Opening Statement: Chairman K. Michael Conaway (R., Tex.)
Committee on Agriculture Hearing: State of the Rural Economy
February 11, 2015
Remarks as prepared for delivery.
“Thank you Mr. Secretary for appearing before the Committee today. You are a very busy man, so we appreciate you taking the time to be here with us today. You have long enjoyed a good working relationship with this Committee, including with our previous Chairman, Mr. Lucas, and I look forward to continuing that tradition going forward.
Saturday marked the one-year anniversary of the signing of the Agricultural Act of 2014. As you know, economic conditions for many producers have changed dramatically since then, with commodity markets plunging by up to 50 percent. Drought and other natural disasters also resulted in disaster declarations in 33 states across the country last year. The net effect was an estimated 43 percent decline in net farm income over the past 2 years.
A good many producers are struggling to demonstrate to lenders that they can cash flow in order to secure credit and farm for another year. Adding to the anxiety of producers is the implementation of the Farm Bill where hard decisions with very significant consequences will have to be made in the coming weeks.
While the agricultural economy has been turned on its head, Mr. Secretary, you and your team have been hard at work implementing the 2014 farm bill, and I want to publicly thank you for the work your team has done thus far. I also want to thank you—and RMA Administrator Brandon Willis in particular—for your dogged determination in getting the APH Adjustment—now called the Yield Exclusion—implemented in time for spring-planted crops. That was a significant lift, and it did not go unnoticed.
While there have been a few bumps along the way—and to be certain, challenges remain—you and your team deserve to be commended for your work.
While I thank you for your hard work implementing the farm bill—including several improvements made to crop insurance—I must admit that I was disappointed to see the administration’s FY2016 budget proposal that slashes $16 billion from crop insurance—a reduction of over 17%. With commodity markets plummeting and producers struggling to find financing, now is precisely the wrong time to weaken crop insurance.
I would also note that, despite the economic turbulence in rural America, the Commodity Title of the Farm Bill is still slated to save taxpayers money relative to the old Direct Payment, and the cost of Federal Crop Insurance is also expected to decline. Moreover, overall Farm Bill savings anticipated during the Farm Bill debate remain intact under the January baseline.
We are at the beginning of a new Congress and a new year. And just like farmers don’t know what the year will bring in terms of weather and markets, we too can’t predict the twists and turns of the political process. But what we do know is that hard work always finds its reward. To that end, my colleagues and I look forward to rolling up our sleeves and getting to work.
Mr. Secretary, again thank you for being with us today. I look forward to your testimony.”