So I thank you again for this opportunity to be with you, old friends. I look forward to working with you, perhaps next time in a different capacity, but I'm looking forward to working with you as well for a long time to come. So thank you all for having me here today.