SEN. GRASSLEY HOLDS A NEWS TELECONFERENCE
NOVEMBER 25, 2008
SPEAKER: SEN. CHARLES E. GRASSLEY, R-IOWA
GRASSLEY: Happy Thanksgiving to everybody.
Say, I've got several points I want to make on a story that I think came out yesterday. And my interest in something ongoing about cutting down on 10 percent of the biggest farmers getting 70 percent of the farm program payment. I know we made changes in the existing law to change that, but we've got evidence that over the last few years that even with a bigger income figure where you were ineligible, still, too many farmers were getting benefits from it.
I released a GAO report on improper farm program payments. Last year, we released another report and held hearings before the finance committee on payments going to dead farmers. Now, we're hearing that not only have payments gone to people dying or dead, we have payments going to owners of professional sports teams.
This report shows that the department has been making a good deal of potentially improper payments to farmers who exceed income eligibility. The report points out that the department could not guarantee that millions of dollars of payments went to more than 2700 people improperly because it doesn't have management controls in place that would prevent or flag such payments.
The department contends that this is a very small number of people, but it adds up to $49 million. And that's a lot of money that could go for school lunch programs for low-income kids, or it could be a bottom line on the deficit.
Now, in addition to what I just said about their excuses, the department argues that they don't have the resources or the authority to access IRS taxpayer data. However, the FFA county offices can and should request a waiver from producers to check income eligibility. And they, obviously, haven't done that.
The bottom line is that if the department feels it needs more authority to assess IRS data, they ought to come to Congress and ask me for authority. Section 6013 of the Internal Revenue Code protects taxpayer's privacy, but in spite of that, income criteria are increasingly being used to determine eligibility for government programs. So it makes sense to consider looking at 6103 to allow the IRS to share information with federal agencies if it's going to save the taxpayers money.
The Government Accountability Office also points out with the passage of the 2008 Farm Bill that there will likely be more recipients exceeding income limits that the department is going to have to watch out for. What may be most troubling is the fact that the department identified 87 of these 2700 individuals who exceeded the amendment yet continued to distribute payments even after they knew they were ineligible.
So with this type of action, it's hard to have faith in the department that would lower income limits in the 2008 Farm Bill that we're going be able to save more taxpayer's money. But it's quite obvious that Congress is clamping down. I'm disappointed that the department continues to struggle with ensuring proper payments. These are taxpayer's dollars. And I think the department should be very proactive.
I want to wish all of you a happy Thanksgiving. I'm ready for questions.
OPERATOR: Dan Looker of Successful Farming.
QUESTION: Good morning, Senator Grassley.
Do you think that -- do you have any reason to believe that the USDA, under the new Obama administration, will do a better job of enforcing this?
GRASSLEY: Well, I am going work very closely with him to see that it happens. I think the intention of the new farm bill brings attention to it. And we have a new secretary of agriculture, who that will be, you know, since Vilsack, I found out, no longer was asked about it -- and we thought he had been. And I was very hopeful that he would be in there. I don't know who we're dealing with.
But here's another problem that probably is not true just of USDA but a lot of agencies. You've got a lethargy against enforcing these things that -- that's -- in pretty much in concrete in the lower levels. So even if you come in with a new secretary of agriculture, unless he's making a big point of firing people on points like this, nothing is going to get done. He's going to have to use a heavy sledgehammer.
QUESTION: Thank you.
QUESTION: Good morning, Senator, and happy Thanksgiving, sir.
GRASSLEY: Yes?
QUESTION: On the payment situation that you're talking about on the Farm Bill. What can or should be done specifically to address this problem? Should there be some time of, I don't know, legislation against USDA or something to get them to -- to follow that stricter or to do something about that?
GRASSLEY: Well, they need to talk it over with every farmer to begin with. They've got tools now in the new Farm Bill to do it. And I think it's as simple as using those tools. And if there aren't enough tools there, come to us. I'm a little distraught that already the attitude is out that just because we changed the law they're going to have a more difficult time doing it.
I mean, after all, every farmer comes in and signs up separately. All you've got to do is talk to them about it.
QUESTION: And would it take any type of, I don't know, legislation to, perhaps, get those waivers so that they will be able to get, maybe, a little more headway on it that you were mentioning?
GRASSLEY: I don't think it takes it. I think any farmer that would be considered a big farmer, and if he's ineligible, you'd think if he was put to it, the questions, that he would -- would admit because doing otherwise would be a fraudulent activity.
OPERATOR: Gene with Iowa Farmer Today.
QUESTION: Yes, Senator, out of curiosity, is this one of those situations where the payment limits that you had proposed before, would those have been easier to enforce than the income limits here?
GRASSLEY: Yes. Because I think that when you put a $250,000 cap on, you obviously set your computers for not one person with one number getting more than that. It would kick it out automatically. It doesn't require checking with the AGI, the adjusted gross income, which then requires, you know, some communication between the department and the taxpayer.
OPERATOR: Tom with Brownfield?
QUESTION: Yes, Senator, what, if any, responsibility lies with the farmer in all of this? What should be on their shoulders?
GRASSLEY: Well, I don't know. The responsibility is if you're participating in the law, in the program, you presume you know what the program says. And under the old law, two and a half million dollars, if you were over that, you shouldn't have been in the program. I would say that there's a moral responsibility.
Now, not everybody knows what the law is. I'm a farmer. I wouldn't want to claim that I know everything about the law. So, you know, you ask -- we go to the county office regularly or phone them to get information. But it's just like the income tax laws. As long as you want to lie and you want to play the tax lottery, you can get away with it. So maybe you got people here that want to.
So then it gets back to the government policing it and doing it vigorously enough so that people will be honest.
OPERATOR: Dan with Spencer?
Chris with DTN?
QUESTION: Senator, do you see any though as more indicative problem just throughout government, just, you know, defense contractors that get paid without the work actually being done? Same maybe in the Department of Education? It just seems, as a taxpayer, I think we are almost jaded to this fact that our government is paying money to people when they're not earning it.
GRASSLEY: Yes. Let's take an example that is easy for me to speak about this because I got some figures in my mind. But if you go back 15, 20 years, we had, you know, 15 to 20 percent of the people weren't paying their student loans. We changed the law, started cracking down on it and let them know that we were serious about enforcing the law. And we probably have people being dishonest about paying back guarantee student loans down to maybe 5 or 6 percent. Maybe it's even better than that. I don't want to -- I don't want to denigrate the efforts, I just don't have the most recent figures in my mind.
And when you have guaranteed student loan programs or I could even apply it to FSA guaranteed farm loans, we get that down to about 5 or 6 percent. We're dealing with people that -- that are on the edge of being eight get credit anyway. So if you got 90 -- if you help 95 percent of the people are credit and they move ahead and six aren't able to make it, it doesn't mean that they've been dishonest.
We would say that that's worth the taxpayer's investment because you got 95 out of 100 people benefiting from the program, and it's meant to help people that are on the edge of getting credit.
So from that standpoint, you know, it's kind of a standard that we go by. And if we -- and in the case of payment, you know, it ought to be more important for people to be honest if they aren't borrowing money. They're actually getting the money given to them.
QUESTION: Thank you, Senator.
OPERATOR: Stacia, National Farm Broadcasters?
Gary at Arkansas Radio Network?
QUESTION: Thanks. I'm going change the subject.
I've been asking everybody about climate change, Senator. Senate Boxer wants to move forward on a bill. President-elect Obama is making it a priority. Do you see a fast move on climate change legislation? Do you think agriculture will be adversely affected by it if we do get one?
GRASSLEY: Well, you know, there's a big push now among farm organizations and farmers in the industry to exempt agriculture. And to the extent to which agriculture would be exempted, it would move forward. And the extent to which, you know, every time I plant corn and soy beans, photosynthesis takes CO2 out of the air to manufacturer food. So, obviously, a lot of things we're doing in farming is contributing to the reduction of CO2.
The extent to which we produce ethanol, it helps. The extent to which we're moving towards alternative energy. The extent to which we use natural gas, which is clean burning (inaudible). And things of that nature. It seems to me that we're contributing quite a bit to cut down on global warming.
And if you look at what buffaloes, 600 million buffaloes used to eat on the grass prairies of the Midwest and what they were putting into the air in the way of pollutant compared to cattle operations today and other animal operations today, you'd know that in this part of the country, we're doing a lot less to contribute to it.
But the other things is moving ahead as the United States, putting a tax on carbon, as an example. When the United States economy is in the doldrums, as it is right now, and more bad news this very morning, it's quite a gamble to pass big tax increases, big costs on the economy, particularly, when people like Senator Boxer, I'll bet, will be some of the very same people that will be complaining over the last ten years about the outsourcing of jobs. Basically, what they're doing is driving all manufacturing overseas to China unless we get China into an international organization and get them going right now to reduce CO2 because they're the number one polluter.
And so you're putting the United States economy, in particular, our manufacturing in a vice at the very same time people are complaining about shipping jobs overseas.
QUESTION: So I'm going to boil it down. You're saying you will oppose the legislation. If the legislation does get through, you want an agricultural exemption?
GRASSLEY: I'm going to work for fairness. You know what? Everything I just said to you is pretty much a macro approach. And I'm not going to say what I'm going to vote for maybe nine months before it comes up. But I'm telling you where I'm coming from from the standpoint of economic competitiveness of U.S. industry, U.S. agriculture, for people to have an appreciation of what agriculture contributes to reduction of global warming, how we're working in that direction already and to make sure that every segment of economy is treated fairly and that the United States is treated fairly with competitors overseas. And in the process, as I've been implicit in this statement, to make sure that people that have been complaining about the economic competitiveness and the outsourcing of jobs are intellectually honest and aren't talking out of both sides of their mouth.
QUESTION: So you're saying you do believe it will come up in 2009?
GRASSLEY: Oh, yes.
QUESTION: OK. I did have one other question.
GRASSLEY: Yes?
QUESTION: Are you going to be able to keep your seat on the Senate Ag Committee?
GRASSLEY: That's entirely up to Senator McConnell. And I can tell you that as of yesterday, we got a form from him. And he asked what our priorities were. And for 24 years, 28 years, my priorities have been judiciary finance. And the reason agriculture wasn't a priority back when I first started out is because Senator Jepson (ph) was the Republican on the committee at that time, and I couldn't get a seat on it.
Just as soon as I could get a seat on it, I did get on seat on it. I think I've been on it for 18 years except for short periods of time. And I'm trying to get back on. I used to be able to get on prior to six years ago based strictly on seniority if there was a seat available. And there was usually a seat available.
Then when we changed our realize that you can only have two committee assignments by seniority, the third committee assignment is by appointment by the leader of the party, then that's McConnell. So I have to impress upon him the importance of having a family farmer on the committee.
QUESTION: Thank you, Senator.
OPERATOR: Philip with the Register?
QUESTION: Yes, Senator, I want to follow up on the climate change issue because there have been signals from the Obama administration that they're going to go forward with regulating greenhouse gas emissions with the clean -- under the Clean Air Act, which is something that the Bush administration did not do.
And there's some in agriculture worried that the farmers are going to get caught up in this and have to go through permitting because of the emissions from the newer nitrogen application.
What -- what would your reaction be to that? What do you think the impact would be?
GRASSLEY: My reaction to it is that probably the very same people that are worried about the food-to-fuel debate and against using corn for ethanol, et cetera, et cetera, that they're the very same ones pushing it.
So they maybe talk out of both sides of their mouth because nitrogen is very important for the production of corn, as you know. And if they decide to go ahead, quite frankly, they're doing that, I think, under the 1990 act. And if they decide to do it administratively with the makeup of the new Congress, unless there's a tremendous scientific out roar against it as well as an economic problem that comes, but I think it would take a tremendous drive to stop it if that's where they're headed for. And it wouldn't surprise me that's where they're headed.
And all we can do that know about agriculture is to pretty much, you know, fight what we might consider unrealistic. Now, you know, everything that they might want to do in regard to greenhouse gases and the regulations you're talking about, if it's done in a sensible way, probably -- if it's done scientifically, could be the right thing to do.
And I'm not going to make a judgment on the overall thing, but I think I have a responsibility to speak out on the -- on the -- on the specific issues, particularly, that deal with agriculture and where people might be somewhat inconsistent.
But we're dealing with the EPA, Phil. And -- Philip. And let me just suggest to you something that we're probably going to have to face again. And that's that dust thing. Last night, you know, as we were -- it was -- it was dark when we were combining corn. And I thought to myself, as the hopper was unloading onto the -- onto the wagons that you could see all of the, what we call, the dust. You know, the little red dust. We call it (inaudible) wings, I guess.
And I thought to myself we need somebody out here at EPA. Do they think Chuck Grassley ought to be out here at 9 o'clock at night trying to control the wind and that dust as those kernels of corn go into the wagon? And the dust, because of the wind, is floating away.
And so, you know, I -- I just wonder about the reality of people in EPA.
OPERATOR: OK. Does anybody have a follow up?
QUESTION: Senator, following up on the question regarding committee assignments. I heard last week that you might face some challenges, potentially, to your -- to continuing to being ranking member on the finance committee. Have you heard any concerns that somebody might challenge you for that position?
GRASSLEY: Well, I hope that that's a -- I have not heard that. And you are the first one to bring it up. And so where did you get your information?
QUESTION: I was just basically talking with some lobbyists out in D.C. last week over that issue. So I didn't -- you know, whether it was actually...
GRASSLEY: Can you name them so I can follow up?
QUESTION: Huh?
GRASSLEY: Can you name them so I can follow up on it?
QUESTION: Name the...
GRASSLEY: The people you were talking to?
QUESTION: Well, you know, I don't know how much they actually knew, which is why I was bringing it up with you.
GRASSLEY: So you don't know -- they weren't...
QUESTION: I don't know whether, you know...
GRASSLEY: Were they saying I might be challenged or they were saying I would be challenged?
QUESTION: Well, they were just saying it was -- they thought it might be a possibility.
GRASSLEY: Well, I guess it's a possibility every...
QUESTION: But you have not yourself been, obviously, heard of anybody -- of any other senator seeming to challenge you for that position?
GRASSLEY: No. I can tell you, in the last, you know, I don't know whether -- it wouldn't be decided by Senator McConnell. It's going to be decided by a majority of the people in our caucus who's going to be ranking member on every committee.
We've been doing it that way for the last ten years, I believe. Prior to that, it was entirely seniority. And we do have limits. And I've only got two years left on the time that I can serve. But it's up to those groups.
But I can tell you that I've got lots of letters from colleagues, particularly, Leader McConnell, who's been, you know, thank you -- thank you for the work you did on this bill or that bill or that bill. And he usually pens a P.S. down at the bottom, you know, great job and stuff like that. So I would assume that if the leader is satisfied with me that we would be OK.
And -- but I would say this. You know, the tools that I have to be a senator, you know, outstanding tax professionals, health care professionals, investigators, you know, what we talked about today -- all the stuff that I did on, you know, oversight of the ag program to make sure big farmers don't get paid.
I've got a real professional staff in the finance committee that I would not have access to any more because whoever would take over would hire them. Or I mean, maybe not hire them. But they wouldn't be -- they wouldn't be under my authority. And everything that I'm able to do as a fourth ranking member of the Republican Party and probably ninth ranking in the entire Senate, would be -- I'd be very much crippled to do the things that I've been doing.
And so I would -- I would -- that's the reality of it.
QUESTION: Well, sorry to raise it if it wasn't an issue.
GRASSLEY: Well, I haven't -- I have not heard it being an issue.
QUESTION: All right.
GRASSLEY: But I think you have alerted me to something that I need to stay on top of.
OPERATOR: OK. Does anybody else have a follow up? All right. Thank you very much.
END