Release No. 0201.02

 

STATEMENT BY SECRETARY ANN M. VENEMAN

Regarding Farm Bill Criticism

 

May 21, 2002

During farm media event in Washington, D.C.

 

                        “The new farm bill makes significant changes in farm program structure and funding.  The new bill will bring much needed stability to our farmers and ranchers as they conduct their business.  It continues direct payments based on historical plantings and yields. It creates a new system of countercyclical payments based on market prices in relation to target prices.  It revises and rebalances loan rates for the marketing loan program for major grains and oilseeds. It provides a record level of support for conservation, an 80 percent increase, 85 percent of which will be used for programs on working farmlands, and it adds new programs to preserve wetlands and improve soil and water quality.

 

                        “The Farm Bill contains the first ever energy title in a Farm Bill that will help us to look to agriculture for more energy uses.  It invests more in research, in animal and plant disease protection, in food safety and in rural development. And the new Farm Bill also contains new tools to support the expansion of trade for our agricultural products.

 

                        “Since the bill was signed, we've heard a lot of noise out there, particularly from people from other countries regarding what's contained in this new bill.  Many of the claims we're hearing, we think are just unjust, and some, for their own political purposes, are distorting the facts.

                       

                        “First, some are saying that the new Farm Bill provides a 70 percent boost in farm program support, and that support has ballooned out of control.  Well, that's not the whole truth.  People are comparing apples and oranges.  When examining the support we provide for our farm sector, it's important to add in the emergency supplemental support that's been provided during the last four years into those figures, to be accurate.  That's roughly an additional $7.5 billion each year for the last four years.   The new Farm Bill provides roughly $7.4 billion each year in new spending for farm programs.

 

                        “So as I said many times before, the Farm Bill continues with roughly the same amount of support as we've been providing our farm sector over the past four years through the '96 Farm Bill and the supplemental support.

 

                        “Some in other countries are also contending that this Farm Bill undermines our international trade position.  The WTO permits the United States to spend $19.1 billion annually for certain types of farm program support.  This compares to $31 billion for Japan and $62 billion for the EU. 

 

Therefore, the EU can provide three times more than the U.S. in allowable support.  Additionally, U.S. markets are relatively open already compared with other countries.

 

                        “Our tariffs on agricultural products average about 12 percent.  The food and agriculture tariffs around the globe average around 62 percent.  In Japan, they average 59 percent.  In the Cairns Group, it's about 30 percent.  It's also about 30 percent in the European Union.

 

                        “So while some of our trading partners want to point fingers, and some would argue throw stones while living in glass houses, I think their criticism is, in large part, to deflect attention from some of the realities I've just mentioned.

                       

                        “Again, the new Farm Bill does meet our trade obligations and the Congress provided a circuit breaker to assure that that will continue to be the case.

                       

                        “The EU, for example, still uses the most, by far, 90 percent of the total export subsidy support.  That is the most trade-distorting kind of support.  So there are major reforms that need to take throughout the world through the Doha Round, the new round of WTO negotiations, and the United States remains committed to aggressively pursuing trade reform.

                       

                        “The U.S. will continue to provide strong advocacy and leadership toward this objective.”

 

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