Agricultural Act of 2014
Floor Speech
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Madam President, I had a chance to listen to the Senator from Minnesota, and I come to speak on another subject, but I wish to assure her that we will get these two nominees and others across the finish line so the U.S. attorney for Minnesota can go to work, hopefully before we get many more days added to the 800 she has already talked about.
The farm bill process has been very long, very hard, and no doubt frustrating for all who have been involved. Some of us on the Senate agriculture committee have participated in two committee markups and two floor debates for this bill, and that is over a period of two Congresses. I voted for and supported the bill at every one of those junctures.
I believe our country needs a good farm policy, which means, of course, an adequate and yet limited safety net for farmers, because so much about farming is beyond the control of the farmers, and I am not talking just about natural disasters. Without a doubt, our farmers then face real, uncontrollable risks every year. The farm bill provides farmers, then, with a number of programs to mitigate risks.
Agriculture remains a changing industry. Unbelievable technological advancements are taking place right before our eyes. Farmers can now control irrigation equipment and monitor grain bins on the phone from the other side of the world. Agricultural technology is progressing so quickly. Five years from now, when we debate the next farm bill, autonomous tractors may well be doing a considerable amount of the field work in America.
Farm policy has also changed over time. Unfortunately, the majority of farm program benefits have started going to a concentrated number of farmers. The fact is 10 percent of the farmers--and those obviously would be the wealthy farmers--get 70 percent of the benefits from a farm bill. One reason for this is that the current farm policy offers farmers essentially unlimited subsidies if they hire the right lawyers. As a farmer, a citizen, and a legislator, I believe it is wrong to expect or even to allow the government to give unlimited support to my farm or any farm, especially since our country has a record $17 trillion national debt.
During the first full Senate farm debate in the summer of 2012--so the last Congress--my payment limit reforms were adopted by a vote of 75 to 24 here on the floor of this very body. During the first round of floor debate in the House in this Congress, Mr. Fortenberry from Nebraska offered the same reforms and they were adopted there in the House by a vote of 230 to 194. Congress has spoken, then, and overwhelmingly agrees in both bodies with my commonsense approach of limitations on the amount that one farming operation can get.
Wouldn't anyone think that policy, which is widely supported in both bodies of Congress and which saves taxpayers nearly $400 million, would be untouchable when it comes to a conference committee? The rules of this institution, the Senate, outline that. Senate rule XXVIII, if anyone would like to look it up. However, once again, behind closed doors, Washington decided to intentionally screw up common sense.
This conference bill increases the payments available through the countercyclical program--now called price loss coverage or PLC for short--by 150 percent compared to what this Congress had already agreed upon. I have yet to hear anyone tell me a single legitimate reason why that change could be made.
Additionally, the powers that be in this town have proven they learned nothing from the World Trade Organization Brazil cotton case. That dispute has resulted in the United States paying a $143 million fine per year to Brazilian cotton farmers because our farm program for cotton does not meet the rules of international trade. This farm bill doubles down on the same market distorting principles that brought us that very same trade dispute.
The original payment limit reforms that this Congress approved also eliminated abuses through what is commonly know as the "actively engaged loophole.'' To sum up this loophole, it makes it very easy for nonfarmers to get farm subsidies--probably those who go to the extent to hire a lawyer. This results in the largest 10 percent of the farms then, as I said before, getting 70 percent of the farm program's benefits, as I have already mentioned.
Yet the conference committee, in another brazen act of manipulation, eliminates my simple enforceable reform. I happen to think that one nonfarming manager per entity is more than generous and over the years it has been much violated. So we just simply say it ought to be one nonfarm manager per farm and no more. But it has been a lot worse, and my language--the language accepted by this body--reformed that. But as I have indicated a couple times, the conference committee took it out.
The language in the bill now says--instead of the way it passed the Senate and passed the House on the floor of the House--USDA will have the opportunity to review and fix the actively engaged loophole but only if they should choose so; in other words, the Secretary of Agriculture does not have to.
I happen to know that Secretary Vilsack is sympathetic to what I have been trying to accomplish, so maybe he will be able to make something good out of what I think is a very bad provision in this bill that might actually make it very difficult for him to do that.
Under this provision, USDA could have fixed this problem--or even under existing law, I should say--USDA could have fixed this problem at any point, since it is the result of their rulemaking. So giving, as the compromise does, the USDA power they already have and claiming reform happens to be a true--and true too often--example of a Washington hat trick.
The conferees did not stop at just kicking the decision over to the Department, they also tied the USDA's hands with unnecessary requirements that must be met before action can even be taken. That is why I say it is going to be difficult for Secretary Vilsack. I hope he can find ways to accomplish what I want to accomplish. As I said, I think that is where his heart is.
So I hope Secretary Vilsack, and I can even say the Obama administration, finally uses this authority to produce a strong, enforceable rule regarding the number of people who can be eligible for farm subsidies from taxpayers; in other words, people who are actually farming. I am certainly going to offer them my thoughts on this issue.
Maybe I should explain why I said even the Obama administration, beyond Secretary Vilsack. Because in this President's budget more than once and in the Bush budget more than once, Presidents--including this President--have suggested these reforms to save money. This year I said about $400 million. Actually, according to CBO, it is $387 million.
The Government Accountability Office released a report in October of 2013 that clearly outlines the problems with the actively engaged loophole. One farming partnership they highlighted was composed of 22 LLCs, with 20 different owners and 16 managers who got their eligibility through the actively engaged loophole.
So you understand why the bill that passed the Senate and the House said one manager. At least four of the managers I have referred to from that operation even live out of the State, while several others live in cities around the State well outside of commuting distance.
Additionally, just yesterday, it was reported that a large farming operation in the State of Illinois is being fined $5.3 million because they were exploiting taxpayers for farm subsidies. In this case, the government determined their business structure was intentionally designed to evade those payment limitations that are even in existing law with the exact fake entity structures my provisions would have nearly eliminated.
I wish to quote U.S. attorney Jim Lewis, who handled that case:
We are pleased with this favorable resolution of the government's claims of misuse of farm subsidy programs. These programs are designed to help farmers withstand market price volatility and the intrinsic risks associated with farming from year to year. Any attempt to exploit the system to take more than one's fair share is an improper use of government funds that erodes the public confidence in such programs and threatens their continued viability.
End of comment of U.S. Attorney Jim Lewis, who won that case against these farmers, and they will be fined that $5.3 million.
I wish that U.S. attorney could have been part of the farm bill conference committee. His logic and expertise would have helped.
If a farm's business model depends on lawyers setting up complicated Mickey Mouse legal structures just to get more government subsidies, perhaps the owners of that entity are in the wrong business.
So my provisions would have limited subsidies going to a few thousand people who are very well off and, quite frankly, do not need unlimited farm payments from the government--and probably are not even involved with dirt under their fingernails--especially since, by definition, they would be people then who do not actually work on farms.
If we cannot cut subsidies that go to nonfarming millionaires, how will we ever find the courage then to fix other great entitlement problems we have in this country?
With all that said, there are a few things this bill does that are good.
The dairy provisions have ended up more market oriented than where we started, which I believe is very good. I am glad the Crop Insurance Program will remain strong for farmers across the country, and the nutrition program reforms are welcomed.
In the end, I have to make a judgment of the bill as a whole. Every Member of this Senate has to. I believe this bill, sadly, is a missed opportunity. The Congressional Budget Office says the final savings in this bill are only $16.6 billion. That is a pretty small amount compared to the fact that it will spend nearly $1 trillion.
I think my colleagues know I am a person who plays by the rules. So I played by the rules with these reforms that were adopted 2 years ago 75 to 24--not debated or voted on this year because they were part of the bill that passed the Senate and then went to the House of Representatives and were voted on there 230 to 194.
So we played by the rules. A majority of both bodies support these reforms. Yet, in the end, just a small group of people, with a single-minded intent to keep unlimited farm subsidies flowing out the door, proved that Congress deserves its 12-percent approval rating.
I want to be clear. I strongly support the business of agriculture. I have been involved in farming my whole life. My son Robin operates our family farm. I understand the industry. Growing wholesome foods to feed the world has always been one of the noblest occupations, in my opinion.
But if I were to vote yes on the bill, it would be an endorsement of the egregious manipulation of my payment limitation reforms behind closed doors. I cannot in good conscience do that. Therefore, I will oppose the Agricultural Act of 2014.
Just to kind of clarify, do you understand. I hope everybody understands we had the moral authority of a majority of the Senate, the moral authority of a majority of the House of Representatives, the moral authority of a majority of the people of this country--who I believe would say it is a good thing to save $387 million--and yet that moral authority was avoided by conferees who thought: To heck with the majority of the Senate or a voting majority of the House of Representatives of 230 to 194. It does not mean anything. We can do whatever we want to do. We can waste that $387 million. We can continue to give farm payments to people who are not farming. We can continue to let 10 percent of the biggest farmers get 70 percent of the benefits of the farm program, which, in the end, then helps subsidize big farmers getting bigger. There is nothing wrong with big farmers getting bigger, but you should not subsidize it. It drives up the price of farmland, it drives up the price of cash rent, so our young farmers cannot get started farming. If you want to preserve the family farm, that is one of the things that is very important.
So I have said my part. I hope I am around 5 years from now so I can try this once again because I do not intend to give up on this process. Five years from now is the next farm bill probably. Maybe there will be opportunities between now and then. I intend to take advantage of those opportunities.
I yield the floor.
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