Grassley said the first of two amendments he developed with Sen. Kent Conrad defines U.S. agricultural trade objectives for the World Trade Organization negotiations that begin next month. In recent weeks, Grassley has conducted oversight hearings and met with top officials from the European Union to discuss issues that will be addressed by the WTO.
"The outrageous subsidies and trade barriers put up by other countries leave American farmers at an unfair competitive disadvantage in the world marketplace. Tackling these obstacles is critically important as we work to increase farmers' income and improve the rural economy. Our amendment spells out the goals our negotiators must meet in order to be successful for American agriculture," Grassley said.
Those objectives include:
immediate elimination of all export subsidies worldwide, with maintenance of bona fide food aid and preservation of U.S. market development and export credit programs that allow the U.S. to compete with other foreign export promotion efforts;
a level playing field for U.S. agricultural producers by elimination of "blue box" subsidies and discipline for domestic supports in a way that forces producers to face world prices on all production in excess of domestic food security needs while allowing the preservation on non-trade distorting programs to support family farms and rural communities;
discipline for state trading enterprises by insistence on transparency and the ban of discriminatory pricing practices that amount to de facto export subsidies so that enterprises do not sell in foreign markets at prices below domestic market prices or prices below the full costs of acquiring and delivering agricultural products to foreign markets;
insistence that the Sanitary and Phytosanitary Accord agreed to in the Uruguay Round applies to new technologies, including biotechnology, and clarification that labeling requirements to allow consumers to make choices regarding biotechnology products or other regulatory requirements cannot be used as disguised barriers to trade; and,
increased opportunities for U.S. exports of agricultural products with the reduction of tariff and nontariff barriers to the same or lower levels than exist in the U.S., followed by elimination of other barriers.
Grassley said the bipartisan amendment also would require the Office of the U.S. Trade Representative to consult with key congressional committees before signing-off on any agriculture agreements.
The second Grassley/Conrad amendment would amend the Trade Act of 1974 to make farmers eligible for trade adjustment assistance when the commodity price drops by more than 20 percent below the average price for the previous five-year period and imports contributed "importantly" to this price drop.
Grassley said that if both of these requirements are met in a given year, farmers would receive cash assistance equal to half the difference between the national average price for the year and 80 percent of the average price in the previous five years, multiplied by the amount of product that the farmer has produced.
"Our amendment would make sure that farmers recover a portion of the income lost due to import competition," Grassley said. In fact, when President John F. Kennedy first envisioned the Trade Adjustment Assistance program he said it should help farmers. Grassley said that "the unfortunate reality is that family farmers never really qualify for the program. Our amendment would make sure they do."
Grassley is chairman and Conrad is a member of the Senate International Trade Subcommittee. Grassley said their amendments are ready to be offered to the sub-Saharan Africa trade bill.
