Opening Statement of Chairman Frank D. Lucas Committee on Agriculture Public Hearing to Review the State of the Rural Economy

Mar 5, 2013

Tamara Hinton, 202.225.0184

Thank you Mr. Secretary for appearing before the Committee today.

I am pleased the President asked you to continue in your role as Secretary. While we may not always agree on every topic, you have never been disagreeable and you are a good friend to American agriculture. I appreciate your hard work to quickly implement the extension of the 2008 Farm Bill and announce the sign-up for farm programs, which gave producers some certainty during a time when certainty is sorely lacking. All of us can agree that an extension was not our preference, but I want to personally thank you for announcing the signup so quickly.

This country continues to face a fiscal crisis that, if not addressed, will not only harm the agricultural sector and rural America, but the country as a whole. The agriculture sector wants to be part of the solution to our nation’s debt crisis. We must find common-sense solutions without trying to scare the American people with worst-case scenarios. I have confidence in you, Mr. Secretary, to manage sequestration without a mass disruption to the rural economy.

The Committee believes the best way to achieve deficit reduction is in the context of reauthorizing the farm bill with sustainable and fiscally responsible reforms. This Committee and this Congress must pass a comprehensive, five-year farm bill this year. The reforms in the House bill are too great, the savings to the taxpayer are too important, and the benefits to our farmers and ranchers are too critical to not complete the process this year.

Few in the agriculture sector will deny that the agriculture economy has done well overall in the last few years. But that well-being has not been distributed evenly across the entire sector, and if history is any guide, we know how fleeting the good times are.

For example, livestock producers have suffered through multiple years of drought and are operating with no safety net in place. Livestock disaster programs no longer function because the 2008 Farm Bill only provided four years of funding for these important programs. Additionally, record high prices for some crops have hurt the livestock industry tremendously. I am not here to place blame, but we have to acknowledge that fact.

Crop producers in my part of the country and elsewhere are dealing with a third straight year of drought. Also, rice, peanut, sugar, dairy and cotton producers have not enjoyed consistent, record high prices that our friends in the Midwest have, so I think we must be careful to paint a rosy picture with a broad brush. While income is up, so is the cost of doing business. Inputs continue to rise, as do rental rates. The fact is - farming and ranching have been and will continue to be a tremendously risky business.

As we all know, agriculture is highly cyclical and the agriculture community must be prepared for bad yields, bad prices, and much lower net farm income in the future. We must be very careful in ensuring that we replace direct payments with policy that works for all commodities in all regions of the country. We must acknowledge that crop insurance is the backbone of the safety net, but we must also recognize its limitations in protecting against multi-year price declines. The Committee firmly believes in providing a true safety net, rather than providing payments regardless of market conditions.

Mr. Secretary, I was interested in your comments earlier this year about the agriculture community’s loss of influence. The truth is the United States is less rural. The Congress reflects that reality and we must adapt.

Making the case for production agriculture and rural America is the challenge before us. And, we face an uncertain future if the agriculture community is divided.

Commodity groups must not tear each other down with the ultimate goal of seeing who gets the biggest piece of the pie. Conservation groups and so called sustainable groups must realize that for farmers to implement additional conservation practices, they must have the resources to do so. Quite simply, the agriculture community must accept that no bill is perfect, but that should not serve as discouragement. Instead, we must have a rural coalition pushing forward to get a bill passed and signed into law.

Mr. Secretary, without hesitation, I know you are a great friend of agriculture and rural America, but I am disappointed to see the administration’s comments on meat inspection. You have stated that the sequester provisions in the Budget Control Act will cause you to furlough Food Safety Inspection Service inspectors. Members of this Committee have heard from constituents that these statements about the interruption of production have affected prices, caused concern among financial markets, and alarmed buyers and sellers in the retail and food service community. I anticipate that my colleagues will have questions for you regarding your statements and the evolution of administration policy in this critical area.

Further, it was disappointing to see the administration favored the Reid-Stabenow proposal to replace the sequester. Fortunately, the Senate failed to pass that proposal, which unfairly targeted agriculture. They proposed a 50 percent cut to a single title in the farm bill that accounts for six percent of overall agriculture spending and less than one percent of overall federal spending. It was not balanced and not acceptable. I believe the best way to achieve deficit reduction, as it relates to agriculture, is in the context of reauthorizing the farm bill with sustainable and fiscally responsible reforms such as those the Committee passed last year.

Mr. Secretary, again thank you for being with us today. I look forward to your testimony.