Committee Statement

 

The Honorable Frank D. Lucas

Ranking Member, House Committee on Agriculture

 

RE: Subcommittee on General Farm Commodities and Management hearing to review the state of the farm economy

 

April 1, 2009

Thank you chairman Boswell and Ranking Member Moran for holding this hearing to review the state of the farm economy.

And, thank you to our two panels for your time today.

These are difficult and uncertain times for folks all across rural America. I hear of the specific challenges our farmers and ranchers face when I go back home to Oklahoma. But, it is important to take a long and broad look at the challenges our producers, as a whole, are facing all across the country.

We are facing a global economic crisis, which has weakened the farm economy. Commodity prices have dropped significantly over the past six months. Although input prices have fallen a bit as well, it is not enough to compensate for the loss in profits and cash flow for our producers. USDA recently reported that U.S. net farm income is down 20% from last year.

These are serious issues alone. But, adding to the problem is the fact that we have an administration that is intent on eliminating the farm safety net to our producers. This administration doesn’t seem to understand the problems facing our agriculture communities, or how important these communities are to our economy. If this administration did, it wouldn’t try to eliminate direct payments to those producers who make $500,000 in annual sales. Sales. Not profit. This is not only a bad idea, but it’s the wrong policy approach and it is a direct attack on full-time, family-run farmers.

Our farmers and ranchers are some of the hardest working people in the U.S. and they are struggling to make a living in a difficult economy. The people who provide us with the safest, most abundant, most affordable food and fiber supply in the history of the world are being asked to shoulder the burden of our economic crisis.

My concerns about this administration only grow when, despite opposition from house and senate lawmakers and many farm groups, Secretary of Agriculture Tom Vilsack and the Director of the Office of Management and Budget, Peter Orszag both say they believe there will be a way to reduce farm supports.

This administration doesn’t understand that farm supports, especially in the form of direct payments, allow farmers to show bankers and farm credit that they have the income to repay their loans. This administration doesn’t understand that direct payments provide producers with the flexibility to respond to market signals when choosing crops. And, most importantly, this administration doesn’t understand that direct payments are a commitment we made to our producers when we passed, with bipartisan support, the 2008 farm bill.

I would like to thank Chairman Peterson for continuing to support the 2008 farm bill that he and many of us worked hard to secure.

I look forward to the testimony from our panelists today, especially as it pertains to credit availability.

 

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