March 3, 2000

Despite a lack of agreement about how to fix the problem, two prominent agriculture lawmakers told Farm Bureau members that the low prices afflicting producers across the country need to be turned around.

"We have a challenge before us, because clearly the Freedom to Farm bill is not working," said Rep. Charlie Stenholm (D-Tex.), the ranking Democrat on the House Agriculture Committee. Stenholm was joined by Sen. Larry Craig (R-Idaho) during a farm policy workshop at the American Farm Bureau Federation annual meeting in Houston.

Stenholm, a farmer and three-time recipient of the American Farm Bureau Federation’s highest award to members of Congress, said the federal law is flawed because of its lack of "down-side protection." He said when the law was written in 1996, farm commodity prices were high, but with today’s record-low prices, farmers have no protection except for emergency government payments.

Craig, a key member of the Senate Agriculture Committee, said although he too agrees the current system is flawed, the stark reality of an election year means Congress will only have the opportunity to debate the issue over the next nine months.

Craig said passage of any substantive farm policy changes this year is highly unlikely. He urged the audience of farmers and ranchers to "work with me to get the right program going," saying their input is critical to the process. Part of the problem, he said, lies with the makeup of the nation’s economy and the decreasing importance of traditional farm commodities as a gauge of economic health.

Both panelists agreed one path toward a resurgent American agriculture industry is increased international trade.

Stenholm pointed out that over the last 25 years, exports of most major commodities, with the exception of rice, have been flat. "Trade is where the future is at," he said.

But when it comes to competing against heavily subsidized European Union exports, Stenholm and Craig warned against tactics that would force U.S. positions on trading partners—whether those issues deal with subsidies, non-tariff barriers or language on labor and the environment—without conducting open and frank discussions.

"Highly controversial" was the term the lawmakers used to describe pending congressional debate over granting permanent normal trade relations to China and approving China’s World Trade Organization membership. Stenholm and Craig recognized the importance of opening China’s markets to U.S. grown goods, saying the benefits to farmers and ranchers would be too great to ignore.

"They gave up a lot. We can get a lot, and we give up a little," Craig said, referencing last year’s negotiations to allow China to enter the WTO.

Another tool to help soften low price cycles in the farm economy, Stenholm and Craig said, would be more adequate and workable crop insurance. Both lawmakers said the system needs an overhaul. Stenholm urged that a program to insure cost of production garner the most attention.

"The current system is not working too good for too many folks," Stenholm said. "This is probably one of the most important political and economic issues before us."

Consumer education here and abroad about the benefits of biotechnology was ranked as a "must accomplish" goal by the lawmakers.

Craig and Stenholm were critical of the handling of the genetically modified organism issue in Europe. Stenholm cautioned that American abstinence on the issue put farmers and ranchers in an awkward position—a position that he said must be re-examined.