Mr. President, I rise in support of our family farmers. Agricultural producers are in desperate need of immediate assistance. We need to find the best option available in these trying times.
The Democratic proposal in front of us attempts to address the problems confronting our family farmers, but falls short of our most important goal which is providing assistance as quickly as possible.
I realize that this disaster affects farmers all across the nation, but at this moment I am most concerned about my friends and neighbors back in my home state of Iowa. I am concerned that by tying revenue relief efforts in with LDP payments, we will delay the efficiency of delivering the payment we enjoy with transition payments.
The Democratic alternative offers provisions that would have a long term effect on agriculture. I don't want anyone to misunderstand me, I think there are many things we can do to improve the agriculture economy, but the task before us today is to develop and pass a short term relief package that we can get out to those in need as quickly as possible.
According to the Farm Service Agency's estimates, the transition payments provided to corn growers this year will pay out at a rate of 36 cents per bushel. The supplemental transition payment Republicans are offering will equal an additional 36 cent increase on every bushel of corn produced this year. That's 76 cents in assistance for Iowa's family farmers before you figure in any income through Loan Deficiency Payments.
As a Senator from Iowa, I believe that it is also particularly important to include language providing relief for soybean growers, who are not eligible for transition payments. That is why our proposal also contains $500 million in direct payments to soybean and other minor oilseed producers.
I am proud to say Iowa is number one in the nation in the production of soybeans, but our growers have been hard hit by devastatingly low prices. Prices for soybeans are the lowest theyhave been in nearly a quarter-century, down from the seven-dollar-a-bushel range just a couple of years ago to less than four dollars today, which is below the cost of production. That's why I, and other Senators representing soybean producing states, wanted to make sure soybean growers were not left out of any relief package.
Finally, Mr. President, the Democrat proposal falls short in another very important area. It undermines United States negotiating objectives in the new multilateral trade negotiations that the United States will launch later this year.
It will sharply weaken, and perhaps destroy, United States efforts to limit the enormously expensive European Union production subsidies that make it impossible for our farmers to sell to 540 million European consumers.
I would like to say a brief word on each point.
First, the United States just presented four papers to the World Trade Organization in Geneva outlining United States objectives for the new agriculture negotiations. The first of these papers deals with domestic support. It states that the United States negotiating objective with regard to domestic support is a negotiation that results in "substantial reductions in trade-distorting support and stronger rules that ensure all production-related support is subject to discipline..."
Mr. President, production-related payments are, by definition, trade distorting. They are exactly the kind of payments we want the European Union to get rid of. I don't know how we can enter into tough negotiations with the Europeans, with their production payments our number one negotiating target, while we boost our production-related payments at the same time. This would undermine our negotiators, and give the Europeans plenty of reason to hang tough and not give an inch.
My second point is closely related to the first.
We will measure success at the new world trade talks based on how well we do at creating an open global trading system. The European Union's Common Agriculture Policy nearly torpedoed world-trade negotiations in the early 1990s. The EU later said it was reforming the CAP, but farm handouts this year will reach a record $47 billion, nearly half the entire EU budget. Moreover, the largely production-based EU subsidies still help those who least need help. Twenty percent of the EU's richest farmers receive 80 percent of CAP handouts.
World farming is sliding deeper into recession, with prices for some commodities touching historic lows. Now is not the time to give up on pressing the EU hard to truly reform this vastly wasteful subsidy program. But that is exactly what we would end up doing if we go down that same road.
There are many enemies of agriculture market reform in the EU who are just looking for any circumstance to justify their special pleading, and to keep their production subsidies going.
I am afraid that's exactly what the Democrat plan will do. We should not hand the EU an excuse to back away from real reform that opens the EU's huge agricultural markets to American farmers.
Mr. President, the proposal we pass today should be the fastest and most efficient option available to help our family farmers. The most important thing we can do today is work toward providing emergency revenue relief to our farmers as quickly as possible. It is for that reason I urge my colleagues to vote for a Republican alternative to provide ample and immediate relief for hard-hit farmers.