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Transcript of Remarks by Secretary of Agriculture Ed Schafer at the 2008 Annual Convention of the National Association of Farm Broadcasting
Kansas City, Missouri - Wednesday, November 12, 2008
SEC. ED SCHAFER: Thank you, Randy. Thanks for the introduction. It's great to be with you. It kind of makes me feel like home to be with the Red River Valley Network, so I appreciate that.
I know you have your microphones ready and your questions on top of hand. I'm looking forward to answering them, but first I thought I might as well just get started.
The answer is, No, we don't have the ACRE program – we're going to do so. And I don't know what I'm going to be doing come January 21st. But before we get to the rest of the questions, I thought I'd like to share a few thoughts with you about where we've been over the last eight years and offer a road map of sorts of the major issues of the decisions that lie ahead.
Senator Obama's election has drawn the world's attention because of who he is and because of the very positive things his journey to the White House has brought to our country. But in the coming years what will probably be more relevant to all of us—and certainly to you—is what the President-elect thinks about agriculture, about trade and conservation, about renewable energy and nutrition issues and how his views will translate into public policy.
The past eight years have been a remarkable time for American agriculture. President Bush has ushered in an unprecedented growth in the agriculture economy. And it's my hope that the Obama administration will look at the long line of administration successes in agriculture and find a way to build on them with a bipartisan approach. I have certainly grown to appreciate the positioning, I guess, of the United States Department of Agriculture, USDA, as a nonpolitical department. And I certainly hope that stays that way with the new administration.
The prosperity that we see in agriculture today is driven by strong commodity prices, rising export demand and the rapid growth of the renewable fuel industry in rural America. This year cash farm income is on track to set an all-time record of over $100 billion. And we expect export sales to reach a record $114 billion and generate one-third of all cash receipts for U.S. farms. The new global marketplace has emerged, and it's centered on one billion new middle class consumers in developing countries like Mexico and India and China. They're driving strong demand for grains, but also for our beef and pork, and for chicken, for our dairy and processed food products as well.
And these are markets that America's farmers and ranchers are well-positioned to serve. All they need is fair access and a level playing field with our foreign markets. And that's why President Bush has consistently made expanding free trade one of his highest priorities.
Results from our nation's past efforts in that arena have been impressive. In 1994 when North American Free Trade Agreement created a free trade zone covering the United States, Canada and Mexico our agriculture exports to those countries were about $10 billion a year. Today Canada and Mexico rank as our two largest markets for agriculture goods, and our total exports to them will reach $30 billion this year.
The Central American Dominican Republic Free Trade Agreement has seen a similar success. Since it began to take effect in 2005, our agriculture exports to the member nations have grown rapidly. Our export sales to the five nations that have fully implemented the agreement jumped to $2.3 billion in 2007, a 67 percent increase from their pre-agreement level. And they'll be up another 45 percent this year.
The Bush Administration has also pushed hard to conclude a series of bilateral free trade agreements, including those with Colombia and Korea and Panama. Those are awaiting actions by Congress. The administration has also tried to advance the Doha Round of multilateral trade talks because it is important to all of us in agriculture as we pursue trade in the global economy.
All in all, this administration has negotiated 17 free trade agreements. The trade agreements we now have in place have opened the door for market-share gains by American producers in agriculture and in other sectors as well. And in 11 of the 17 agreements that have been implemented, agriculture product exports have increased by 76 percent—in Costa Rica, in Omar and Peru—that are being implemented. But as I mentioned we've got Colombia, Panama and Korea that need to have Congressional approval. Those three agreements, along with Peru in South America, can mean an increased $3 billion in agriculture exports annually and should be put in place.
The agreements have given our producers the tools to protect those gains against challenges from producers in other nations as well. We've made sure the agreements have the control mechanisms in them.
So the question for the next president is whether we continue to seek wider market opportunities for our producers or pull back. You know, there are a lot of isolationists out there, people who have the mistaken idea that somehow we are sheltered from the global economy. And I read—like you—that in the last election that those anti-trade folks have gained seats in Congress. They are going to work toward moving us backward on our trade agreement, and if they prevail it will be bad for U.S. agriculture.
And 40 percent of the gross domestic product increase last year in this country was driven by trade, and certainly agriculture has the only positive trade balance of any sector in our economy. I think actually the National Association of Manufacturers says that now one piece of appliances, or something like that, has a positive balance of trade, but they're the new kids on the block. Agriculture has been consistent in a positive balance of trade for this country.
I would encourage President Elect Obama to take a hard look at the record of success with agriculture trade—and not tear it down, but build upon it the strength that agriculture can bring to our exports, and in fact to the world.
To deserve the support of all Americans, wherever they live, our safety net of farm programs must make wise and efficient use of taxpayers' dollars. And to withstand challenges for our trading partners, they need to be seen as market-based and not price-distorting. That's why we argued strongly for a meaningful cap on adjusted gross income on overall payment limits and of a new approach on setting marketing loan rates as part of the 2008 Farm Bill.
And our farm policies for the new administration must be seen as fair, both here in the United States for our taxpayers, but also from our trading partners abroad. Continued conservation, rural development, and renewable energy initiatives are all critical to the future of rural America, and they all depend on strong and broad-based public support for farm policy and farm programs.
President Bush has been an outspoken advocate for our conservation efforts throughout his time in office. The 2002 Farm Bill marked an historic increase in funding for conservation programs, and the 2008 Farm Bill as a follow-up was another bold step forward that will boost conservation programs by more than $4 billion over the life of the new bill. The conservation programs we now have in place advance environmental goals by preventing soil erosion, preserving wildlife habitat and improving carbon capture while also allowing users to earn additional revenue from their own land.
This administration has also invested an average of $14 billion a year in Rural Development projects—36 percent higher level of spending in rural areas than when we took office. These investments have created or saved over 2 million jobs and have brought broadband services to 2.7 million homes and businesses in rural areas. This has allowed 60 million people who choose to live and work in rural America to be able to compete in the global marketplace.
We've upgraded health care and emergency response services $50 billion in grants to rural infrastructure efforts, and we committed more than $800 million to new renewable energy and energy-efficiency projects. Yet we know that more investments will be needed to ensure that rural America enjoys the same access to services and economic opportunities as our more densely populated parts of the country.
The rapid growth in demand for renewable fuels has brought new jobs and new possibilities to rural America while also enhancing America's energy security. This industry has made remarkable progress in a short period of time, and yet it's still evolving and still changing. Today there is a broad bipartisan agreement that to meet the nation's future energy needs we must develop new policies, new biomass feedstocks, and new business models that go with them. The new farm bill provides $1 billion to help with that transition.
But this industry will need continued public support to reach its full potential. In all these areas—in conservation, rural development, renewable fuels—the Obama administration will have the chance to consolidate and build upon a record of success over the last eight years. And I would encourage them to do so.
Finally, the continuing challenge in food security must be met at home and abroad. Since 2001 this administration has worked hard to make sure that more of the people eligible for domestic nutrition programs actually enroll and receive benefits. We are proud that the rate of participation has climbed from 54 percent in 2001 to 67 percent in 2006, the last year that we have been able to measure.
On the international front, we face the urgent reality of a world population that will grow by more than 70 million people this year and will continue to do that every year. We have to find a way to feed all these new mouths without using any more land.
For all of us in food and agriculture, this really is the challenge of the 21st century. Our administration has worked to develop long-term solutions to world hunger, and there are many, many different dimensions to this challenge. But we believed in meeting this challenge it will require us to share more than just our surplus commodities.
Now we're proud that the citizens of the United States of Americans provide more than 50 percent of the world's food aid today. But that doesn't solve the problem. We believe we must provide countries with better agriculture methods, with more understanding of the land yield with the production of our crops, with better infrastructure, with improved marketing opportunities, with ways to grow our crops so that we can teach and export our expertise in this country that develops the most abundant and least costly food supply in the world.
And certainly we have to provide more countries with opportunities through biotech crops to boost productivity, to increase yields and to create viable and less import-reliant markets.
Here again it's going to be up to the next president to decide whether we move forward in this arena or leave our past policies behind. President-elect Obama and my successor, whomever that is going to be, will have my sincere good wishes in dealing with these dilemmas. But it is in everyone's best interest that they find the right answers.