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Reflections On U.S. Agricultural Policy

Sen. Howell Thomas Heflin

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Mr. President, I have had the opportunity to serve on the Committee on Agriculture since 1981. The agricultural community in Alabama and the Nation, while small in number, is a considerable part of our economy. In fact in Alabama, agriculture and forestry are the largest sectors of the economy.

Therefore, I felt compelled to serve on this committee. It has been extremely difficult for most of the newspaper reporters in Alabama to cover the action of this committee. I felt at times that my press secretary needed to give them a map to find the Senate Agriculture Committee hearing room. The issues are complicated and few reporters have an understanding of the basics of farm policy. As a general rule, this accounts for the sparsity of news stories about agriculture in Alabama and Washington newspapers.

In addition to farm programs, the committee had jurisdiction over a great number of rural development programs, rural electrification, and rural water programs that are an extremely important aspect that can improve the daily lives of the millions of people that live in rural areas of this Nation.

The agricultural community is considerably better off today than when I came to the Senate in 1979. During my years on the Agriculture Committee, we have been able to craft foreign policy which provides market stability and allows U.S. farmers to aggressively pursue international markets. At the same time, these farm programs have dramatically reduced the cost to the U.S. Treasury. And the most important part that is so often overlooked, American farms provide a stable supply of food for American families at a lower cost than any part of the world. Legislation passed by the Committee is often called farm bills. It would be more appropriately entitled Food Safety and Consumer Protection Legislation.

In 1981, I had my first experience with the Congress' major farm authorization bill. With this bill, Members who strongly supported agriculture sought to expand foreign markets for U.S. exports and to protect them from selective embargoes. But Alabama's chief priority was the preservation of the peanut program. That year, the USDA and a number of Senators pushed for its elimination. But Alabama's farmers had just suffered 2 years of droughts, and they were already in a difficult situation. The program's proponents managed to push the program through the Agriculture Committee by a vote of 12 to 4. However, it was defeated on the floor of the Senate, and supporters had to work in the back rooms to devise the Heflin-Warner compromise. This effort succeeded. On the Senate floor, Senator Nunn credited me with the compromise:

* * * I think the Senator from Alabama has worked longer and harder on the peanut program than anyone I know in this body. He has spent literally hundreds of hours working diligently to protect the program that is of vital interest to the State of Alabama and also the State of Georgia as well as other states. * * * I have been following his lead on this issue as well as many other farm issues, and I thank him for an exceptional job all the way through.

However, it was just that--a compromise--and I was not entirely please with the outcome. For instance, although the 1981 farm bill established farm-based poundage quotas, increased loan supports, and a cost-of-production price escalator, it technically eliminated the peanut allotment program.

During the farm bill debate, Alabama's delegation was also very concerned with improving soybean production and exports. Over the previous few years, the U.S. share of the world soybean export market had dropped from 90 percent to 70 percent. Despite this drop, U.S. soybean production had tripled, but only because planting had tripled. Crop yields had not improved, and export policies were lagging. In fact, if the situation did not change, the United States would only create a domestic surplus of soybeans. So I introduced a bill to create the Research Soybean Institute, which would examine ways to improve production, exporting, and marketing. The institute would also address problems such as the cyst nematode parasite--and other issues like it. These provisions became a part of the 1981 farm bill.

With Senator Melcher's help, we passed another amendment to the farm bill which required that imported meats be held to the same inspection standards as domestic meats. Specifically, we sought to prohibit horse and kangaroo meats from being sold as ``beef.'' Clearly, this language had a dual purpose, to protect the interests of the cattle ranchers, and to ensure that consumers who bought hamburgers actually ate beef.

When the farm bill debate came to an end, I objected strongly to the administration's substitute bill. Although it retained the peanut compromise, the kangaroo and horse meat language, and the soybean institute, this bill has gone too far. This was the first attack on the farmer during my career; he had become a victim of the USDA's fiscal austerity in the Republican administration's sometimes too broad attempts to cut domestic spending in the wrong places. I objected chiefly to the commodity provisions, especially loan levels and target price figures, but I voted for the bill anyway because I thought it was more important to have a 4-year bill than none at all.

But implementation of this farm bill proved nearly as difficult, especially for peanuts. The USDA tried to enact regulations to cut the peanut poundage quotas. Its cuts would only hurt the small quota holders who could not afford the overhead of production. Supporters contracted the USDA, and cited the provisions in the peanut language which required a fair and equitable system for quota reduction. Targeting the small farmer like this was--* * * a misinterpretation of both the spirit and intent of the Congress if not an outright violation of the letter of the law itself. The USDA agreed to back off until it had received clarification of congressional intent.

The years following this farm bill also saw difficulties for the cotton program. In 1984, the administration sought a freeze in target prices, which it won. I blocked the bill when it came to the Senate floor, and I set conditions on this freeze. Specifically, I succeeded in setting the inventory carryover trigger for the paid diversion of cotton at 2.7 rather than 4 million bales in 1985, increasing the rate from $0.25 to $0.30 per pound if this inventory reached 4.1 million bales, and $0.35 if it reached 4.7 million bales. I also secured assurances for an extra $500 million in CCC export credit loan guarantees for 1984, including $100 million specifically for cotton, and $2 billion in 1985. Other successes which came out of this bill included changes to the FmHA disaster loan programs, including increased funding and increased loan ceilings, eligibility expansion to counties adjacent to declared disaster areas, extension of application deadlines to 8 months, extension of repayments limits by 8 years, and scheduling of interest rates to their original level or the current prevailing rate, whichever was lower. Sometimes it's like dealing with a mule--you have to use a 2 by 4 to get its attention.

When the next farm bill around in 1985, we introduced the Southern Agriculture Act of 1985 preemptively to save the peanut and cotton programs. Specifically, it would increase peanut poundage quotas to the existing level for the national, edible market. I also sought to allow for double cropping, conservation tillage, and other ideas endemic to the South. But these programs represented only one small part of overall farm policy; the export-import programs were certainly as great. I had hoped that the United States might also be able to increase its share of foreign markets.

The House Agriculture Committee adopted my Southern Agriculture Act that year without changes, making it, for a time, part of the farm bill. House Chairman Kika de la Garza of Texas gave me considerable support. Incorporation of the peanut program was eminently logical because it was the only program which had actually made the Government money over the previous 2 years. The Senate Agriculture Committee also adopted much of my measure, but I knew that it would be difficult to pass it through the full Senate. The Senate committee also incorporated language proposed by Senator Dole which I cosponsored to create a National Commission on Agriculture Policy into the farm bill.

When the Senate committee passed its version of the bill, I was certainly pleased that it included the Southern Agriculture Act, but I was disappointed with its export provisions. As I saw it, the problem with U.S. farm exports had been that the agriculture secretaries had not used the tools Congress created for them to implement an aggressive export promotional program.

In fact, when the conference committee reported its version of the bill, I was struck that it deceived and betrayed soybean farmers. The conferees had dropped our amendment to prevent the U.S. Government from providing loans or grants to foreign soybean producers. The committee had also changed another of our amendments to establish a marketing loan without lowering soybean loan rates. I intended the measure, which had passed the Senate, to authorize the Agriculture Secretary to implement a plan to increase competitiveness of American soybeans in foreign markets. The conference version, however, effectively legislated lower soybean prices for the farmer since it lowered the loan rates. American taxpayer dollars were being used to enhance the competitive capability of major soybean competitor countries such as Brazil and Argentina.

In fact, I voted against the 1985 farm bill coming out of conference. I believe that it effectively legislated lower commodity prices. The credit provisions were also unforgiving. FmHA loan availability decreased, and foreclosures were therefore likely to increase, I believed.

However, I was pleased that the bill maintained the peanut program, included better research titles, and addressed conservation. Specifically, the bill included the Conservation Reserve Program, and the swamp-buster and sod-buster provisions, which would allow for better long-term farming.

In hindsight, though, one of the most important provisions, if not the most important, was the establishment and implementation of the cotton marketing loan. It is generally understood that U.S. agricultural commodities must be competitive in the world market if the sector is to be economically viable.

Some 95 percent of cotton entering world trade does so with the benefit of a subsidy of one kind or another. The net effect is a world price which is often below the cost of production in most, if not all, exporting countries. In shaping cotton policy to address this kind of global competition, we had to decide whether to fashion a program which would enable U.S. cotton to compete aggressively or, instead, assume the role of residual supplier.

Until implementation of the marketing loan in 1985, U.S. cotton was generally relegated to the role of residual supplier. In 1985, however, we made a decision to meet subsidized competition head on. The establishment of the marketing loan has served to accomplish several fundamental marketing objectives: First, permits U.S. commodities to meet price competition, second, avoids excessive stock accumulations, third, allows producers to market commodities over a period of time, rather than dumping the entire crop on the market at harvest time and fourth, serves as a safety net under producer income.

I am proud of the cotton marketing loan and believe it has become the cornerstone of the U.S. cotton program. The indisputable success in the industry supports this assertion as the marketing loan has spurred domestic mill consumption and aided exports. For instance, the marketing loan is responsible for: reversing a 26-year decline in offtake of U.S. cotton; reversing a 43-year decline in U.S. mill cotton consumption; and reversing a 70-year decline in cotton's share of U.S. mill fiber consumption.

When the Senate considered its version of the 1986 tax reform bill, I strongly supported an amendment to restore provisions which allowed farmers to average their incomes over several years. It made up for revenue losses, which were estimated at $66 million, by repealing a tax break on wealthy, foreign real estate investors in the United States. Since there had been an increasing amount of foreign investor speculation in U.S. property, particularly in farmland, I thought it was appropriate to compensate for the revenue losses through this source. Another amendment the Senate adopted would refund unused investment tax credits to farmers. Specifically, the language provided for farmers to apply the credits against previous years' taxes at $0.50 per dollar. It also established yearly limits for the refund. The authors of this tax reform bill sought to eliminate credits for the future. However, since farmers were heavily capitalized with the high level of mechanization of modern farming, Congress needed to make tax reform a little fairer for agriculture by permitting farmers to trade in some of their unused tax credits for cash.

In 1986, critics of the cotton program maintained that it involved million dollar payments to large corporations. But this was an unfair characterization of the program. These large payments resulted from the Secretary's discretion; they were not mandated by the program itself. In fact, the program had ameliorated price reductions from domestic surpluses and improved sales overseas due to U.S. cotton prices that were on par with world prices for the first time in nearly 2 years. Competitive prices should provide the commodity with a turnaround.

In 1987, I introduced the farmers recovery tax bill to restore the income averaging price, investment tax credits, and capital gains, all of which had been repealed in the 1986 tax reform bill. As in the case of the amendments which I supported in 1986, these provisions applied exclusively to farmers. Before the passage of that bill, it had appeared that our tax policy was the only policy that provided some equity or incentive to the agriculture and timber sectors, but to compound the economic woes of rural America, the Tax Reform Act of 1986 repealed provisions of the tax laws that were beneficial to these areas of our economy.

When the 1990 farm bill came before the Congress, President Bush's administration sought to cut the cotton and peanut programs, but it failed. We also won a marketing loan for soybeans, specifically to increase America's international competitiveness in this market. Last, the bill included provisions we designed to provide funding for rural firefighting and to double the amount the Government could spend on the development of rural water and sewer systems.

As in 1985, I introduced the Southern Agriculture Act to reauthorize the cotton and peanut programs. The administration had proposed a 10-percent cut in these programs, but this bill would maintain the 1985 bill's statutes. What could the farmer buy that cost 90 percent of what it did in 1985? Certainly, farm machinery and fertilizer prices had not decreased.

With regard to the peanut program, Secretary Yeutter's proposed cuts would be devastating. If it had been adopted by Congress, it would not only destroy the peanut farmers, it would also cause a serious recession in the peanut-producing areas of Alabama and other States. At the end of July, the Senate defeated an amendment to implement his cuts.

One of the biggest problems about forging the peanut compromise in 1990 was the fact that division existed among the country's peanut farmers. Georgia's farmers had split from the rest, and I assumed the role of peacemaker between Georgia's peanut-growers and the rest, including farmers from Alabama. Notably, my compromise was the first supported by all the grower groups and major peanut product manufacturers.

The soybean loan included in the bill would serve to combat cheaper foreign competition. The loan was something I had fought for since the 1985 farm bill.

In 1986, I objected to the Reagan administration's decision to pursue the World Bank's loan to Argentina. Argentina was America's second greatest competitor in soybeans, and it was able to undercut U.S. prices and flood the world markets by directly subsidizing those firms that process and export soybeans. The World Bank loan would further subsidize competition to the United States--an unfair practice. In 1987, I attached language to the agricultural trade bill to prohibit U.S. subsidies for foreign farmers competing with U.S. farmers. One issue that had brought more complaints and more attention from Alabama farmers is the Government subsidies that enhanced the competitiveness of agricultural producers in countries such as Brazil and Argentina. Sadly enough, many of these subsidies were provided not by the governments of these countries, but rather by the U.S. Government.

At the end of 1987, I attached a soybean marketing program to the Senate budget reconciliation bill. This amendment would revive language that I had attached to the 1985 farm bill, but the conferees had effectively killed the provision by leaving it to the Secretary's discretion. He did not exercise that discretion. The soybean program involved CCC loans from 1988 through 1990, and I modeled it after my 1985 cotton program. I hoped that it would be an innovative approach that would provide enough flexibility to the Secretary of Agriculture to meet our world competitors on a level playing field. Although it passed the Senate shortly later, I had to reintroduce it in 1988. With a marketing loan, U.S. soybeans will be available on the world market at the same price as that made possible by foreign government subsidies for our foreign competitors. At that time, U.S. soybean acreage had dropped to a quarter of its 1979 level. Of course, the loan ultimately became a part of the 1990 farm bill.

With other provisions I included in the final bill, I sought to increase the farmer's flexibility to plant second crops on program plots. This practice is known as double-cropping.

With the Southern Agriculture Act, we also sought to create a Southern Institute for Agriculture Resource Policy to conduct scientific studies on improved farming techniques.

The committee also approved a proposal to provide Federal matching funds for rural firefighters. The money would go to State forestry agencies and volunteers, and it was included in the final version of the bill. My language also proposed a Southern Forest Regeneration Center.

The final bill included my provisions to expand the Talladega National Forest into Cherokee County and extend an Alabama trail closer to the Appalachian Trail.

The final bill also included our language to create the star schools program. Through the use of state-of-the-art telecommunications equipment, the Star Schools-Medlink program that was passed in the 1990 farm bill allows small rural schools or hospitals to be linked with the highest quality educational programs and technology developments of other areas. Using this technology in a medical situation, a doctor at a clinic in a rural area could send moving images of a brain scan to a specialist at a hospital hundreds of miles away.

The final bill also included language to provide Federal assistance for rural development, including water and sewers, and a loan program to aid small, rural businesses. There is no one answer that every community can use to achieve economic vitality. However, there are common threads. First of all, the leadership for rural development must be taken to local community organizations--rural electric cooperatives, counties, economic development district, and other local entities. I was especially proud of these provisions as they were included in the final version of the bill.

With Senator Pryor's help, we included language in the 1990 farm bill to authorize $15 million for research on poultry diseases and to require that foreign poultry meet domestic inspection standards. However, President Bush failed to meet this requirement, arguing that it was an impediment to free trade. In fact, he even imposed a 1990 hiring freeze on inspectors.

In 1991, peanut farmers faced another problem when the ITC ruled that 300 million pounds of foreign peanuts be allowed into the American market--a total equaling 10 percent of the domestic market. I contacted the President to protest this ruling, in some large part because it violated language that I included in the 1990 farm bill to require that imports meet the same quality as the domestic product. Chinese peanuts, known to be infected with the striped virus, would be among the imports. Further, allowing such a high number into the country would cost the government $84 million, according to the USDA. Although he reduced the number to 100 million, the President decided to allow the peanuts into the country. In 1993, we contacted the trade representative to urge inclusion of a provision in NAFTA requiring that the stringent domestic inspection standards be imposed on imports.

Although farm bills had always been the result of compromise, and therefore were somewhat less than I had wanted, supporters had succeeded in maintaining the commodity programs at an acceptable level until this year. The 1996 farm bill debate posed a serious threat to the continuation of farm programs, and southern farmers would be especially affected by various proposals.

From the beginning of last year, the Republicans had pushed for elimination of the commodity programs and the price supports. Given the successes of these programs, like the cotton program, I cannot understand the prejudice with which they approached the cuts.

To pass programs that I believe are worthwhile, I have frequently involved myself in the strategy which has worked so well for Senators over the years. To demonstrate this point, when I saw that the cotton program was in serious trouble, I offered by support for other programs to gain backing for cotton. As I told the American Sheep Industry Association in June 1994, there isn't much wool in Alabama, but there isn't much cotton in Idaho or Montana. But if those of us in agriculture didn't work together, we cannot survive the plans to dismantle the fundamentals of farming in this country.

As it came up for review, supporters tried to impress upon Members the importance of the cotton program. The cotton program was designed to meet market conditions in the United States and abroad. In 1995, the year that the Republicans tried to eliminate it, the cotton program proved itself effective. Although there was a bumper cotton crop, the market price remained above the target price. Additionally, we stressed that wheat and feed grains account for 50 percent of all farm program costs, and the cotton program cost only 10 percent of the total Federal farm outlays.

Agriculture had already taken its fair share of cuts. The agriculture budget had dropped from $26 billion in 1985 to just under $10 billion in 1995. However, reductions in the peanut program had never resulted in Americans paying less for their groceries. The cost is always absorbed by someone in the chain between the producer and the supermarket, and economic studies and history do not suggest that cuts would reduce the price now.

With agriculture very much in mind, I voted against the Republican budget resolution. This resolution would have cut $8 billion from farming over 5 years. Naturally, I had other concerns when I decided to oppose the bill including Medicare and Social Security, as well as the idea of promising to cut the deficit and taxes.

After the Senate agriculture committee completed its mark-up on the budget resolution, preliminary estimates for the cuts in the commodity programs totaled $13.3 billion over 7 years. Chairman Lugar's intention was to do his best to eliminate the commodity programs, and he had stated his strong opposition for some time.

Along with others, I continued the fight for the preservation of the cotton and peanut programs. Noting that cotton had enjoyed a record year, I promised to introduce a bill to extend that program as written, with just a few changes.

The average peanut farmer has only 98 acres, whereas the 7 largest corporations that use peanuts to manufacture their products had more than $140 billion in total sales during 1994. It is no coincidence that some Members of Congress who oppose the program just happen to have some of those same corporations in their states. It is these same corporations that stand to be the big winners if the peanut program were eliminated, not the real consumers. The GAO had issued a study which showed that the consumer absorbed a cost of $300-$500 million, but the program's opponents misrepresented this study in the last round, arguing that this cost was passed onto the retail consumer. As a matter of fact, in testimony before the House Agriculture Subcommittee on Specialty Crops and its Chairman, Charlie Rose, the GAO testified that the consumer they referenced was the first purchaser of peanuts, or the manufacturer. They further testified in substance that there was no evidence to support the conclusion that any reduction in the loan rate would be passed along to the retail consumer.

Critics who sought to eliminate the peanut program during the 1995 farm bill debated used this GAO report as one justification for ending the peanut program. Armed with the earlier GAO testimony, representatives from the peanut product manufacturers association were asked if any reduction in the loan rate would be passed to the consumer. They responded by stating that loan rate reductions would not be passed along to the consumer, instead, savings would be used to develop new products.

The peanut program has served to balance the playing field between small farmers and multinational corporations. It is bad policy to eliminate the peanut program only to increase corporate profits at the expense of rural economies and the true consumer who will notice absolutely no difference in the price they pay at the grocery store.

In September, I introduced the Southern Agriculture Act of 1995 to revise and extend the loan and other programs for cotton, peanuts, and oilseeds. Under this bill, the cotton program would have been extended as written. The 1994 crop had been a record crop in production, exports, and total offtake. Many of our competitors had experienced insect infestations causing higher world market prices. As a matter of fact, cotton prices had climbed to their highest levels at any time since the Civil War, topping $1 a pound. Therefore, I saw no reason to alter a program that was functioning effectively. The peanut program would be slightly changed, with a freeze imposed on the support prices at the 1995 crop level. In an effort to address the claims of the peanut program's critics, the National Peanut Growers Group adopted a series of program changes to eliminate all taxpayer costs and open the program to new products. I included many of the NPPA no-net-cost reforms into my peanut title, including eliminating the undermarketings provisions. However, from a strategy perspective, I knew that the farm bill debate would require a great deal of give and take and felt that under no circumstances should we begin negotiating from our bottom line. Since they did not receive price supports, my bill would have extended the marketing loans for soybeans and oilseeds. In addition to extending the marketing loan, we increased the loan rate from $4.92 a bushel to $5.25 a bushel. The lower loan rate had ceased to be an effective safety net for oilseed producers. Our title on oilseeds was heralded by the American Soybean Association as the best proposal put forward for oilseed producers. In the end, a modified version of my proposal was adopted and signed into law.

The reason why I introduced this bill was simply that I utterly opposed Chairman Lugar's farm bill. Among other things, his bill would have destroyed the peanut program. However, I believed that 14 of 18 Senators on the committee favored a peanut bill without a cut in the price support. Because he had such a strong opposition, the chairman employed delay tactics to push the bill back to the reconciliation deadline when the members of the Budget Committee could write the farm bill. These Senators were much less sympathetic to the needs of the southern peanut farmer.

At that time, certain Senators tried to put an additional assessment on peanut producers. They were trying to force the farmer to pay for the entire adminstrative cost of the program. However, the Senators who pushed for this assessment were from wheat States; notably, they did not try to impose the same condition on wheat farmers. However, we secured language which stated that the existing budget deficit assessment paid by producers would be targeted to offsetting program costs and no other assessments would then be necessary.

With regard to the ongoing farm bill negotiations, the Agriculture chairman continued to refuse meetings, despite the strong bipartisan support for the peanut program. He knew that he would not get his way, but that was no reason to keep us from meeting to come up with a budget bill that saved money but did not destroy the peanut program. In the end of committee action that year, the farm provisions included a peanut compromise, but I was never consulted. I was shut out of all discussions about it; the Republicans told me it would be their bill. I could not explain to farmers why these Senators voted for a 7-year program for wheat, corn, rice, sugar, and other commodities, but decided to kill the peanut program after 5 years.

Simply stated, this bill would force a disproportionate share of agricultural budget cuts on the South. It would have its most profound negative effects on new and old farmers there. Most of the growth in cotton production had occurred in the South, but the new cotton program would shut out new farmers from its provisions. This bill required that farmers demonstrate participation in 3 of the previous 5 years in order to continue participation in the cotton program. Many of the new cotton acres in this program were the result of the successful boll weevil eradication program. Land once infested with boll weevils had recently been eradicated, however, the majority of these new acres had not been in the program long enough to qualify under these new rules. Eligibility for participation in the cotton program would be reduced nationally by 30 percent, and in Alabama, 38 percent of cotton farmers would be excluded. Furthermore, Buck Johnson, director of the Federal Farm Service agency of Georgia, estimated that the Senate's version of the reconciliation bill would put 30 percent of older farmers in the South out of business.

In response to being closed out from the historically bipartisan task of writing farm legislation, and seeing the unacceptable changes to the peanut program, Representative Charlie Rose and I introduced a no-net-cost peanut program bill in an effort to preserve a viable program for peanut farmers. It would achieve savings by eliminating the standing 1.35-million-ton floor for the national poundage quota; in fact, the Heflin-Rose peanuts program would have saved $43 million more than the Republican plan contained in the reconciliation bill. Under our no-net-cost bill, the Agriculture Secretary would set this national poundage quota, thereby eliminating undermarketings and limiting disaster transfer payments. By contrast, the Republican plan would reduce the support price and freeze it for 7 years. The USDA estimated that the Republican plan would immediately reduce peanut farmers' income by 30 percent. Not only did it cost more, the Republican plan slashed a peanut farmer's income by $68 per ton. A study by Auburn University on the impact of potential policy changes in the peanut program found that a reduction in the support price to $610 per ton, and a reduction in the national poundage quota to 1.1 million tons, would result in a negative impact of $219 million and a loss of almost 3,000 jobs in Alabama, Georgia, and Florida. The economic impact and job losses are not limited solely to peanut producers. Under this analysis, the wholesale and retail trade, service industries, real estate and financial sectors are especially hard hit. In fact, nationwide, the study indicated total job losses of 5,440 and a negative economic impact of $375 million.

The cotton program in the Republican proposal, too, made no sense. Under its provisions, cotton farmers would no longer be paid for the cotton they produced. Instead, they would sign a production flexibility contract which would subsidize a farmer, whether or not he produces a crop. These decoupled payments would apply to cotton, rice, wheat, corn, and feed grain producers, and they would actually encourage a wheat or corn grower to plant cotton if the world price were high enough to justify the switch. The Republican bill provided for 7 years of narcotic welfare payments designed to bring about the corporate takeover of agrarian America. This Republican proposal would have undermined everything accomplished with respect to farm legislation; it would have eliminated the farmer safety net and disrupted the delicate balance of supply-price stability taken for granted by consumers.

I commend the President for vetoing this bill. It would have created a welfare state. the Republicans claimed that they could lower interest rates by balancing the budget, but ironically, their farm bill raised interest rates solely on CCC borrowers. They also claimed that they wanted farm programs to be more market oriented, but it removed the 8-month-loan extension for cotton. Further, their failure to pass legislation left farmers with no clear direction for the upcoming planting season, and, therefore, banks would not give farmers loans for this year's crops.

At the end of last year, Representative Rose and I introduced another no-net-cost peanut program that would be funded by an assessment on imported peanuts and revenue from NAFTA and GATT. This bill would have maintained the $678-per-pound-quota rate. It would also assure that revenue from NAFTA and GATT would pay for the program rather than reducing farm income. Last, the bill would require that imported peanuts meet the same high quality standards as domestic peanuts, ensuring that they were not grown with chemicals and pesticides banned in the United States.

Clearly, the Congress had failed rural America by not passing a farm bill. By including, historically, stand-alone-farm legislation in the broad Republican proposal to balance the budget, farmers and rural America became hostage to a myriad of issues culminating with a Presidential veto. As a result, farmers were left without congressional direction for the upcoming planting season and were anxiously awaiting a new farm law. This necessity had become most pressing at the beginning of this year. Without a farm bill, the Agriculture Secretary would be forced to implement the 1949 Agriculture Act. That law provided a formula based on parity with the standard of living in 1949. The difference in the value of the dollar and the standard of living between 1949 and 1996 would create an explosion in the price of food.

But fearful of efforts to resurrect the freedom-to-farm bill, I pointed out that its provisions to guarantee payments to farmers whether they produced a crop or not was fundamentally flawed. In times of high market prices, the program would provide a bonus check, and it would not be sufficient in times of low market prices. It is unconscionable to make these kinds of payments in times of high market prices, especially when we are reducing school lunches and other essential programs.

Ultimately, the Senate passed a modified version of the farm provisions that had been contained in the Republican reconciliation bill. I voted for it, because we were able to make marginal improvements in the bill and, therefore, I felt that the good outweighed the bad. Most importantly, the Senate version of this bill reinstated permanent law. By doing so, the inclusion of permanent law ensures that Congress must again address farm laws rather than simply allowing them to expire. Republican lawmakers had intended the decoupled, fixed-but-declining payments to farmers to be the price paid for eliminating farm programs. Congressional Democrats, on the other hand, believed that a stable and abundant food supply to be in the national interest and, therefore, refused to turn our back on American farmers. The inclusion of permanent law was an enormous victory for Democrats thus ensuring our commitment to farming families and the role they play in our society.

Additionally, I was able to beat, soundly, efforts by a freshman Senator to kill the peanut program and to keep a 5-percent penalty for the use of the loan program out of the bill. Opponents of the peanut program had conspired to include this last provision to penalize producers who put their peanuts into the loan. The provision was removed from consideration due to my strong objections.

During conference, the committee fought off a number of detrimental peanut provisions. I successfully fought off a House provision to lower the loan rate another 5 percent if a producer put his peanuts under loan. If this language had passed the rate would have dropped to $579.50 per ton; we worked to maintain it at $610. I also fought off another House provision to allow unlimited cross-county sale of peanuts. Instead, the committee adopted a compromise to allow 40 percent transfers after 5 years. Under the House-passed version, producers would have to pay an additional assessment to cover program costs if any at the end of the year. Further, the shellers' assessment had been exempted by House Republicans from offsetting program costs even though they benefit from the program. However, we were able to arrange this so the shellers' assessment will also go to offsetting the costs, which will protect the producers from having an unlimited possibility for increased assessments. As far as the pool compliance language is concerned, the House bill would exempt the profits from additional peanuts from going to cover peanut program losses. This was changed to the Senate version that would permit additional gains from buyback and redemption to be used to offset program costs. This change would also reduce the possibility of the need for increased assessments on producers.

Problems with the overall farm bill included: It did not provide a safety net for farmers and it made payments regardless of price, but it did give farmers something to work with as they prepare for planting season; the peanut language would cut farmers' income; but cotton came out fairly well, specifically preserving the marketing loan, and back payments would come soon, which would help weather-damaged cotton farmers.

Administration: In the early 1980's, the greatest problem facing farmers was the 20-percent or higher interest rates. Most farmers who borrowed money to finance their crops in 1980 borrowed the money when interest rates were already high, then they lost money because of the drought. I arranged meetings with Reagan's Agriculture Secretary Block to impress this point upon him.

During 1982, I fought the Reagan administration's plan to subject agriculture to FTC control in the Commerce Committee. American farmers were having a tough enough time making ends meet without having to deal with yet another layer of bureaucrats in Washington, DC, meddling in their affairs.

I strongly supported the recent reorganization of the USDA. During 1994, the Agriculture Committee considered a bill to facilitate the reorganization. The bill would reform the administrative functions, and reassign sub-Cabinet officers by mission, reduce the number of agencies from 43 to 29, and it would consolidate country offices in favor of one-stop shopping centers. Through this effort, the USDA hoped to reduce staff and cut costs. Although much of this reorganization could, and did, take place on the regulatory level, the committee wanted to be certain to work out any legislation that might become necessary. Given concerns about the deficit, the time had clearly come to reduce the size and cost of the USDA in favor of a more efficient department. In the final days of the 103d Congress, a USDA reorganization bill was passed creating a more streamlined and efficient Department of Agriculture.

Disaster aid/crop insurance: I have always done my best to pay attention to the needs of farmers in times of natural disasters in Alabama. In 1979, we had a drought and Hurricane Frederick. In 1980, we had an even worse drought. In 1982, interest rates forced me to request Agriculture Secretary Block to initiate the Economic Emergency Loan Program. The same year, I urged Block to change a FmHA regulation requiring the rescheduling of loan at the cripplingly high rates of the day. I testified before the Forestry Subcommittee to warn of the impact of these rates. In 1982, I also fought to save the NWS agriculture program during Commerce Committee action. The farm weather forecasting service saved American farmers more than $750 million each year in the production costs of the major agricultural commodities of cotton, corn, soybeans, livestock, wheat, and rice, but it only cost $1.2 million. The committee approved a bill I cosponsored to combat these high interest rates on farms. The bill would extend the economic emergency loan program for a year and create an individual evaluation program to reschedule existing FmHA loans at their original interest rates, rather than the high rates of 1982. I also called a farm crisis meeting in Montgomery to discuss interest rates and other problems facing the State's farmers. In 1983, the FmHA ran out of money to pay for its operating loans in 17 States, including Alabama. I urged the USDA to reallocate the money, threatening legislative action, the USDA complied. Spring freezes also plagued farmers in 1983. Near the year's end, I sponsored a measure to disregard payment-in-kind acreage in eligibility determination for natural disaster emergency loans. The existing program required that a farmer suffer a 30-percent loss to be eligible. However, payment-in-kind acreage would not count in these estimates, so they were frequently inaccurate. In 1984, the Senate passed a bill I cosponsored to establish a 15-member special task force on agricultural credit to ensure its availability at reasonable interest rates. I noted a survey of bankers, many of whom believed that farmers would default on their loans. Further, 100,000 farmers would be forced out of business that year, and the statistics indicated that half of family farmers would disappear in less than a generation. In 1985, I emphasized the farm credit crisis in the country, with a farm debt the size of the Federal deficit; the FmHA had not acted to combat the problem--it had $630 million available for Federal loan guarantees but used only $25 million. That same year, I met with Willie Nelson to advise him on how to distribute the proceeds from FarmAid. We had another drought in 1986, which spurred me to begin hearings to investigate drought cycles in the South and possible ways to handle them.

In 1987, I introduced a bill to save the farm credit system. It would have authorized bonds and the restructuring of the system, including a cooling-off period before mergers went into effect. It would protect important farmers' stockholdings in the system and establish an assistance board to financial institutions providing farm loans. I introduced another amendment to protect advanced payment for prepayment accounts held by Federal land banks, part of the farm credit system. The amendment would simply have required that money deposited into these advanced payment accounts would immediately, prior to the capital depletion or insolvency of a Federal land bank, be applied as payment against the borrower's loan.

Alabama suffered another drought in 1988. I introduced a drought assistance bill to mandate emergency aid from the Secretary of Agriculture. The bill also included a private water project. It would have created water cooperatives financed by loans or bonds to transport water for irrigation. When conferees finished their report, I criticized their changes to the feed and livestock provisions, but I was pleased that the House had not weakened the peanut provisions.

In 1989, I pushed the Air Force to track hurricanes in the gulf and Pacific coast States; Hurricane Frederick in 1979, for example, had caused relatively little property damage and loss of life because of advanced warnings. The Air Force agreed to retain the WC-130 program.

In August of that year, the Senate approved the Rural Partnership Act of 1989. The bill strengthened Federal support of State and regional economic programs, or rural electric cooperatives, and of land grant university research and extension programs. It was only a modest beginning, but it might be a great help to rural communities.

That same month, the Senate also approved a disaster relief bill. Alabama had another drought in 1990. And we had an unusually rainy spring in 1991. With Senator Cochran, I introduced legislation that year to force the President to provide emergency funding. The USDA had made money available through FmHA loans, but the President had not delivered it according to his authority provided by a 1991 supplemental appropriations bill. In the fall of that year, I supported the passage of a bill to provide aid through FEMA. This bill included language practically identical to language I introduced during the 1990 farm bill debate to make 65-percent payments to farmers who had suffered 35 percent or more in losses. After continued contacts with the President, he finally released the disaster money in 1992.

Winter storms and flooding, as well as a number of tornadoes, plagued the State in 1994. Tropical storm Alberto also caused a great deal of flooding that year. I also pushed the disaster assistance amendment to include funding for flood victims in Alabama, Georgia, and Florida in the fiscal 1995 agriculture appropriations. I also pushed a bill I sponsored to authorize funding for flood relief through the Agriculture Committee. The Senate passed this measure unanimously. In fact, the vote on flood relief compelled me to miss my chance to act as the President's personal representative on the 50th anniversary of the liberation of Guam; I had served as Marine lieutenant and I was one of the first on the beaches. In 1995, I asked the USDA to extend the Federal crop insurance deadline; there were a number of farmers who had not applied. The USDA established this deadline under the previous year's crop insurance bill, but it would not help any farmers who had not applied; they would no longer be eligible for disaster payments. With the passage of Federal crop insurance reform late in 1994, the program signaled a break from the routine of passing disaster bills. With this new program and approach, I knew there would be a period of adjustment. I believed that it was a reasonable request given that Congress had only months before passed the crop insurance reform and USDA had not fully implemented the program while expecting farmers to educate themselves and embrace the reforms in a very short period of time. The least that could be done was extend the crop insurance sign up deadline and allow farmers adequate time to inform themselves of these significant changes regarding disaster assistance.

Hurricanes Erin and Opal passed through Alabama in 1995. I cosponsored a Cochran bill to authorize the Agriculture Secretary to provide supplemental crop disaster assistance in addition to benefits provided by the Crop Insurance Reform Act of 1994. Cotton producers had been plagued by a severe drought and worm infestations during the 1995 crop. This was particularly disappointing due to the fact that 1994 was a record year for the U.S. cotton crop. Expectations were high for 1995 and nationwide plantings were up by as much as 20 percent in some States. While the drought contributed a great deal to the 1995 cotton disaster, the insect infestations were particularly devastating. The insect situation was so bad that the EPA authorized the temporary use of the insecticide Pirate to fight the tobacco budworm and beet army worm.

The final blow to cotton farmers was Hurricane Opal. After already experiencing terrible growing conditions in 1995, just prior to harvesting what cotton that was left, Opal took care of the cotton that the drought and insects had not.

Hurricane Opal was a devastating storm, not only for its timing regarding cotton farmers, but for all Alabamians in southeast Alabama. Opal caught a great deal of structural damage and produced a large amount of debris. Fortunately, we were able to successfully petition the USDA for assistance under the Emergency Conservation Program [ECP]. Under the ECP, Alabamians received approximately $5 million in assistance for debris removal and structural repair.

In an effort to address the problem of annual disaster assistance bills, and provide a model for crop insurance reform, in 1993 I began meeting with grower groups to hear their ideas on an effective system of crop insurance. In this endeavor, the National Cotton Council was particularly helpful.

The message from farmers was that the cost of production was continuing to rise, cotton prices were declining or flat at best, and disaster assistance was triggered only by production or yield losses.

As a result of these roundtable meetings, I introduced the Farmers' Risk Management Act of 1994. This legislation called on the Federal Crop Insurance Corporation to offer producers the option of a cost-of-production system which would be based upon each individual producer's actual cost of production. This bill would have also allowed a producer to choose between using his actual yields and his farm program yields in determining his crop insurance yields. Many of the ideas put forth in this legislation were rolled into the Federal Crop Insurance Reform Act of 1994. As a matter of fact, the Heflin proposal on a cost-of-production system was used to design an income-protection pilot program that is being implemented this year.

This new approach will cover farmers when gross income falls below established limits. This pilot program creates a system that would guard against yield losses and low harvest prices.

The implementation of this pilot program could not have come at a more important time. This first year's experience with the catastrophic coverage under the new crop insurance reforms has proven to be inadequate. More importantly, though, after the 1996 farm bill and its uncertain future effects on American farmers, we find ourselves faced with the possible phase-out of farm programs. It is, therefore, absolutely essential that we have a reliable crop insurance plan that will provide some type of safety net for producers. The significance of this new approach is that it addresses fluctuations in price, where the current crop insurance program only takes into account losses from reduced yields.

I am proud of these efforts made on behalf of trying to forge a new and more effective direction in regard to crop insurance. It is my hope that this pilot program will grown and be implemented on a national level.

In 1984, Senator Hollings and I introduced a bill to create a national storm-scale operational and research meteorology [STORM] program to update the country's extreme weather prediction systems. With this bill, we sought to emphasize the transition from the old radar systems to the implementation of the new NEXRAD system. This bill passed the Senate, but it died in the House. Senator Hollings and I reintroduced this bill in 1986 after NASA lost a weather satellite. Our resolution would also have urged the administration to launch another GOES satellite and increase weather reconnaissance flights in the interim. The Commerce Committee passed this resolution in June.

In 1990, the battle to preserve Huntsville's weather station began; the NWS had proposed dropping the weather station serving northern Alabama in the implementation of its NEXRAD system. That year, I met with the Deputy Director of the NWS to urge him to consider Huntsville's proposal to donate a weather radar system. I continued this fight in 1994, making certain to be continually in contact with the NWS and the NOAA to advocate maintenance of the Huntsville facility. In 1994, I also contacted the Vice President to solicit his help in the continuation of the Huntsville National Weather Service Radar. I told him that I believed eliminating the station under NEXRAD would leave northern Alabama and southern Tennessee in a vulnerable position. That same year, I extracted promises from the Director of the NWS, Dr. Elbert Friday, to push back closing of this doppler radar station. I also introduced the Weather Service Modernization Review Act of 1994 to require a study on the potential impact of closing weather stations. The Vice President ordered the study by the National Research Council. This study revealed that the Huntsville area would, in fact, suffer from the lack of its own NEXRAD station. In 1995, I cited this study, and contacted the committee chairmen who oversaw the NOAA and the NWS: Gramm, Pressler, and Hollings. The Commerce Committee approved an amendment to the Weather Service authorization to make it more difficult to close 32 weather stations, including the Huntsville station. I also contacted the Secretary of Commerce to advocate a new station in the Huntsville area; he promised to install a center in northern Alabama. After his death this year, the NWS announced that it would honor its commitment to install that center.

After a number of tornadoes in northeast Alabama in 1994, the USDA and I jointly announced that the NWS' All Hazard Weather Radio Network would put up a station to provide early warnings in the area. I had toured this area, including Goshen and its United Methodist Church--which had been destroyed by the storm--with Vice President Gore, where I solicited his support to deal with such problems in the future. However, I was concerned about the performance of early warning systems in the State after more tornadoes hit Arab and Joppa the next year.

In 1995, I supported a Cochran amendment to the Commerce, Justice, State appropriations bill to restore funding for the agricultural weather service centers at Stoneville, MS, and in Auburn. Weather is the single most important external element in the production equation. But this year, as the deadline for these centers' cutoff approached, I met with NWS officials to discuss forecasts in the future. With Representative Browder, I pushed for continuation of these ag forecasts by transferring the NWS over to the USDA. Despite Senator Cochran's support, who realized the importance of specialized ag weather forecasts, the Republican agenda of the 104th Congress called for downsizing the Federal Government and this vital service fell prey to privatization.

An action I am most proud of in the field of research is the passage of a bill that I authorized making it a Federal crime to vandalize, destroy or make unauthorized use of animal research facilities, including data, equipment and the animals themselves. The Animal Research Facilities Protection Act, which was signed into law as the Animal Enterprise Act would impose severe penalties on individuals or groups who interfered with medical and other research facilities where animals are use.

Unfortunately, some groups are so opposed to the use of animals in this essential research that they set fire to research facilities or break into laboratories to steal animals and destroy equipment, records and research data. The real price of these types of crimes are paid by all those who are waiting for cures and treatments for their afflictions. Research into Alzheimer's disease, cancer, AIDS, substance addiction and mental health were at stake here.

Public interest in animal welfare should be encouraged. Research utilizing laboratory animals has led to many of medical history's most significant breakthroughs. These animals are used only when necessary and should be housed, handled and treated humanely. Those who disagree with the responsible use of animals in research do not have the right to take the law into their own hands.

While a few States have already enacted laws increasing penalties for crimes against research facilities, I felt it was necessary to establish protections on the Federal level.

In 1862, the U.S. Congress passed the first Morrill Act which provided for the establishment of land-grant institutions in the Southern and border States. These institutions were designed to educate citizens in the field of agriculture, home economics, the mechanic arts and other practical skills. Since the Southern States were uncooperative in funding historically African-American institutions under this law, Congress passed a second Morrill Act in 1890, creating the 1890 land-grant institutions.

Alabama has two 1890 land-grant institutions, the Tuskegee Institute and Alabama A&M. Tuskegee was created by an act of the Alabama Legislature and granted land by the U.S. Congress.

Although the 1890 institutions were chartered more than 100 years ago, a stream of ``hard'' money for research was not created until fiscal year 1967. The Tuskegee Institute was not officially a land-grant college, but in 1980, I was able to have the Tuskegee Institute added to the permanent list of 1890 institutions and ensure there would be a continuous stream of Federal research funds. Further, Congress created the Chappie James Center at Tuskegee with the 1890 reauthorization of the Higher Education Act of 1965, and it ensured funding for each of these institutions with the 1981 farm bill.

I have worked closely with Alabama's 1862 land-grant institution, Auburn University, over the years and the 104th Congress was no exception. I was especially successful in completing, or continuing, funding for several very important research initiatives through the college of agriculture and the Alabama Agriculture Experiment Station in cooperation with the Department of Agriculture.

Funding for the completion of the new poultry science facility at Auburn was achieved in the fiscal year 1997 agriculture appropriations bill. This $12 million facility will provide a state of the art facility for essential research into one of the most important agriculture sectors in Alabama, the poultry industry.

I was also successful in securing funds for continued water quality research conducted at the Alabama Agriculture Experiment Station. The research involves a team effort by scientists at Auburn and other land-grant universities, the CSREES, the TVA, State and private agencies, and most importantly, the producers. New technology is implemented immediately, which enhances the development and growth of agricultural industries. The water quality research also addresses problems that confront rural development and the sustainability of agricultural enterprises. Most importantly, though, this research is responsible for developing and implementing water and crop management practices that both enhance agriculture production and protect and preserve an important natural resource--water.

One specific example of this is the irrigation project being conducted at the experiment substation in Bell Mina, AL. Increased demand for irrigation water in the southwestern United States is causing increased stress on many streams where farmers are pumping directly from the stream. As a possible method to decrease this demand during periods of low stream flow and to make more water available for irrigation, a study was initiated to evaluate the feasibility of pumping during high stream flows to off-stream storage sites. These sites could be on-farm or farmer-shared reservoirs. The irrigation reservoir at Bell Mina has been completed and the early results appear promising.

The National Soil Dynamics Laboratory at Auburn conducts research designed to solve soil management problems. Developing effective methods of managing soil to maintain its quality, and to improve the quality and productivity of degraded soil, requires a multidisciplinary program. One component of this research being conducted at the soil laboratory is the agronomic portion. House appropriators eliminated funding for this component in their agriculture appropriations bill. Fortunately, I was able to have this funding restored in the Senate bill. The agronomic portion of the multidisciplinary program at the soil lab is vital because it is the very portion that facilitates the technology transfer from the lab to the field.

I fought for continuation of TVA's National Fertilizer and Environmental Research Center after the Clinton administration had targeted it for elimination. The administration argued that this research should be conducted privately. But I contacted the VP and the Budget Director, and it was simply a matter of explaining that NFERC was an up-and-running research center that was already accomplishing many of the environmental goals set by the administration. Once this was laid out for them, they saw that it made no sense to kill a working program in order to create new programs with similar goals.

I also introduced a bill to transfer aquaculture from the Interior Department to the USDA. This was a long-overdue streaming measure that will greatly improve the overall efficiency and timeliness of aquaculture research. Specifically, it saved the Southeastern Fish Cultural Laboratory in Marion by moving it from Interior to the USDA. It was adopted in the most recent farm bill. The U.S. aquaculture industry has grown more than 15 percent annually since 1980. As a result, aquaculture has emerged as a solid alternative for farmers and allowed them to diversity. In fact, aquaculture is of vital importance to the economy of west Alabama. Over 20 percent of the area's population is employed directly in the production or the processing of catfish.

While commodity programs seem to dominate agriculture policy, rural development policy is an area that I have paid special attention to. This is particularly true with regard to rural electrification.

Most recently I authored the Rural Electrification Loan Restructuring Act of 1993 which was signed into law on November 1, 1993, as Public Law 103-129.

This legislation eliminated the authority of the REA Administrator to make 2 percent loans, established criteria for a REA electric distribution borrower can qualify for a 5 percent loan, and authorized the Administrator to make loans at the municipal cost of capital. This legislation also addressed high density cooperatives, rural development eligibility, and private capital requirements among other things.

In the 1996 farm bill, I was instrumental in securing additional loan restructuring authority for the Secretary of Agriculture regarding rural electric loans. We are currently working with the USDA to promulgate regulations that will provide the Secretary with sufficient flexibility to carry out the intention of Congress.

As part of the Republican plan to balance the budget, Republicans proposed selling off the Power Marketing Administrations, which provide electricity to regional distribution cooperatives. The primary concern with this proposal was that PMA ``purchasers'' would have to increase the price at which they made electric power available in order to recover their purchasing costs. I believed strongly that this would ultimately translate into higher utility costs for end-users of rural electric cooperatives.

With this issue being debated in the Energy Committee, when a seat on the committee became available, I returned to the Energy Committee and assisted in preventing this proposal from being made a part of the Republican reconciliation bill.

In 1981, I applauded the President's decision to lift the Soviet grain embargo. I did believe that the United States needed to take action against the Soviets for invading Afghanistan. However, it is most regrettable that the farmers of the United States have had to bear the cost of this foreign policy instrument alone. For that reason, in 1982, I urged the President to develop a long-term, Soviet grain agreement. I advocated ending grain embargoes and working to expand export markets, including multiple year extensions of trade agreements. A 1-year extension has the effect of a defacto embargo because it keeps the specter of an embargo looming over the whole grain growing and exporting industry. The mere threat of an embargo keeps grain prices depressed and plays havoc with the entire farm economy. In 1983, after the downing of the Korean jetliner attack, I feared that the President would impose another embargo on the Soviets, so I introduced a bill to create a state undersecretary for agricultural affairs. It seemed that increasingly our agricultural policy is being set by officials of the State Department as they respond to international events. In 1984, the Senate passed a bill I cosponsored to require congressional approval of trade embargoes. It would require that both Houses approve an embargo within 60 days and review it every 6 months. There was no doubt that past embargoes, and the threat of new embargoes, significantly contributed to the erosion of U.S. export dominance and the resulting decline in farm income.

In 1983, when the President was preparing to visit Japan, I sponsored a sense-of-the-Senate resolution to urge that United States negotiators should insist that Japan dismantle all of its barriers on imported beef. This resolution passed. I urged the passage of a similar resolution in 1984. In 1988, the beef agreement with Japan expired, and negotiations stalled.

Then an unusual series of events occurred. The Japanese Ambassador asked me in my capacity as chairman of the Subcommittee on Courts of the Judicial Committee to pass a courts bill allowing the use of Japanese language interpreters in Federal court cases. We succeeded in getting the necessary legislation approved. The Ambassador thanked me and then asked me if there was anything he could do for me. I replied I would like to meet with the Japanese Minister of Agriculture, trade representatives, and two members of the Diet. I was able to bring representatives of the National Cattlemen's Association to the meeting. We had a very frank discussion and reported the progress to the U.S. trade representatives. Fortunately, a few days later a very favorable trade arrangement was worked out and American beef was allowed to be exported to Japan in far greater numbers than before. The arrangement further eliminated the quotas after 3 years, at which time the Japanese could impose tariffs if beef passed trigger levels.

I have been concerned about poultry exports for some time. In 1983, I wrote to the trade representative to urge him to address Brazil's increase in poultry exports. From 1976 to 1980, the U.S. share dropped from 20 percent to almost nothing. Since Brock did not act, several other Senators and I contacted the President directly, noting that the U.S. share of the world poultry market had fallen from 97 percent to 13 percent over 20 years. To address these concerns, I attached a poultry export marketing program to the Agriculture Committee's payment-in-kind bill. This bill was designed to open new markets and recapture old ones.

In 1984, I joined several other Senators to urge the President to negotiate with the Canadian Prime Minister to address hog trade. Legislation was before the Congress to impose duties, we informed the CPM, and their exports to the United States had risen 10 times. In 1985, I pressed this point again. Disputes with Brazil over poultry, China over cotton, and Australia over beef, combined with this trade imbalance had clearly demonstrated that the United States needed to put an end to the use of unfair subsidized competition and to recoup its fair share of world export trade. I was pleased that the Commerce Department acted to impose duties on Canadian pork. I also wrote to the Trade Representative in 1994 to urge him to seek Canadian compliance with the terms of NAFTA. I also joined Representative Rose to urge an ITC investigation of dumping of Canadian peanut paste in the United States.

When the United States began to consider food aid to the Soviet Union in 1990, I encouraged the USDA to aid that country by developing food distribution practices rather than simply granting money. The precedent for such aid was the food for progress program created in the 1985 farm bill and successfully implemented in the Uruguay round. But as the situation became more severe in the Soviet Union, I urged the Agriculture Secretary to provide emergency, ready-to-cook provisions. People were in desperate need of immediate help, and raw commodities like grain would not be as helpful. I did, however, remind the Secretary that the aid would need to be provided as a credit, not a grant. I also urged the Agriculture Secretary not to abandon United States textile bags in this Food for Peace Program; that decision would have resulted in the loss of American jobs in favor of Chinese slave labor. I also advocated sending peanut butter and other peanut products to Russia, which was looking for a cheap meat substitute.

This year, I urged the President to resolve the trade dispute with the Russians when they announced that they would no longer import United States poultry. The Russians had refused to recognize the United States system of poultry inspection. Along with several of my colleagues, we urged President Clinton to carry this issue to the highest levels of the Russian Government. While in Russia, Vice President Gore and Secretary Glickman raised this issue and soon afterward, an agreement was reached. The poultry industry is extremely important to the economy of Alabama. It accounts for 54 percent of all farm income in the State and 75 percent of farm exports.

In conjunction with other Senators from poultry producing States, in the 104th Congress we also had to fight barriers to interstate free trade. The current regulation regarding the labeling of ``fresh'' poultry states that poultry preserved above zero degrees fahrenheit shall be labeled fresh, and poultry below zero degrees, the point at which animal flesh freezes, shall be labeled frozen.

The USDA, on behalf of California poultry producers, promulgated regulations to raise the benchmark for fresh to 26 degrees based on the premise of consumer claims that the current regulations for poultry labeling was misleading.

We were able to demonstrate, however, that this was actually an effort by the California poultry industry to erect a barrier to shipments of poultry from historic poultry producing regions, specifically the Southeast. I obtained a copy of a report by the California Poultry Working Group, an industry panel designed to study and make recommendations on the California poultry industry, that stated in its findings that the single, most significant barrier to industry growth was the high cost of poultry production in California. On the other hand, poultry producers in the Southeast are able to produce broilers and ship them to other parts of the country at a profit.

With Senator Cochran's leadership, we were able to block the implementation of this new regulation in the fiscal year 1996 agriculture appropriations bill. During negotiations on the fiscal year 1997 agriculture appropriations bill a compromise was agreed to. Ironically, the compromise was essentially the same proposal that I put forward a year earlier. Nevertheless, it was a deal that Southeast poultry producers could live with.

In addition to rewriting farm policy, the 104th Congress made substantial progress in other areas under the agricultural policy umbrella. Earlier this year, the Congress passed and the President signed H.R. 2029, the Farm Credit System Reform Act of 1996. This important legislation brought a degree of regulatory reform to the Farm Credit System Banks while also addressing needed charges in Farmer Mac and resolving the FAC debt issue.

Of major significance, Congress finally broke the logjam that had lasted for nearly 2 decades and passed legislation to rewrite Federal pesticide laws, bringing about much needed reform of the outdated Delaney clause.

The Food Quality Protection Act, H.R. 1627, received unanimous support once all the pieces of the puzzle were put into place. Traditionally, the battleground between industry and environmental supporters, the urgency to resolve pesticide legislation was created by court rulings that would have ordered the EPA to begin canceling the use of some common chemicals.

The bill as signed into law will revise pesticide registration under the Federal Insecticide, Fungicide, and Rodenticide Act of 1947, speeding up some EPA registration procedures. The bill also recognizes separate registration procedures for minor use chemicals, and under legislation I coauthored, antimicrobials, or common household and industrial chemical cleansers.

Most importantly, this legislation reformed the notorious Delaney clause of the 1958 Federal Food, Drug, and Cosmetic Act, which barred processed food from containing even minute amounts of cancer-causing chemicals. The hard-fought compromise of the Delaney reform will impose a safety standard to ensure that pesticide residues on both raw and processed food pose no reasonable risk of harm. This standard essentially means that there will likely be no more than a one-in-a-million chance that a residue would cause cancer. The old standard was completely outdated, given modern technology, that prevented some chemicals from being used that actually reduced the natural level of carcinogens in many commodities. This is an important reform and I am glad that we were able to achieve this victory this year.

While there were some victories over the last 2 years, there were also some defeats and close calls. I have long been a supporter of private property rights legislation. As a matter of fact, the only private property bill to pass the Senate in the 103d Congress was the Heflin-Dole private property bill. I am sorry to say that the effort to pass private property rights legislation failed in this Congress. I also regret that attempts to move regulatory reform legislation were not successful.

As I close out my career in the U.S. Senate, I reflect back on all that has been accomplished. With regard to agriculture, I am extremely pleased and proud of the progress made on behalf of rural America and family farms.

Over the last 18 years, I am proud to say that I have been a part of working to ensure that electricity and water and sewer systems were extended to areas where they once were not. We have strengthened the family farm by providing adequate capital to farms and agribusiness. We have passed farm bills that have stabilized the family farm, made the American farmer the envy of the world and at the same time, protected the environment and reduced the deficit. Through the work on the Agriculture Committee we have extended technological advancements into rural America through telemedicine and distance learning initiatives. Foreign markets for U.S. agricultural products have been opened wide and agricultural research has led to more efficient farming with breakthroughs such as no-till agriculture and precision farming employing satellite imagery.

While a great deal has been accomplished, I am still concerned about what the future may hold. As the American society continues to become more urban, fewer and fewer have an appreciation for issues affecting rural America. Furthermore, I believe that most take for granted that only 3 percent of the American population, in addition to feeding the world, provide this country with the highest quality, most abundant and affordable food supply of any nation in the world.

The 1996 farm bill, which is a major departure from traditional farm programs, leaves an uneasy feeling for the future. Although it was ostensibly designed to bring certainty to farming, I believe the 1996 farm bill created many potential problems that we may not even be aware of for some years to come. Specifically, I believe decoupling payments from market prices was a mistake. Only time will tell, but I hope that there will be Members of Congress who are sympathetic to the needs of rural America should the Freedom to Farm proposal fail.

I am also concerned about the state of the cotton industry. I have been contacted recently by sectors of the industry raising concerns about the growing volume of cotton imports into this country. This is something that I plan to monitor in the near future. Also, I am curious to see the effectiveness of the bioengineered Bt cotton seed. Bt cotton was engineered to be resistant to insects. To date, reports indicate a great deal of success with this new cotton. I will be curious to review results after the current harvest is complete,.

Farming families and rural communities are the backbone of this great Nation. I am proud to have served on their behalf on the Agriculture Committee for 18 years. As I return to Alabama and the many farmers in northern Alabama, I will continue to meet with, and monitor, the state of U.S. agriculture and the proud farmers who produce our food and fiber. It is my sincere hope that those who remain in Congress, and those to come, will give the proper consideration to rural issues as they come before this body. Mr. President, back on August 20, 1996, the Alabama Peanut Producers held a dinner in my honor. I was very thankful and humbled by their outpouring of affection and humor that evening.

One of the most memorable and humorous speeches was one given by Texas Congressman Charlie Stenholm, a long-time friend and colleague. I have had the pleasure of working with him over the years on many agricultural issues, particularly those relating to the peanut program. Should the Democrats regain the House majority this fall, Charlie will probably be the Agriculture Committee's new chairman.

I ask that a copy of Congressman Stenholm's remarks be printed in the Record. It gives an entertaining and humorous inside account of some of our behind-the-scenes battles on these important issues over the years.

The material follows:

Senator Heflin was elected to the United States Senate in 1978, and begin serving on the Senate Agriculture Committee just as the committee began work on the 1981 farm bill. Everyone knew the '81 bill would be a challenge, the Republicans had just taken the White House and the Senate. Senator Richard Lugar became the Chairman of the Senate Committee on Agriculture. The Indiana Senator was not known for his support of the peanut program. Those present at the time and involved in the development of the farm bill remember that then Freshman Senator Howell Heflin took a particular interest in the peanut program. One producer representative, Larry Meyers, has commented that in his 24 years in Washington, Senator Heflin was the only Senator who, when asked to support the program, made Larry sit at the Senator's desk while he went through the entire bill, discussing even the proper placement of commas and semicolons, to ensure the bill reflected truly what was best for peanut growers. That kind of detail and preparation has made Senator Heflin a formidable foe on the Senate floor for those who sought to end the program. A couple of interesting stories came out of that 1985 farm bill period. Early in the farm bill process, another new Senator and now Governor of California Pete Wilson tried to offer a difficult to understand amendment affecting a small crop in California. It was just before lunch, members were anxious to adjourn the meeting and there was little interest in the amendment. When Senator Wilson finished offering his amendment, there was an awkward silence when no one seconded the amendment. Suddenly, just before the Chairman was about to rule the amendment out of order and adjourn the committee for lunch, Senator Heflin suddenly spoke of the amendment's outstanding merit and seconded the motion. With that, the Committee quickly approved the measure and adjourned for lunch. Senator Wilson quickly left his seat and came around the table to say thank you to Senator Heflin, who he admitted he really did not know since they were both new to the committee. Senator Heflin replied to Senator Wilson with a smile and a wink, ``Senator, we don't grow your California crops in Alabama, but we do grow peanuts!'' Senator Wilson got the message, and later voted in support of the peanut program. At another point about this time, then Secretary of Agriculture came before the Senate agriculture committee to promote a new program called ``P, I, K'' or Payment In Kind. After the Secretary finished testifying in favor the PIK program, Senator Heflin questioned the Secretary with a long inquiry wherein Senator Heflin clearly referred to the program as ``P, I, P'' or as the ``PIP'' program several times. In responding to the Senator, Secretary Block first tried to correct Senator Heflin, ``It's the P, I, K program, Senator, PIK!'' Senator Heflin paused for a dramatic moment and replied, ``Oh, I thought you said P, I, P, the Pig in a Poke program.'' The room roared with laughter, and everyone understood Heflin's attitude about the proposed new program. On a more serious note, there can be little doubt, that, over the years, Senator Howell Heflin has been ``Mr. Peanut'' in the Senate, and the real reason the program has enjoyed such strong support over the years in the Senate. It was not always that way. During the debate on the 1981 farm bill when the Senator was still new in the Senate, then Committee Chairman Richard Lugar offered in the Senate a motion that effectively killed the peanut program. In a dramatic, difficult vote, the Senate approved Senator Lugar's motion. There was then a pause in the deliberations when Senator Heflin and Senator Warner of Virginia got all the peanut representatives and farmers that were in Washington for the Farm Bill debate into a room to discuss what to do next. Everyone agreed the peanut acreage allotment program was dead, but if another type of program could be designed in a matter of minutes that would keep peanut farmers in business without allotments, perhaps the Senate could be persuaded to accept some type of new program. Mr. Ross Wilson, a strong admirer of Senator Heflin and the manager of the Southwest Peanut Grower's association sat down with the peanut leadership present, and wrote out in longhand on a yellow pad what is essentially the poundage quota program we have today. Senator Heflin and Senator Warner then took that yellow pad to the Senate floor and passed a new peanut program. It was a dramatic moment. It meant hundreds, if not thousands of small farmers could stay in business, and it came about because Senator Heflin was willing to stand up with farmers. And as a result, you can say Senator Howell Heflin is, ``The Father of the Modern Peanut Program.'' In the ensuing years, during farm bill debates and even during appropriations considerations, the peanut program has been attacked several times, But each time, we had a peanut leader in the Senate: Senator Howell Heflin would stand and defend the program strongly as he did this year, and each time, those attacking the program suffered defeat and the peanut program continues. We owe him a great deal of appreciation. Yes, although it can be said Senator Heflin saved the peanut program repeatedly over the years, but in addition, there are several provisions of the peanut program we can look to and know that they developed directly by the Senator: The support price escalator based on the cost of production we enjoyed since 1985 until this year; the three marketing associations being written clearly into the law; and dozens of smaller provisions that have made the program work more efficiently and at lower cost to the government. In addition, and perhaps most significant, and something I have personally witnessed, has been Senator Heflin's work in Conference. After the House and Senate pass a bill, there are almost always differences that must be resolved in what we call a ``Conference''; a meeting of members to iron out the differences and come up with language both Houses will approve. This is where Senator Howell Heflin has been of most value to this industry, particularly this year when we had to make the most of a bad situation. Charlie Rose and I always knew, if we lost an important provision, Senator Heflin would put it back in, or if we could get a new provision, Senator Heflin could keep it in when the bill came to conference. This year it was particularly true when you can credit Senator Heflin with killing the 5-percent penalty for loan peanuts which would have hurt every peanut farmer in this country. It was fun to watch: When the debate got heated, if you saw Senator Heflin lean back in this chair, slowly push the plastic back on his cigar and begin to chew, you knew he was thinking and was about to close in for the kill--this year on the Republican Leadership that was seeking to decimate the program. I know you are not fully happy with the program the way it turned out in the end, but we got one. And the challenge can be summed up with the remark that Senator Richard Lugar was heard to make after the farm bill conference: ``In looking at this language, I can see that once again, Senator Howell Heflin has prevailed over those of us who sought to end the peanut program.'' Senator Heflin, that is a fitting tribute. Congratulations, and thank you.