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Mr. JOHANNS. Mr. President, I come to the floor today to discuss the farm bill that is now before the Senate. I want to say at the outset that this is a reform-minded bill that saves money and continues the evolution of farm policy in our Nation.
I commend the chair and ranking member of the Agriculture Committee for working to craft a farm bill that helps equip producers with improved risk management tools while being mindful of our very challenging budget situation.
This bipartisan bill will reduce the deficit by $23.6 billion because of changes to every title and the elimination of nearly 100 Federal programs overall. It shifts farm policy further away from dependence on income support and, instead, focuses on risk management.
But to truly appreciate where we are in farm policy today, it is important to spend a minute examining how we got here.
In the 1930s, depression and disaster ravaged our country's farm sector. At the time a quarter of this country's population lived and worked on farms and ranches, and most of what they produced was consumed relatively close to where it was grown.
When prices collapsed and dust storms swept the Plains, many were forced off their land to look for work in the cities. But oftentimes no work was to be found.
In response to this situation, Congress passed the first farm bill. It was called the Agricultural Adjustment Act of 1933. The act placed the Federal Government in the driver's seat in making farm production decisions. A structure to eliminate crop and livestock surpluses was established--the thought being, if that was done, it would drive up prices. Literally, crops were plowed under and livestock was slaughtered to reduce supply and then, hopefully, to increase farm prices, according to the thinking at the time.
The Agricultural Adjustment Act of 1938 made federally funded price supports mandatory for several crops. That would include corn, cotton, and wheat.
Then another law was passed in 1949. It mandated extensive government intervention to maintain parity with prices prior to World War I.
I am not going to start an argument today about whether all of this was the right farm policy during the 1930s and 1940s. I will leave that for another time. But I can say, with no hesitation whatsoever, it is absolutely the wrong approach for the farm economy today and virtually no one disagrees with that.
Over the past several decades, farm bills have improved from those early laws, and U.S. farm policy has slowly but surely become a more market-oriented policy. For a long time the main goal was to support prices for a list of crops. We set high prices in law which distorted markets and discouraged cultivation of crops that did not benefit from price supports.
In 1996, Congress began to shift away from the distorting farm policies of the past, and direct payments were introduced to temporarily support farmers as they transitioned away from an agricultural economy that was very reliant upon government intervention.
Removing the government from price and supply controls created new risks to farmers, and it created uncertainty from Mother Nature. Congress then responded with ad hoc disaster spending to help farmers and ranchers address losses due to weather and other disasters. In fact, since 1996, USDA's Economic Research Service estimates that $43 billion has been spent on these ad hoc and emergency programs.
To help manage these risks in a more fiscally responsible way, a crop insurance program has emerged. This highly effective public-private partnership helps farmers customize protection for their individual operations. Over time, crop insurance has become the risk management tool for farmers.
These are policies sold by private companies for over 100 different crops, and roughly 85 percent of acreage for major crops is now covered by crop insurance.
Last year, in spite of the drought in much of the southern plains and flooding in States such as Nebraska and many other States, farmers and ranchers did not call for emergency relief. In fact, I have heard clearly from farmers in Nebraska that crop insurance is working well.
Today's farmers are certainly some of the most sophisticated and talented businesspeople in our Nation. The fruits of their labor produce an abundance of healthy low-cost food for Americans and, for that matter, people around the world. In fact, trade currently accounts for more than 25 percent of all U.S. farm receipts, and 1 out of every 3 crop acres--1 out of 3--is now exported.
In 2011 agricultural exports reached $136 billion. Our efficient export system, including handling, processing, and distribution of our food and agricultural products, creates millions of U.S. jobs. Given the projected global population growth of an additional 2.5 billion people by 2050, U.S. agriculture is positioned to experience significant growth in just a few years.
This farm bill ensures that USDA is focused on maintaining current export markets and gaining access to new emerging markets for U.S. farm and food products. This is the first farm bill in recent history that does not pay farmers a specific payment just because they are farmers. You see, farmers have come to realize that risk management is best handled with crop insurance. In fact, in many listening sessions I have had around the State, virtually no one asked for the continuation of direct payments.
The bill actually saves $15 billion from commodity crop support by eliminating four programs, including direct payments; countercyclical payments; the Average Crop Revenue Election Program, called ACRE; and the Supplemental Revenue Assistance Program, called SURE.
It does not raise loan rates, the price levels that have traditionally triggered the making of payments. It focuses the farm program on revenue, not price--something I proposed as the U.S. Secretary of Agriculture when I served in the Cabinet.
I remind my colleagues that our job in writing a farm bill is not to protect the interests of specific commodity groups. Instead, the farm bill should be about
preserving the health of our agricultural economy. This farm bill continues a history of steps in that direction.
It seeks to minimize distortions and allows farmers to respond to market incentives--not determined by artificial prices set in a Federal statute.
I am also glad to see a step forward on payment limits and changes to ensure that those who receive government payments are actively engaged in farming.
I am especially pleased with the efforts to streamline and simplify the conservation programs. That is an issue I have heard a lot about. This bill actually consolidates 23 conservation programs into 13. In fact, I proposed similar changes as Agriculture Secretary during the last farm bill process. The improvements reduce costs as well as make the programs more farmer friendly.
This bill also provides for the basic research at USDA, universities, and elsewhere that is needed to meet the demand for our farmers to produce more food, and on less land, and it does so in a way that includes new avenues to ensure that important work continues in these times of very tight Federal budgets.
Finally, I am pleased this bill builds on efforts to encourage beginning farmers and ranchers, veterans, and others looking for careers in agriculture.
It is important to me that we keep this farm bill as simple and streamlined as possible. I think we can agree that a bill that eliminates nearly 100 Federal programs does just that.
Given our Nation's daunting budget situation, it is appropriate that this bill saves $23.6 billion, taking yet another step in the right direction to reforming farm policy for the 21st century.
I hope we can keep this bill moving to help ensure certainty for farmers, ranchers, and others in rural communities where livelihoods are impacted by these policies. But make no mistake, good farm policy does not end with a good farm bill. Our farmers and ranchers also deserve a more constructive regulatory environment and a fairer tax system. So while I support the bill, I hope we can get some amendments pending to make a good bill a better bill.
This is so important that I led a letter with 43 other Senators asking for an open amendment process. I look forward to the debate and to passing a very reform-minded farm bill.
Mr. President, I yield the floor and suggest the absence of a quorum.
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