WASHINGTON, DC – U.S. Senator Pat Roberts today voted against final passage of the 2014 Farm Bill conference report because it goes backwards towards protectionist subsidy programs, instead of forward with innovative and responsible solutions for producers and the taxpayer. The report was approved by the Senate with a vote of 68-32 and now heads to the President’s desk to be signed into law.

Last night, Senator Roberts again spoke on the Senate floor regarding his concerns with the conference report, especially for Kansas farmers and ranchers. Audio and video of his remarks here.

The following is text of Senator Roberts’ remarks from his floor speech Monday as prepared for delivery:

I am here today to go beyond my philosophical concerns with the direction of the legislation and will instead focus on how the 2014 farm bill will negatively impact agriculture in Kansas, my home state.

            Remember, the Farm Bill is not a simple reauthorization or continuation of our nation’s farm and food programs. We have already done that once with a one year extension of the 2008 bill. 

            Instead, the legislation before us should be a whole sale rewrite of the programs and policies at the Department of Agriculture.           

            When this bill is signed into law by the President and fully implemented, producers will have to make choices among new safety net programs, new regulations, and rules.           

            Some of these choices will happen only once and will be irrevocable – they cannot change - for the next five years.

            We owe it to these farmers, ranchers - small businesses owners - as well as the next generation of producers, to get this legislation right.

            Unfortunately, I believe that Congress has missed the mark, and that the conference report goes backwards towards protectionist subsidy programs, instead of forward with innovative and responsible solutions.           

            I am not alone in that assessment, as reported by the Kansas City Star on Friday, January 31^st - “All four Kansas House members voted no — on what is arguably the single most important piece of federal legislation in Kansas.”

            That should grab everyone in America’s attention – the entire House delegation from the wheat state – was united in opposing this version of the farm bill.           

            It is not that we do not appreciate agriculture or the producers and their families in our state, it is entirely the opposite – we care so much that after three years of work we will not settle for supporting backwards legislation “just to get something done.”

            I call it a look in the rear view mirror.

            I understand that compromises were made, but I cannot support a bill that marches backwards towards producers making decisions based off of government subsidies, retaliation against our livestock producers, and once again agriculture taking a disproportionate cut in spending compared to federal nutrition programs.        

            When Chairwoman Stabenow and I started the process of rewriting the farm bill, Kansas producers - regardless of what they planted – said over and over again that their number one priority and concern was the availability of crop insurance that protects in case of disaster.

            They were also fully aware that direct payments would no longer be available to them, and most are okay with that direction.

            However, Kansas producers did not ask for a continuation of a target price subsidy program and they certainly did not want Congress to raise the target prices of all commodities.           

            Two years ago in 2012, the Senate Agriculture Committee and the full Senate passed a farm bill that ended the countercyclical commodity subsidy programs.           

            If signed into law the 2012 Senate farm bill would have taken the federal government and USDA out of the business of sending signals to producers essentially telling them which crops to plant. Unfortunately, that reform was never fully realized.   

The new Price Loss Coverage (PLC) Program, contained in this conference report, sets high fixed target prices and subsidies for all commodities and regions of the country.           

            Last week after the final details of the bill were released I talked with a producer near Dodge City that is a member of my volunteer ag advisory council that I fondly refer to as my “ag posse”

            With the current cash price for wheat at the Dodge City grain elevator around six dollars and a target price guarantee for wheat set at $5.50 per bushel for the next five years, I asked the young, successful, and informed producer, what are you going to plant?

            What he told me should not surprise anyone. He said, “Pat, I’m going to plant wheat, for the government subsidy.”

            His answer only reinforces one of my biggest concerns with this conference report. When the federal government guarantees producers a subsidy triggered off a “target price or reference price” it always has and always will lead to planting and marketing distortions.           

Today, many producers have a college or advanced degree, often in business; they are going to evaluate the programs at the Department of Agriculture and make decisions that benefit their business’s bottom line.           

            Instead of planting grain sorghum, corn, or soybeans, my friend in Western Kansas already knows that he is going to plant the crop that he is guaranteed to receive the highest subsidy payment from the government…not the market…in this case wheat at $5.50 per bushel over corn with a target price of $3.70 per bushel.

            I have yet to hear one explanation for why Congress is not only including target prices for corn, wheat, sorghum, soybeans, rice, peanuts, and barley, but raising and fixing their prices regardless of movements in the market.

            Kansas is the “bread basket of the world,” so you might think that Kansas producers planting more wheat would be a good thing…however simple economics and history demonstrate why this is a dangerous road for the federal government to take.

            When all producers in Kansas, and the rest of America, have the same price guarantees and signals to plant wheat and the majority make the business decision to follow subsidy signals instead of the market, over time there will undoubtedly be more production than global demand.

            We will have a surplus of wheat leading to a lower wheat price. Now this could normally be corrected by market signals, but with the fixed target prices, farmers will continue to plant wheat for the subsidy guarantee, leading to further overproduction and even lower crop prices. 

            This cycle of overproduction, low grain prices, and expensive support payments, could eventually lead back to the days of mandatory quotas and acreage allotments, known as set asides. 

            Producers in Kansas want none of that from their federal government.

            Besides having high fixed target prices, the new Price Loss Coverage (PLC) Program sets the price guarantees so high that some are at or above the producer’s cost of production. 

            This would mean that the government is essentially subsidizing a producer so much that they are guaranteed to make a profit if they have a normal or average yield.

            It gets worse. The early analysis that I have seen shows that the target prices are high enough that Rice, Peanuts, and Barley growers will receive a subsidy payment at least 75% of any given year; likely triggering a payment four out of the next five years. 

            Other commodities are not treated as favorably, with wheat prices likely to trigger a payment on average only 35% of the time and soybeans less than 15%.

            What that tells me is that the new target price guarantees are set high enough for a few commodities to trigger subsidy payments with a high frequency.

            Folks, this is no longer a risk management tool or part of a responsible safety net. Make no mistake; the Price Loss Coverage Program is nothing more than a “Profit Protection” program for some commodity growers.

            Now, the lone commodity that has moved out of price supports entirely was forced to after learning the lesson the hard way.

            In 2002, the World Trade Organization ruled against the United States for our Cotton programs, including a decoupled target price subsidy. In a settlement with Brazil, we have been paying their producers $147 million a year for damages.

            When the President signs this bill into law and after two more years of direct payments, cotton producers will move out of the subsidy based program to crop insurance as their main safety net.           

            If recent history repeats itself, the Amber Box subsidy programs in this bill could lead to further global trade disputes – which we have already lost and will likely lose again if challenged.

            The WTO stove is still hot – why would we reach out and touch it again?       

            As much as I disagree with the backwards direction of the commodity title, Kansas livestock producers may have more “beef” with the conference report.           

            Kansas is in the heart of cattle country and after multiple years of drought, livestock producers in my home state are waiting for disaster assistance that has been unnecessarily delayed for over three years.

            Yet, when taking the full conference report under consideration, both the Kansas Livestock Association (KLA) and the Kansas Pork Association strongly oppose this bill.

            In a letter sent to me by Jeff Sternberger, President of the Kansas Livestock Association, he says “We are deeply disappointed the report does not address our two priority issues, mandatory country-of-origin labeling (COOL) and the Grain Inspection, Packers and Stockyards Administration (GIPSA) rule on cattle marketing.”

            Mandatory country-of-origin labeling, (COOL) is a marketing program, however our closest trading partners have found the practice anything but COOL.

            Canada and Mexico are two of our biggest and historically strong markets for U.S. beef, pork, and chicken exports. In 2012 alone, Canada imported over one billion dollars’ worth of U.S. beef and Mexico imported over $800 million.

            If we do not come into compliance as required by the World Trade Organization (WTO) Canada and Mexico will retaliate against the United States. 

             Why do I bring this up? For one, Canada is the top export market for Kansas agriculture products. 

            In 2012, Kansas exported $405 Million worth of agriculture and food products to Canada. Animal meats alone totaled over $180 million that year.

            Canada’s published retaliation list includes 23 Kansas agriculture products including fresh and frozen beef and pork worth over a combined $160 million per year.           

             Without these markets, Kansas livestock producers will lose value on their products, negatively impacting one of the biggest drivers of our state’s economy.           

            Unfortunately, our efforts to fix COOL in the farm bill conference committee fell short, to the displeasure of our livestock producers and trading partners.

            The GIPSA rule on livestock marketing also should have been addressed in the final farm bill conference report.

            The House version of the farm bill had strong provisions that would have let our livestock producers make their own marketing decisions, instead of GIPSA, yet the provisions were left entirely out of the conference report with no explanation or transparency.

            Finally, I have to address a major inequality in the final conference report…and that is nutrition spending.

            When the Congressional Budget Office (CBO) released their official estimate of the budgetary effects of the Agricultural Act, I was more than disappointed.

            According to their letter, “CBO estimates that direct spending stemming from the programs authorized by the conference agreement would total $956 billion over the 2014 to 2023 period, of which $756 billion would be for nutrition programs.”

            When you do the math, that means that 79% - nearly 80% - of the total spending in the farm bill will go to nutrition programs including, SNAP, the Supplemental Nutrition Assistance Program.

            The final compromise includes $8 billion in food stamp savings mainly from tightening the Low Income Heating and Assistance Program (LIHEAP) Loophole, which amounts to a ONE percent reduction to nutrition spending. That is just one percent out of a $750 Billion program.

            The Senate Committee on Agriculture, Nutrition and Forestry recently released a statement with the headline “Deficit Reduction: The 2014 Farm Bill” showcasing the savings in the legislation.

            The release highlights the inequality between farm and food programs, and I quote “Farm subsidy programs were cut far more significantly than any other area of the budget under the Agriculture Committees’ jurisdiction. By comparison, farm subsidy programs were cut by 31%, while nutrition programs were reduced 1%.”

            You heard that right; the Farm Bill once again prioritizes spending for food stamps over all of the other Department of Agriculture programs including important conservation, research, and rural development programs.

            I am fine with reducing farm subsidies like the target price program, but we should have included additional reforms to the nutrition programs in a reasonable and responsible manner, but the conference principles decided on the final compromise behind closed doors.   

            While we all want to provide much needed certainty to producers, the conference missed an opportunity for greater and necessary reforms to our nation’s farm programs, burdensome regulations on livestock producers, and federal nutrition programs. 

            After over 3 years of deliberation and disputes over the farm bill… our producers, consumers, taxpayers, and our global trading partners, expect and deserve more than found in this conference report.

            As a conferee, I did not sign the conference report last week. As a Kansan and Senator from a large agricultural state I will vote against this rear view mirror legislation.      

            Although I will not vote for the farm bill conference report, I promise to all of Kansas agriculture that I fully appreciate the need for a farm bill, especially one that has been delayed for years.

             While we need a farm bill, we do not need this Farm Bill.   

            I truly respect what you do as a profession for our economy, and global stability. I will continue to work, advocate, and champion agriculture on your behalf every single day.

Senator Roberts is senior member and former Ranking Member of the Senate Agriculture Committee. In 2012, the full Senate passed a bipartisan Farm Bill introduced by then Ranking Member Roberts and Chairwoman Debbie Stabenow (D-MI) that eliminated target prices and contained forward looking reforms to agriculture programs. He is the first member of Congress in history to serve as both Chairman of the House Agriculture Committee and Ranking of the Senate Agriculture Committee.

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