News Conference at National Association of Farm Broadcasters Convention with Acting Agriculture Secretary Chuck Conner
Kansas City, Missouri, November 14, 2007
SEC. CHUCK CONNER: Let me just say, first and foremost, that we are very anxious for the Senate to take action on the Farm Bill, to get this bill to conference, and then to get a good Farm Bill to the President's desk so our producers can understand the rules of the game.
Harvest is wrapping up, particularly in the Midwest, and they should be beginning to make their plans for the 2008 crop and they want to know, and I understand that, and we should do all that we can to get the rules of the game going forward.
Now having said that, I will tell you, and you are aware, that we do feel like, the Senate-passed Farm Bill, the Senate Committee-passed bill has really gotten off on the wrong track, and we came out very, very forcefully against that bill for the sole purpose of getting it back on track again so that we can get this bill done and information out to the producers.
When I say "on the wrong track," let me just say that fundamentally speaking this bill overspends very, very substantially. It meets, we are advised, I guess the rules of Congress's pay-go, but it does so in a very misleading way. We believe there is $37 billion by Congress's own numbers of additional spending in the Senate-passed bill, $37 billion, over the baseline spending from the 2002 bill.
That $37 billion occurs in two ways-- $15 billion of new taxes, first time we've had a tax increase as part of a Farm Bill since 1933, $15 billion in new taxes; and then $22 billion of what I'd describe as some of the most egregious budget gimmicks that I have ever seen in this process -- $22 billion. If you add those up, taxes, budget gimmicks, they have spent $37 billion over the current baseline.
That's unacceptable to us; again just fundamentally speaking it's the wrong direction for a Farm Bill. It makes farm bills extremely difficult to justify out there in farm country, makes it difficult to justify anywhere in the country. And that's not where we want to be. We want to be in a position to absolutely go out there and so, by golly, this is exactly what we need to do in terms of our farmers, and demand support for them. And I believe we can get support from all corners of this country for a good farm bill, but not one that raises taxes on others, certainly not one that totally hides the true cost of the bill.
Now also, I think you guys need to be aware as well that we've pointed out strong concerns with some of the policy side of this. I will mention one in particular, and go through a longer list when I give my more prepared remarks a little bit later. But obviously the key one is for a farm bill that raises taxes and has budget gimmicks associated with it, we look at this on this side and on the other side we see a farm bill that refuses to do anything about the fact that some of the wealthiest people in America today, those with adjusted gross incomes over $200,000, are the recipient of a lot of farm program payments. This is wrong. It's wrong to be taking middle income taxpayer dollars and transferring that in the form of a farm income support payment to the people that are some of the wealthiest people that reside in America today, particularly when you consider that some of those people in that category have really no direct, or in some cases even indirect, ties to the farm at all. And you've seen us and heard us point out the fact that in New York City you just get a lot of farm program payments tracking up and down Park Avenue in New York City.
Look. This is fundamentally wrong. We need to stop making those kinds of payments, save that $1.5 billion, use that $1.5 billion for other priorities that we've identified that I've really gotten no push-back from Congress in terms of the priorities. They support it, our priorities of conservation, energy development, rural development, help for the fruit and vegetable sector. Those are important priorities. Congress has acknowledged those. We've made some reforms like the one I have suggested, then you don't have to resort to silly budget gimmicks, don't have to resort to tax increases to fund those kind of priorities.
We're going to continue to push this. We want to get this bill done, but it's got to be a good Farm Bill. It's got to be a Farm Bill that recognizes that there needs to be some changes in order to fund very, very important priorities for the future in order to sustain what is really incredible economic growth going on in agriculture today. These are great times for American agriculture.
We have to work though to sustain those times into the future, and the only way you're going to do that, we believe, is with a good, reform-minded farm bill that invests in those things that are going to be important to our future economics.
So I'll stop there on the farm bill as well. Let me just mention too, that we were very, very pleased with Congress and the House overwhelmingly approved the Peru Free Trade Agreement last week. They did so by about a 2 to 1 margin in terms of the vote, and that's a strong vote coming out of the House of Representatives, not one we'd seen on a trade bill really for quite some time.
So we're anxious to see that carried through to the Senate to get Peru done, but as well even more importantly to see the schedule established for passage of both Colombia as well as the Panama Free Trade Agreements as well.
Let me just say with regard to Colombia, that two weeks ago Ambassador Sue Schwab and I were down there, took a congressional delegation to Colombia, so that all of us in the congressional delegation could see firsthand the progress being made in Colombia, some great things going on in that country, some important developments in terms of future friendship in that region of the country for the United States of America. And that's very, very strategic for us.
I will say on the ag policy front, on the ag trade front, these trade agreements, Colombia in particular, dovetails so nicely with U.S. interests. These are countries that for the most part produce products that we have to import into this country, and we do so I might add for the most part duty-free for their products coming into our country. But our products going to them, and there's a strong demand for our products down there, do not enjoy duty-free access. These free trade agreements are about leveling the playing field to give our producers what those producers in those countries already have, and that is duty-free access.
I think that is the reason you're seeing the strong, overwhelming support in the House. Again, we hope that we will finish off Peru here, get a schedule to consider Colombia, and then Panama, and see these Latin agreements proceed forward because they are just simply a win/win situation for American agriculture.
So I'll stop there and take questions. Yep?
REPORTER: Mr. Secretary, at the rate I'm going (unclear) Senate farm bill, I'm curious is the Administration support of Mr. McConnell and others play now what we would consider all amendments, have the Administration had any involvement with Congress there? And can you explain why they appear that he's slowing things down right now?
SEC. CONNER: No. I will just tell you, I mean in terms of how they go about considering the amendments, this is something we have stayed out of. We've suggested our policy changes. We've been very, very clear in terms of what we need to have and in terms of changes to the Senate bill in order to consider that a good farm bill. We want to stay focused on that message, how we get there I think is something we need to leave to the Senate leadership. I will tell you, farm bills only happen every five or six years. You can imagine over the course of that period of time a lot of issues and amendments build up during that period, and you couldn't expect to be able to finish a bill in a couple of days when you only do one every five or six years.
So I've seen a lot of those amendments show up; that's always been the case with the six farm bills I've been associated with. You just have no way of having a full and open debate without having a lot of amendments, and I know that's what they're struggling with because they've, frankly, waited too late in the year to get started on this bill. But nevertheless, we're going to work with them and encourage them to get it done, get a good Farm Bill on its way to the President. Yes, sir.
REPORTER: All these plays we've been seeing in the Senate. What are the ramifications if it turns into 2008 while working on this Farm Bill?
SEC. CONNER: Obviously there's some consequences that occur at the end of this calendar year in terms of reverting back to permanent law that we need to avoid. And we need to encourage congressional action prior to January 1 in order to keep us from having to revert back to some of these permanent law provisions which again would be fairly catastrophic if we actually had to implement some of these things. So we remain confident that there's enough time here to get this done.
Having said that, we acknowledge it is getting late. We've got to get busy making changes to deal with the tax equation, to deal with the situation with all the budget gimmickry and as well as the policy reform. So that's something again we're anxious to work with them on, but we need to get moving on that in order to get it done by the end of the year to avoid these consequences of permanent law. Yes?
REPORTER: Mr. Secretary, if you'd tell a little bit about the President's meeting this Friday with the Japanese prime minister. I know that speculation there will be talk about beef. How do we persuade the Japanese and South Koreans for that matter as well without being so heavy-handed? Seems like we've almost come off as demanding a full, immediate compliance with OIE standards. They seem to have the desire to do it step by step. How do we compromise there, or do we?
SEC. CONNER: Let me just say that it's important that we stay focused on the international standards, not only for beef, but it has implications across broader sectors of our ag export situation. These are countries that have agreed to live by the rules, we have agreed to live by the rules set forth by these international standards. Once you start going down the path of saying, well we support international standards but we'll make an exception here, as you can imagine everybody wants an exception at that point, and we end up, just on beef alone, with dozens upon dozens of different export requirements that become virtually impossible to track and keep track of.
Again, this has implications for all the other sectors as well, where sanitary and phytosanitary export requirements are fundamental to our ability to export, and whether it's fresh fruit and vegetables or whether it's chicken or poultry or beef, whatever the case may be, you just can't have what literally can be thousands of different export requirements. That's the purpose of our sanitary and phytosanitary agreements internationally is to have one set of standards by which we've all agreed to trade by – Japan, Korea, China. These are countries that have all agreed to trade by those international standards. Our message simply to them is, Do what you said you were going to do, period.
REPORTER: Mr. Secretary, farm bill contains the country of origin labeling. Is that going to calm some of these fears about food safety, particularly when it comes from a different nation of course, but there seems to be some confidence has been shaken in terms of our food safety.
SEC. CONNER: I don't think we have ever associated country of origin labeling with any kind of safety issues. I just don't see those evidenced out there linking the two in any way. We have historically been opposed to mandatory country of origin labeling, and I will just say we felt the cost that adds to our system, will be extremely difficult for us.
Having said that, we've also been clear that it is the law of the land, and we're going to administer it by next fall according to the law of the land if that's the direction Congress gives us. My understanding from both the House and the Senate bill they have made some changes to mandatory COOL, but do make it more administratively workable for us. This is a very, very difficult law to administer as I don't need – beef would be a good example of this in terms of animals and product going back and forth across our Mexican/Canadian border and at what point is it U.S., at what point is it Mexican, what point is it Canadian? Just tracking this can be an administrative nightmare in effect. They have made some changes in both versions of the bill to improve the administration of it, and certainly it's going to continue to be a very strong challenge for us to keep track of these products as they go forward and move about. But nevertheless, it will be better, and we've said that this remains the law of the land. We will do our best to administer it in a way that is the best for our producers and consumers. That is the commitment I'll make as well. Yes, sir.
REPORTER: Shortly after it was learned the President's advisors advised him to veto the Senate Farm Bill, it was pointed out by Senate (unclear) Chairman Conrad that the President did say he would veto the bill. (unclear). Has the President told you or anyone else that he will veto the bill? And if not, why?
SEC. CONNER: Well, let me just be clear here, and that is first of all this is the process by which a SAP occurs, and having the senior advisors SAP statement of administration policy, having the senior advisors in that Statement of Administration Policy recommend a veto is an extremely strong message. It would be foolhardy on anybody's part to interpret our particular Statement of Administration Policy as not being a very strong message that we've got a problem here.
Now at the end of the day, when a document is delivered to the President and put on his desk, the President and only the President will make a decision on whether or not to sign that particular bill. Obviously we have kept the President well-advised of everything that is going on in the Senate. I can tell you he's deeply disappointed in the direction. The President is not, if you don't believe anything else surely you believe this President is not about raising taxes. That is true across the board. This bill raises taxes. He's been very clear on that on a number of fronts, including this one – do not raise taxes on the American people on American businesses. This bill does that.
So I just cite that as an example. It would be, again, very foolhardy for any member of Congress not to interpret that SAP as a very, very strong statement at this point.
REPORTER: Mr. Secretary, you refer to the underlying Senate bill as being off the track and that the statement of administration policy is to try to get the bill back on the track. In (unclear) days, I haven't seen anything publicly at least from the key player on the Senate side to indicate that they are moving, offering amendments to make the changes that you all are looking for. What is happening that gives you hope or confidence that the bill will be to the Administration's liking, or is a veto a foregone conclusion here?
SEC. CONNER: I don't think a veto is a foregone conclusion, certainly not from our standpoint, and again, Stewart, we believe that a lot of the changes we are suggesting really represent common sense. I appreciate the difficulty that these changes generate, but at the same time too, no matter where you go in the country, when you talk to people out there on the street and suggest the notion that their tax dollars are going to provide a direct income enhancing subsidy to people that are absolutely among the top 2 percent of the wealthiest Americans that exist today – Folks, the reaction is unanimous. They are outraged at that thought. And this is just one of the basic changes that we are suggesting in the Senate bill to start getting it back on the right track, basic change. It should be an easy change.
They all should be suggesting this change. So again I use that as the example. I appreciate all the angst and the high alert and all the controversy that is up there, but at the same time I step back from this and say, we're not asking that much when we're simply saying, don't subsidize the 2 percent of the very, very wealthiest Americans that exist today. That's kind of common sense where I come from.