SEC. MIKE JOHANNS: Thank you very much. Well, thank you. That was a very nice introduction and a very nice welcome. I appreciate that warm welcome.

You've probably heard this story. I had just been elected the governor of Nebraska some years ago, and I was in that period of time between getting elected and getting sworn in, and I was invited to go out to Kearney, Nebraska and give a speech. So my wife Stephanie and I drove out there, and same sort of thing -- nice introduction, and as I'm making my way to the podium everybody stood up and applauded. So I got to the podium and I said, "You know, that's really very nice of you but I haven't done anything yet. And somebody in back yelled out, "And when you do, we won't be standing!" So.

[Laughter.]

It's reassuring to me somewhat that after doing the job for nearly two years I still get a warm welcome. I appreciate it immensely.

I often like to start my comments by telling a story or two, and you know today we're dealing with a topic that certainly has controversy attached to it and a lot of discussion and a lot of debate and agreement and disagreement. So I think I've come up with the perfect story to start.

I'll start out and acknowledge that I borrowed this story from a former congressman in Nebraska, a guy by the name of Bill Barrett. He represented the big Third District of Nebraska, which is cattle country and very wide-open spaces. And he'd only been a congressman a short period of time; I think he was in his first term and running for reelection. He was out there campaigning, and he's at this event and there's these guys kind of sitting in a row like this. And he's just going down the row and shaking hands with people.

And so he gets to this one guy and says, "I'm Bill Barrett, I'm running for Congress, and I'd certainly appreciate your support."

And the guy said, "You've got it."

Bill said, "Well my goodness, that's pretty easy." So he was making his way down to a few more people and he hears a conversation back between the guy who had just offered his support and somebody sitting next to him. The somebody sitting nest to this guy said, Why did you do that, why did you offer your support so quick? The guy who had offered his support said, "Anybody would be better than that damned fool we have now!"

So.

[Laughter]

So maybe that's an appropriate way to start my comments today.

Well, thanks for the opportunity to be here. My thanks to the sponsors and to the exhibitors and to the Planning Committee for the National Institute for Animal Agriculture for coordination that's gone into making this event so successful. And look at the room-- virtually every chair is filled. So obviously this is going to be a successful event.

What I'm going to do today is, as informally as you possibly can standing in front of a podium with people sitting in front of you, I'm going to offer some thoughts. But then what I would like to do is encourage you to pass your questions down. Any question you have I'd love to answer.

Mention was made that I'll do a press conference right after this, and I will. So if you're with the media, I would ask you to maybe hold your question until that event, and I'll try to get through all the media's questions also.

I have sitting in front of me here Dr. John Clifford, who has worked on the Animal ID issue a lot. So if your questions get really technical, John, you get ready, because I'm going to bring you up here and you can help me answer some of those questions.

I look out today and I see a wonderful turn-out. I'm absolutely pleased with the representation that's here today. Producers, and State Departments of Agriculture, health officials, commodity organizations, technology companies, folks all areas, and I could go on and on.

I was talking to my wife this morning, Stephanie. Those of you who re from Nebraska, and I see Greg is here, Greg Ibach, director of Agriculture in Nebraska -- they know Stephanie because I was the governor there and they got to know her as one who would keep me pretty humble. So I called Stephanie this morning, and I said, "You know Steph, this is really an important speech, and I'm trying to figure out how to approach it, and any advice you can give would really be appreciated." And she said, "Well, whatever you do, Mike, don't sound too intellectual, and don't sound too sophisticated, don't try to be charming." She said, "Just be yourself."

[Laughter]

So I'm going to try to do that.

Well, in all seriousness I'm here first and foremost to tip my hat to you. You have been a key part or really an incredibly complex, phenomenal effort to coordinate, collaborate, educate and to move forward with National Animal Identification System.

If, as I walked up on the stage today, someone would have said to me, You only get one message today, my message would be to say, Thanks. You know, we're in the very, very early stages of this system. Mention was made that our experience is much like what other countries have gone through, and I think that's true. I think there's a lot of questions, and we're working through those questions. There's concerns raised, and we're trying to do everything we can to address those concerns.

It seems like every day somebody has a new idea about what this should be or shouldn't be, and so there's a lot of debate out in the country, and there's a lot of debate amongst the folks that are involved in this business, and we're very, very mindful of that.

We do have some out there who say, we just don't want to do this. But by and large the industry says, we recognize the need to do it. And I agree with that assessment. This is no small task. We can look at other countries as a model for what's been done. You know, we've got Canada up there to our north, we've got Australia out there, and these are two pretty good competitors of ours in the beef industry and in other industries as well. And they've kind of worked down through this path, if you will.

But compare the size of their herds to ours, and you begin to realize that we are biting off a big, big issue. And there would be no sensible reason for me to get up in front of you today and try to minimize that. This is very significant.

But I am very pleased by the progress that has been made. And let me be clear that we are here today because of that progress.

I want to just offer some advice. Don't let those who are the nay-sayers dampen your enthusiasm or diminish the strides. Don't let them convince you that we should minimize what you have accomplished. I started in this animal ID area some years ago. Greg was the Deputy Secretary of Agriculture, director of Agriculture in Nebraska at the time. They'd done a trade mission to Japan, and as I said this was some years ago; I was still the governor.

And what we would do on our trade missions, ladies and gentlemen, we would take with us agricultural industries that were interested in boosting their trade in that given area. We would encourage the Farm Bureau to go with us, we would encourage the corn producers to go with us, we would encourage the cattlemen to go with us, and on and on.

And they were tremendous supporters in this effort. So really without fail we'd always have a big trade mission, a lot of people.

Well we went over to Japan, and we talked to them about selling beef into that area. And you know what? I came back absolutely convinced that I needed to do everything I could to try to provide the leadership to move our state forward in terms of animal identification. I became absolutely convinced of it.

And so we were one of the first states in the country to actually put together a conference on animal ID. I compare where we were at at that point in time, just a few years ago, with where you are at today, and I am encouraged by the progress.

You know, if you think about it, if you just tick down through the things that have occurred-- for starters I'm pleased to report to you probably something you know well, and that is that all 50 states, five tribes and two territories, are participating in the premises registration. We have 300,000 premises registered.

States and organizations are just doing a great job of getting this underway, not without some challenges; I will be the first to acknowledge that. But again it seems to me, as those issues have arisen we've been able to sit down with those states or tribes or whatever and work through those issues.

We're also approving private and state animal tracking databases. Thus far we have evaluated five of about 20 applications for animal tracking databases. One cooperative agreement has been signed, and I can assure you that more will be on the way in the near future.

What's reassuring about that to me is that this is the effort that in the large part, and a major part is driven by the private sector, and the private sector has stepped forward. And USDA has now approved four ID tags that can be purchased from two companies. We've certified that the tagging system of these firms are capable of identifying livestock with the unique lifetime ID number established as a national standard through the program.

So to all representatives of identification device manufacturers who are here with us today, I encourage you to submit your application for evaluation of your product. We're anxious to work with you.

I still firmly believe that competition and choice are good. After all, that's what our country was built upon. And we're eager to approve additional tag options. We want to encourage that competition. You see, when you put it all together you realize that we have in fact made considerable progress. In fact if I compare it to that first conference we had back in the state of Nebraska after that trade mission, I can tell you that we've moved light years.

It may not feel like that, but I can tell you where we started then not having any idea whether there was technology out there, not having any idea whether the technology was ready to move into this area, not having any idea of where this was headed-- we have moved light years. This progress simply would not have happened but for the support of producers and industry, states and other stakeholders.

But now we must redouble our efforts to take animal ID to the next level. I can promise you this: animal ID is going to remain one of my top priorities in the couple of years that I have left as Secretary of Agriculture. That means pressing forward with determination to achieve the goals that we have established. That means paying attention to the feedback we are receiving, which we have done and we are going to continue to do.

And that means educating and answering questions that pop up to address concerns and to do all I can to explain the benefits of this system. In fact I'd like to take just a moment or two, if I could, and spend a few sentences on that.

Some concerns have been expressed about various aspects of the system, and I would just simply like to confront those. For example, some people worry about the cost of the system, and we understand that. And many industries where we talk about animal ID, margins are oftentimes very, very tight; cost is a very relevant consideration.

Others have questioned whether it will be effective, whether it's just too bureaucratic. Some are concerned about the confidentiality of data that would be included in the system.

I'm here today to say that we're listening to those concerns. The adjustments we've made along the way I hope you view as evidence that we are listening, and we will continue to fine-tune the system based upon what you're telling us, based upon what you're seeing out there in the field.

Now just a couple moments ago I encouraged ID manufacturers to submit applications recognizing the value of ensuring that our producers had numerous choices. USDA is ready, willing and eager to review all applications, to review all technologies. Part of our goal in allowing for a competitive environment is to do all we can to keep costs down. We believe that competition is the best way of doing that.

A competitive system includes price competition, and we hope it means a better deal for our producers. By opening the door to the private sector involvement, I believe we are addressing another concern that we've heard a time or two about the system becoming bureaucratic. You know ladies and gentlemen, let me just be real straight with you. Perhaps there was a time when that concern gained traction based on the notion of one massive system somewhere in the bowels of the USDA that would contain all of your private data, this notion that this massive system would be entirely run by the federal government, this notion that it was going to be the Washington way or the high way.

And you see what? I don't believe in that. I believe that the best system is going to be driven at the ground level by you, by producers, by those who are involved in it. You see, today we have strong private sector involvement that is building this plan, and it's a voluntary system. So it must meet the needs of the producers in order to encourage them to be involved and to garner their support.

But that's the kind of system I fundamentally believe is best for these industries. From the time I held that first conference on animal ID back when I was governor of Nebraska, I had two very clear opinions that the best approach would be a voluntary system and that this system should be driven by the private sector.

I firmly believed then, and now nearly two years into this job as Secretary of Agriculture I continue to believe today, that the best innovation, the best price competition, the best opportunity for producers is the voluntary system.

We'll be issuing a comprehensive document within the next few months that lays out exactly what animal ID is and what it is not that will help to answer questions about how the program will work. We've already published a guide for noncommercial producers that addresses their questions, and we're also conducting a grassroots outreach campaign to correct misinformation, encourage participation and make sure producers understand the value of animal ID.

Please forgive me but let me take a moment if I could to brag on a state that I'm very, very familiar with. And Greg, I don't mean to embarrass you but I'm going to brag a little bit about Nebraska. I stopped at their booth today, and one of the things that they are in the process of developing is a public information campaign to get good information out there to producers as to the whys and why-fors, why this system makes sense. I could not applaud that effort more.

We are going to be doing that at the national level, but I encourage you to do that also at the state level. Getting information out there as to what this system is and what it is not I believe is absolutely critical to lead to an understanding.

I've been asked why we've been putting so much effort into the animal ID system. At its core, the system is a critical tool in safeguarding the health of agricultural animals from disease. When it comes to an outbreak, time is money. What if three or four years from now, you've got a new Secretary of Agriculture and you've got a disease outbreak that is serious? Can you ask that Secretary of Agriculture, where is that animal from? And his or her response is, "You know, I don't know." What if the next question is, "Well where's the animal been? Is there some potential that it's affected my animals?" And that Secretary of Agriculture's response is, "Well I don't know."

How are you going to feel about that, ladies and gentlemen? Aren't you going to be asking the question at that point of time, "Where have we been? Why haven't we moved this forward to deal with these issues?" You don't ever want to put this massive economic system at risk by answers to very, very pertinent questions that are along the lines of, "I don't know."

It is absolutely incumbent that we come to grips with how we move this forward. This ID system will enable health officials to stop the spread of disease and lessen the economic and other social impacts of a disease outbreak.

Now ladies and gentlemen, I pray that disease outbreak never arrives and we never have to put this system to full implementation. But if it does on just one occasion, we will be glad that we fought this battle and did everything we can do to put this system in place. Everyone in this room, every single person in this room understands the consequences of an outbreak. The loss of breeding stock, the labor time, the loss in trade, the economic loss that occurs to our farmers and ranchers. It can be staggering to producers, and it can be staggering to our rural communities.

Quick identification of infected animals means less exposure. It means that we can isolate the issue quickly and deal with it. It means less time and money spent on eradication work. And it may mean the survival of an industry. The faster we can assure consumers and trading partners of the health of our herd during an outbreak, the less economic impact on absolutely everyone, from U.S. taxpayers to commercial and noncommercial producers, to customers and to federal, state regulators.

We can't overlook the importance of having the ability in certain trade situations to define regions that are affected by outbreak. This can translate into protections for large segments of the industry. In this kind of event, a National ID System will give us detailed data to quickly identify the scope of the disease. We'd have the tools we need to reassure our trading partners and help prevent widespread market closures.

You know, if you ever wonder for a moment, can it happen, I'd just call your attention to the beef industry in December 2003. I rest my case.

Speaking of our trading partners, as you look to other parts of the world another reason why a national system is important becomes crystal clear. Other countries like Australia are aggressively marketing their animal traceability, and you know why they are doing it? It's a competitive advantage, and believe me they are fierce, fierce competitors. There's no question that market demands like source and age verification and traceability are gaining in importance literally daily and weekly. In time, demands like these may well become a primary driver as we move toward greater and greater participation in the system.

So I believe that a National Identification System is important. It's absolutely necessary.

But to achieve this there's so much at stake. We must have everyone on board. Our stakeholders must be committed to animal ID for the long term if we are to be successful.

And that brings me to the last concern I outlined a few minutes ago, the concern about producer confidentiality. I'm fully aware of the importance of confidentiality to our producers. So let me address this issue head on.

Reference was made to my ag background, the fact that I grew up on a dairy farm on North Central Iowa. I've spent virtually all my political career working with ag producers. That would be especially true in the years I was governor of a really great ag state, the state of Nebraska. I got to know these producers because I'll tell you in many cases they were great supporters of what I believed in. I also understand very, very well their desire to protect their private information.

And you know what? That desire is right on the mark. It is absolutely right on the mark. You know when I arrived and somebody explained to me this massive system where a government agency was literally going to have possession of data which I know my friends in the ranch industry regard as enormously sensitive private information --

I'll share a story with you. My wife and I were spending a weekend at a ranch in Western Nebraska, beautiful area. My wife, I kid her all the time, is a city girl. She has no idea about agriculture. And so she was visiting with this rancher at breakfast, and she said to him, So how many acres do you have in this spread? He said, You know, ma'am, we just don't talk about those things out here.

You know, that really makes the point. There are certain things that are very private, and I want to respect that and honor that as your Secretary of Agriculture. So it does bring me to the last concern, the concern about that confidentiality.

I could not be more aware of the importance of confidentiality to our producers, and that's why I do want to address this issue head on. First I will tell you that I agree wholeheartedly with the livestock producers who believe that information about your livestock is your business, period. The business of agriculture has undergone significant change in the past few decades. The image of a producer taking his crops and livestock to market is changing. In today's very highly competitive marketplace, a farm or a ranch's operations should remain confidential, they should be protected.

As I said, as someone born and raised on a farm in Iowa and as your Secretary of Agriculture, I do not believe I should be in the business of possessing your information, your personal business information.

That's why I have directed APHIS to create an Animal ID System that will hold information about animal movements in the private sector and in the state databases that chose to go in a state direction. Animal movement information registered in the private animal tracking database is private. It should not be a USDA record. That information cannot be released by USDA because we don't own it, and we don't control it, nor should we.

Only in the event of an animal disease outbreak will USDA go to the holder of that information and explain to them what they need, and the holder of that information will supply it to us. Even then and only then, only that information relative to the disease outbreak will be collected and retained as a part of that investigation.

I also heard you say you trust USDA with your information but you're worried about other federal agencies going on a fishing expedition in the data. Again I want you to know I hear you, but the answer to that question is really straightforward. By law USDA cannot alter its Privacy Act systems of records to other agencies. We can't. We simply can't do it if we wanted to, and I will tell you we don't want to. You've said that you're worried about an activist group will request premise data which would contain names and addresses and other information about your premises. Let me assure you that names and addresses are protected under the Privacy Act, so again that information cannot and would not be released.

As I said, we are finalizing a comprehensive document that lays all this out and brings clarity to these very important questions. As we move forward, we recognize the need to arm all of you with the same answers, to make sure we're on the same page of information.

Let me just wrap up here quickly and then I'd be happy to take your questions.

Ladies and gentlemen, I arrived here today and I tell you without any hesitation that I need you in this effort. It really is as simple as that. There's no doubt in my mind that leadership among state agencies and leadership amongst producer groups is essential. No matter how hard I work, I will never have the personal relationship with producers that your ag Secretary or your ag director or your company has in the communities across this country. So I need you.

So in addition to expressing my gratitude to you for your work, I'm here today to ask you to use this conference as a launching point to become a true leader in moving this forward.

That really is what we need. We need leaders all across this country who have the vision and recognize the value of the system. It may be some hard sledding now. I fully appreciate that. But in the event we ever have to call upon this system to identify where an animal has been, what other animals that animal has had contact with, and where it ended up-- you're going to look enormously wise.

Of course some of you haven't waited for this conference to be standouts in this arena. We're seeing leaders emerge among states and producer groups. We see states really showing true leadership. They are aggressively working to educate producers, and they're doing all they can with public information campaigns or simply making registration as easy as possible.

On the industry side, I continue to be very impressed with the forward thinking and progressive attitude about animal ID amongst our several producer groups. You know I can talk at length about the cattle industry because I know it so well. The pork producers-- you know if you look at what they're doing, they've set a goal to have all swine premises registered by the end of next year. And I think that's terrific. It's the kind of leadership that will bring this to the finish line.

Innovative ideas abound. I walked through the displays today. If you haven't been there, go over there and see what this idea, this vision of a voluntary system driven by the private sector is creating. You have people there, companies there, that literally have systems that they're ready to demonstrate to you. Even if we had wanted to at that conference a few years ago in Nebraska I'm not sure we could have gotten many people there. That's how much this has changed. It is so encouraging to me.

I applaud the vision and the global perspective that you have. I sincerely believe that it's going to be a difference-maker. The day will arrive in all likelihood, God forbid, but it probably will, where this is going to look like one of the wisest choices made in our animal industry ever.

My thanks for having me here today for giving me a chance to visit with you, for working with us to educate producers to get premises registered, and for your cooperation and support of achieving a true landmark for America's livestock industries.

Thank you. God bless each of you.

[Applause.]