Iowa Farmers Union Farm Bill Hearing Testimony

STATEMENT OF CHRIS PETERSEN
PRESIDENT, IOWA FARMERS UNION
BEFORE THE U.S. SENATE AGRICULTURE COMMITTEE
2002 FARM BILL

July 24, 2006 - Ankeny, Iowa

(Continued from previous posts – third in a series of three)…Not only should the future farm bill contain an energy title to build upon the progress already made in the renewable fuels arena, but it should also promote exploration of the unlimited potential that exists in alternative sources available to rural areas such as wind and solar energy, with localized ownership participation a must for rural economic benefit. Harnessing these renewable energy resources and mandating their increased usage is a step in the right direction of changing the paradigm of our current petroleum-dependent society.

Many rural parts of our country have struggled and continue to struggle due to devastating weather-related disasters. Some weather-related disasters are not dramatic enough to make headlines, but typically cause as much damage, if not more, than the disasters that do make the nightly news. Just because it is not in the news, doesn’t mean that devastation caused by multi-year droughts do not have a profound negative impact on rural communities and producers. Instead of making producers and their bankers rely upon the political winds in Washington for disaster relief, it makes more sense to include a permanent disaster program in the next farm bill that mitigates losses not covered by traditional crop insurance or other programs administered by USDA.

I encourage the committee to take a look at the big picture and historical data to quantify the huge negative economic impact non-competitive markets and devaluation of our commodities have on rural America’s economy. Government farm payments do not, and should not, make up for the loss of our markets -- forcing producers to depend on their mailbox as opposed to the marketplace for their living. I had to stop selling hogs to the packers, and quit selling feeder pigs to my neighbors because they had to sell out because the hog market was completely consolidated and fair markets compromised after 1998 price collapse. This is all evidence it’s time we implement a rural community revitalization program that fosters rural entrepreneurship and small businesses development to localize food production and consumption, which gives farmers more positive economic options.

A part of the competition question also involves trade and trade policy. What happens to my market price when our trade surplus turns into a trade deficit? How do I know if my competitors from importing countries are required to meet the same strict environmental and labor standards? Our current free trade agenda does nothing to level the playing field or provide opportunities for me to make a profit from the market. Trade is a good thing,

but will not work in the long run if fairness issues are not addressed during negotiations. Where are the World Trade Organization talks headed? I believe there is a lot of merit in extending the current farm bill until we see what direction trade talks take and what final agreements are hammered out.

As a country, we need to deal with a mounting federal budget deficit. USDA Secretary Mike Johanns says agriculture cannot be excluded from pitching in. I agree that the federal government needs to stop bleeding red ink, but who decided that rural America and farmers and ranchers have to jeopardize their futures to pay for a mess we did not create? I am upset that Congress cut $3 billion dollars from farm programs, which is 9 percent of all the cuts enacted, yet agricultural spending is less than 1 percent of all federal spending.

I hope some of my suggestions have been helpful or at least simulated some thought. Thank you for this opportunity to testify; I would be happy to answer any questions you might have.

post a question or comment here or contact John Crabtree, johnc@cfra.org

Center for Rural Affairs
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