Sen. McCain Provides Wide-ranging Floor Statement on Senate Farm Bill

June 14, 2012 06:09 AM

Via a special arrangement with Informa Economics, Inc.

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

The following statement on the proposed Senate farm bill was made this morning by Sen. John McCain (R-Ariz.). It discusses and provides perspective on several major farm bill issues being debated:

"Mr. President, the Senate is currently considering the 2012 Farm Bill as is typically done every 5 years when the previous Farm Bill expires. During this Farm Bill debate, Americans will hear speeches about spending reductions and cuts to farm subsidies, and I concede there is some of that in this bill. Unfortunately, so far we've failed to have an open and fair amendment process unbefitting of the United States Senate. I have several amendments that I would like to have considered, and like my colleagues, we've been prevented from doing so.

"Regrettably, the fact remains that the programs authorized under this Farm Bill consume a colossal sum of taxpayer dollars. The Senate's Farm Bill is over 1,000 pages and is estimated to cost taxpayers $969 billion over 10 years. Mr. President, let that price tag sink in. That's almost $1 billion per page. It's a 60% increase from the previous farm bill that was passed in 2008. While I believe it's necessary to assist low-income families with nutrition programs, and that we should keep our farmers out of the red when a natural disaster strikes, I'm also mindful that taxpayers are saddled with a $1.5 trillion deficit and a ballooning $15 trillion national debt. We must reduce the size of the federal government and the Farm Bill is certainly ripe for spending cuts. Instead, Congress spends and spends with the full knowledge that we are about to drive off a fiscal cliff and face the debilitating consequences of sequestration and the disastrous effects it will have on our Armed Services and national security capabilities.

"Again, I acknowledge that the Senate bill generates $23 billion in savings, and that's a notable accomplishment. We've finally done away with Depression-era farm subsidies like 'direct payments' and the 'countercyclical program,' which encourages overproduction thereby triggering more farm subsidies to compensate for depressed prices. Unfortunately, it seems that Congress' idea of Farm Bill reform is to eliminate one subsidy program only to invent a new one to take its place. Cutting direct and countercyclical payments actually saved taxpayers about $50 billion, but rather than plug that money into deficit reduction, this Farm Bill blows $35 billion of its own savings on several new subsidy programs.

"For example, we have a new 'Agriculture Risk Coverage' subsidy program or 'ARC' which works by locking-in today's record-high crop prices and guaranteeing farmers up to an 89% return on their crop. ARC could cost taxpayers anywhere from $3 billion to $14 billion each year depending on market conditions. We also create a new $3 billion cotton subsidy program called 'STAX' that the Brazilian trade representative has signaled will escalate their WTO anti-dumping complaint against the United States. We already pay Brazil $150 million a year to keep our cotton programs, why would we make things worse? This bill authorizes the creation of a new marginal loss subsidy program for catfish. This bill maintains the $95 billion federally-backed crop insurance program which also subsidizes crop insurance premiums. We then pile on a new $4 billion program called Supplemental Coverage Option (SCO) that subsidizes crop insurance deductibles. Subsidized insurance, subsidized premiums and subsidized deductibles: I'm hard-pressed to think of any other industry that operates with less risk at the expense of the American taxpayer.

"This is all part of Farm Bill politics. In order to pass a Farm Bill, Congress must find a way to appease every special interest of every commodity association from asparagus farmers to wheat growers. If you cut somebody's subsidy, you give them a grant. If you kill their grant, then you cover their insurance premiums. Let's take a look at several other hand-outs that special interests have reaped in this year's Farm Bill:

  • $15 million to establish a new grant program to "improve" the U.S. sheep industry.
  • The bill authorizes $10 million to establish a new USDA program to eradicate feral pigs. Talk about pork barrel spending.
  • $25 million to study the health benefits of peas, lentils and garbanzo beans. Do we really need to spend millions of taxpayer's dollars reminding people to eat their peas?
  • $200 million for the Value Added Grant Program which gives grants to novelty producers like small wineries and-I'm not kidding-the occasional cheese maker.
  • $40 million in grants from USDA to encourage private land owners to use their land for bird watching or hunting.
  • $700 million for Agriculture and Food Research Initiative (AFRI), which funds a variety of research grants like testing pine tree growth in Florida or studying moth pheromones. When did it become a national priority to study moth pheromones? Can't the U.S. cotton industry pay for this research?
  • $250 million for USDA's "Urban Forest Assistance Program" which spends federal funds to plant trees in urban parks and city streets. I'm not anti-Arbor Day, but I suspect tree nurseries pull in some hefty profits with this government program.
  • The bill creates a new program that spends $125 million to promote healthy food choices in schools. There are at least four other healthy eating education programs in this Farm Bill already.
  • $200 million for the Market Access Program, which subsidizes overseas advertising campaigns of large corporations, like handing out Tennessee whiskey samples in India or subsidizing a sampling tour of mint candies in the U.K.

"Mr. President, we have the infamous mohair wool subsidy, which has been fleecing the American people since 1954. When Congress passed the 1954 Farm Bill, they wanted to ensure a domestic supply of wool for military uniforms by paying farmers to raise, among other things, angora goats for mohair. This may have held merit then, but nobody today can dispute that mohair became obsolete thanks to synthetic fibers. Today we use mohair in custom socks, fashionable scarves, and trendy throw rugs. Some of my colleagues may recall that Congress killed off mohair subsides in the 1990's. Unfortunately, goats are reputed to eat just about anything, and our hard-earned tax dollars are no exception. By the time Congress passed the 2002 Farm Bill, mohair subsides had been restored. The mohair program, which costs taxpayers about $1 million a year, may not be particularly expensive compared to most farm programs. I suppose where some of my colleagues see a minor government pittance for wool socks, I see a disgraceful example of how special interests can embed themselves in a Farm Bill for generations.

"Mr. President, as if field corn and ethanol subsidies weren't nefarious enough, this Farm Bill includes a new carve-out for popcorn subsidies. This is a perfect example of Farm Bill politics. Thanks to a provision snuck into a 2003 appropriations bill, popcorn started receiving millions of dollars in 'direct payment' subsidies. However, because the new Farm Bill eliminates direct payments, the popcorn industry is scrambling to be added to the newly created 'ARC' program. Under this Farm Bill, popcorn will be subsidized to the tune $91 million over 10 years, according to CBO.

"The cooking oil that movie theaters use to heat popcorn is already subsidized, as well as the butter they put on top. And why not wash it all down with a cold soda which of course contains subsidized corn syrup. The truth is popcorn is doing just fine. The price of popcorn has risen 40% in recent year's thanks in part to ethanol, and recent free trade agreements with Colombia and South Korea are creating a boom for American popcorn exports. There isn't a kernel of evidence that they need this support from taxpayers.

"The Farm Bill's sugar program is another masterful scam. The USDA operates a complex system of import tariffs, loans, and government production quotas that restrict sugar imports and keeps sugar prices artificially high. The sugar barons will tell you that USDA's sugar program operates at 'no net cost' to the American taxpayer because sugar doesn't receive 'direct payments.' In actuality, businesses and consumer bear the burden of the sugar program by paying higher costs for sweetened products. Every year, Americans consumers are forced to pay an extra $3.5 billion on sweetened food products. Just yesterday, the Senate voted to table an amendment to phase out the sugar program. Quite the sweetheart deal for sugar growers.

"Finally, Mr. President, there's catfish.

"I have filed an amendment (#2199) which would repeal a Farm Bill provision that directs USDA to create a new Catfish Inspection Office. I'm grateful for the support of my colleagues who've cosponsored this amendment: Senators Kerry, Ayotte, Shaheen, Coburn, Crapo, Bill Nelson, Enzi, Risch, Cantwell, Kirk, Inhofe, Whitehouse, and Cardin.

"What we're attempting to do with this amendment is simple. This amendment puts an end to the latest attempt by southern catfish farmers to restrict catfish imports. Five years ago, a protectionist provision was snuck into the 2008 Farm Bill that requires USDA to begin inspecting catfish. As my colleagues know, USDA inspects meat, eggs, and poultry, but not seafood. Thus, a whole new government office is being developed at USDA just to inspect catfish. Catfish farmers have tried to argue that we need a Catfish Inspection Office to ensure Americans are eating safe and healthy catfish. I wholeheartedly agree that catfish should be safe for consumers. The problem is FDA already inspects catfish - just like it does ALL seafood - screening it for biological and chemical hazards. If there were legitimate food safety reasons for having USDA inspect catfish, we wouldn't be having this discussion. Don't take my word for it - just ask USDA. When USDA completed an internal assessment for the program in December 2010, the Department said it could not establish a 'rational relationship' between the Catfish Office and the risks to human health concluding, 'There is substantial uncertainty regarding the actual effectiveness of the catfish inspection program.' The Department of Agriculture estimates that this questionable program will come at a cost to taxpayers: $30 million just to create the office and another $14 million each year thereafter.

"The Government Accountability Office (GAO) has also extensively examined the Catfish Office. In February 2011, GAO released a report saying the Catfish Office is at 'high risk' for fraud waste and abuse and that it's 'duplicative' of FDA's functions and would fragment our food safety system. Just last week, GAO issued a new report simply titled 'Responsibly For Inspecting Catfish Should Not Be Assigned to USDA' and called upon Congress to repeal the Catfish Office.

"This isn't the first time consumers have been hoodwinked by southern catfish farmers. When the Senate considered the 2002 Farm Bill, they slipped in an obscure provision that made it illegal to label Vietnamese catfish as 'catfish' in the United States. At that time, the State Department had recently reopened trade relations with Vietnam, and domestic catfish farmers in southern states found themselves competing against cheaper catfish imports. Domestic catfish farmers wanted to discourage American consumers from buying Vietnamese catfish by marketing it under its Latin name pangasius or "panga" even though it's virtually indistinguishable from U.S.-grown catfish.

"Although the panga labeling law was enacted, it ultimately backfired on catfish farmers. Panga catfish remained popular with American consumers because it's more affordable and tastes just as good as southern catfish. It is, after all, catfish. It was a senseless law, and my colleagues may recall that I came to the floor to fight against it. I asked the question: 'when is a catfish not a catfish?' Why would Congress pass a law that renames a species of catfish into something else? Now I find myself asking my colleagues to explain: when is a catfish a cow? Why would we single out catfish and put it in the same category as USDA-inspected beef? Ironically, catfish farmers are lobbying USDA to re-re-label Vietnamese 'panga' back to 'catfish' to ensure Asian imports are subject to this new USDA Catfish Office.

"There are grave trade implications if we don't repeal the catfish program. Trade experts warn that Vietnam, the largest exporter of catfish, has an extremely persuasive case that establishing this Catfish Office would constitute a WTO violation. The WTO allows members to set their food safety standards so long as such standards are based on sound science and do not result in unjustified trade restrictions. Well, USDA and GAO already said there's no scientific basis for the office, and USDA warns that the 2008 Farm Bill would require them to ban catfish imports until foreign countries establish 'equivalency requirements' which could take 5 to 7 years to complete. Asian catfish importers have signaled that a 5 to 7 year ban on catfish is a free trade violation, putting our $20 billion U.S. export market in Vietnam and China at risk of WTO retaliation. Is it worth sacrificing the export markets of our American beef producers and wheat and vegetable farmers just to protect a southern catfish industry that doesn't want to compete? Absolutely not.

"This Catfish Office offers no legitimate food safety benefit. Its true goal is to erect trade barriers on Asian catfish imports to prop up the domestic catfish industry and make American consumers pay more for their catfish. It is time to put this issue to rest once and for all by passing my amendment.

"Therefore, Mr. President, I ask unanimous consent to proceed to S. 3240 (Farm Bill) and that McCain Amendment #2199 be made pending."

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.


Back to news


Spell Check

No comments have been posted to this News Article

Corn College TV Education Series


Get nearly 8 hours of educational video with Farm Journal's top agronomists. Produced in the field and neatly organized by topic, from spring prep to post-harvest. Order now!


Market Data provided by
Brought to you by Beyer