Kent Conrad

Mr. CONRAD

Mr. CONRAD. Mr. President, again, I want to indicate the facts. For those who have said crop insurance is the answer, crop insurance will keep these people from dramatic losses--wrong. That is not true. This bill will not prevent farmers from dramatic losses. If they have had a 50-percent loss, even with this legislation, they are going to lose nearly 30 percent. If they have had a 75-percent loss, even with this legislation, even with crop insurance, even with buying up to the level that is the most frequent level that farmers buy, they will have a loss of nearly 30 percent. This program is not going to make farmers rich or even make them whole. But it will make the difference for thousands of farm families who otherwise may be forced off the land. Farmers and ranchers need assistance for the 2005 and 2006 natural disaster losses, and they need it now. If these emergencies are not dealt with, tens of thousands of farm families and Main Street businesses will suffer, many irreparably. I have had farm meeting after farm meeting all across my State. Farmers and their families have told me that if assistance is not forthcoming, this will be their last year. I am not talking about a few, I am talking about thousands in my State. As I have indicated, North Dakota, unfortunately, is not alone. This is a drought that has been devastating to the heartland of America. That is why there are 28 sponsors of this legislation on a fully bipartisan basis. Let me conclude by saying that some have said--I know we will hear this from the chairman of the Budget Committee--this is a budget buster. Now, he knows--and everyone who follows the budget process knows--we do not budget for natural disasters. There is no line item in the budget for natural disasters--none. Natural disasters are handled on an emergency basis. That is what we are seeking--emergency funding outside of the budget because there is no budget for natural disasters--none, zero. If there is going to be any assistance, it is going to have to come as it typically has, by an emergency declaration. To uphold an emergency designation requires a supermajority vote in the Senate. It requires at least 60 percent to support that designation of emergency. So those who say it is a budget buster--wrong. There is no budget line item for natural disasters--none. The only way there is support for natural disasters is through an emergency declaration over and above the rest of the budget. Why? Because decisions have been made in the past that you cannot predict disasters by their nature. You cannot say a drought is going to happen or a hurricane or a flood is going to happen. Those are acts of God. They are acts that are unpredictable and, therefore, are not budgeted for. Perhaps they should be. Perhaps we should at least make an estimate, based on previous experience, of what natural disasters cost. But it is not done. So if there is going to be any assistance forthcoming for the tens of thousands of people who have been hurt, this is the chance this year to send a signal of help, a signal of hope, a signal that we will stand with these farm and ranch families and help them in their time of need. Amendment No. 5205 Mr. President, before I yield the floor, I send my amendment to the desk.

Mr. CONRAD. Mr. President, I suggest the absence of a quorum and ask unanimous consent that the time be equally divided.

Mr. CONRAD. Mr. President, I am glad to yield the Senator from Minnesota 6 minutes.

Mr. CONRAD. I ask the Senator from Minnesota, how much time would you like?

Mr. CONRAD. I ask unanimous consent that reading of the amendment be dispensed with.

Mr. CONRAD. I am advised I only have 13 minutes. The Senator from Montana is here as well. Would the Senator from Montana like time as well?

Mr. CONRAD. Mr. President, I ask the Senator from Minnesota, does he seek time?

Mr. CONRAD. Mr. President, I say to the Senator, we have other Members who have said they are coming, but if the Senator would like to take an additional 2 minutes, I would be happy to grant it to him.

Mr. CONRAD. I say to my colleague, this equals about 10 days of expenditure in Iraq, based on what we are told the supplemental will be and what is already in the budget. So this is modest compared to previous disaster packages. It will not make farmers whole. As I have indicated in the examples I have provided, farmers who had a 50-percent loss will still have a 28-percent loss in economic terms, even with this package. A farmer who has lost 75 percent, even with this package and with aggressive crop insurance, will still have a 28- percent loss as well. This is a defining moment for thousands of people.

Mr. CONRAD. Mr. President, we already have a unanimous consent agreement.

Mr. CONRAD. Mr. President, I have not had a chance to respond to my colleague, the chairman of the Committee on the Budget. The Senator from South Dakota has been waiting patiently, but if he would not mind if I took 2 minutes to respond to Senator Gregg. The chairman of the Committee on the Budget said: Look, this doesn't just respond to natural disasters; this is a series of earmarks. I say to my colleague, there are no earmarks here. There is nothing individual Members put in this bill. I drafted this bill. I drafted it in broad consultation with Members of this Senate. There are no earmarks in the sense of what typically is in an appropriations bill where individual Members put in provisions that have never been on any legislation before. One would be hard pressed to point to a single provision in this bill that has not been in previous disaster legislation. One would be hard pressed to find a single provision here that has not been in previous disaster legislation, in fact, in a far more generous way than is in this bill. In 2000, we had a disaster bill that cost $14 billion. The next year, in 2001, it cost between $11 and $12 billion. This disaster bill is for 2 years, and it is $4.8 billion. On a comparable basis to 2000 and 2001, that was a total of $25 billion for 2 years, and this is $4.8 billion for 2 years. The truth is, we have cut, cut, cut to be fiscally responsible. I yield the floor.

Mr. CONRAD. Mr. President, is the Senator from Louisiana seeking time? Not on this matter? Mr. President, I suggest the absence of a quorum and ask unanimous consent that the time be charged equally to both sides.

Mr. CONRAD. Will the Senator yield?

Mr. CONRAD. On the question of paying for it, I have complete agreement with the Senator from Oklahoma. I wish the rules permitted us to offer an amendment to pay for it. No. 1, on the question of requiring--that we have dropped the crop insurance requirement, we did because it cost money. It is the scoring rules around this place that don't make much sense to me. When we submitted it to CBO, they said if you have a crop--I submitted it with the crop insurance requirement in it, and they said if you do that, it costs $40 million. No. 2, there is a payment limit in this legislation. It is an $80,000 payment limit. There is a gross income test in this legislation. We tried to address some of the things the Senator is concerned about, and he is right about those things. We have tried to address it with a payment limitation--$80,000--with a gross income test, which is a little different from a net asset test, but it tries to get at the same point the Senator is making. I say to the Senator on the question of the small business economic loss grants, the Senator cited the $300 million that was in the previous legislation. We cut that to $100 million. We left it in there for this reason. We have heard from crop sprayers all over the country, at least the drought-stricken area. In the heartland of the country, they have reported they have gone to the SBA. They told them they have suffered such devastating losses, they are not eligible for SBA, they are out. That is the reason the $100 million is left. It really is for those who are most directly affected by a dramatic falloff in acreage. This started with a company in North Dakota that called me. The acreage they were spraying was reduced 80 percent this last year. Their losses were staggering. If there is not something like this, they are out at SBA. Then we started research in other States and found the same thing. That is the reason for that. I go back to the question of providing some assistance to those who didn't buy crop insurance because I basically agree with the Senator's point. We do have this fundamental problem of crop insurance not being practical and not being available, in many cases, for the specialty crop people. We did try to get at the point the Senator is making by dramatically reducing what they get. Under previous disaster bills, they would get 45 percent of prevailing prices. In this disaster bill, we have dropped that to 20 percent. We didn't think it was fair to eliminate it given the fact we have not crafted a crop insurance program--especially that the specialty crop people could have available to them--that is economically viable. I thank the Senator very much for his courtesy.

Mr. CONRAD. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. CONRAD. Mr. President, pursuant to section 402 of House Concurrent Resolution 95, the concurrent resolution on the budget for fiscal year 2006, I move to waive section 402 of that concurrent resolution for purposes of the pending amendment. I ask for the yeas and nays at the designated time.

Mr. CONRAD. Mr. President, I will take this on my time. The Senator makes a very good point. In previous disaster bills, those that did not have crop insurance got 45 percent of the prevailing price. Under this bill, we have dropped that dramatically to 20 percent. Why? The Senator asks a very good question. Frankly, the overriding reason is there are certain crops for which crop insurance doesn't work at all, largely specialty crops in this country for which the crop insurance program badly needs reform. I think most of us from farm country would agree on that. There are real problems with crop insurance. Crop insurance for specialty crops was never written in a way that makes any economic sense, or in many cases covers the crops at all. That is why we still have a provision that gives some assistance to those who do not have crop insurance.

Mr. CONRAD. Yes.

Mr. CONRAD. I am happy to yield.

Mr. CONRAD. Mr. President, will the Senator yield for one moment?

Mr. CONRAD. Mr. President, I thank my colleagues, the chairman and ranking member of the Agriculture Appropriations Subcommittee, for the many courtesies extended to those of us who are seeking to get a vote on disaster assistance this year. My colleagues, the chairman and ranking member, Senators Bennett and Kohl, have been generous and kind with respect to allowing this amendment to be considered, and we deeply appreciate it. We certainly will not forget it. The matter before the body is the fundamental question of whether there is going to be disaster assistance to this Nation's farmers and ranchers this year. I also thank Senator Frist for allowing us to take up the Agriculture Appropriations bill today, allowing me to offer this amendment to provide agricultural disaster assistance for our farmers and ranchers. It took a bit of a struggle to achieve this result, to get this opportunity, but Senator Frist has been exceptionally kind throughout this discussion and willing to have the Senate discuss this matter. Some of my colleagues may ask: Senator, the majority has already indicated they do not intend to finish appropriations bills so what is the point of this vote? Well, that is a good question. When we sought this vote, we did not know that the Agriculture appropriations bill would then not be completed. We did not know that there was going to be an intention to stop work on appropriations bills, to leave that all until next year. We did not know that. So we were working in good faith to put this before the body as a matter that is urgently needed by tens of thousands of farm families all across America. So why go on with the debate and the vote today if this bill is not going to be completed? There is one very good reason: Depending on how close this vote is, farmers and ranchers and their bankers will at least have an idea of whether there is the prospect for disaster assistance next year. It is going to require a supermajority vote today for us to prevail because the other side is going to offer a budget point of order. That is their right. If we are close to the 60 votes, then farmers and ranchers can assume there is a pretty good likelihood of disaster assistance next year. If we are not close to 60, then they will be safe in concluding the prospects, although still possible, are certainly more remote. Why is this important? Because literally tens of thousands of farm and ranch families will not be able to go on without disaster assistance. In my own State, the independent bankers of North Dakota were meeting in my office when Mr. Hubbard, chief economic adviser, came to see me on a separate matter. I asked Mr. Hubbard to go into the conference room to listen to these independent bankers, 11 or 12 of them from across the State of North Dakota. They told Mr. Hubbard clearly and directly: If there is no disaster assistance forthcoming, 5 to 10 percent of the farm and ranch families in North Dakota will be forced off the land. That is how serious the current circumstance is. It is why we come on an emergency basis for this funding. Let me indicate that this disaster approach will cost $4.8 billion. That is much less than disaster packages in 2000 and 2001, about a third of what disaster packages were in those years. But it is critically important. Why? Because in 2005 and 2006, we had a series of natural disasters across this country that were not covered in any way. The last disaster package that actually went through only applied to hurricanes. Those who suffered from drought, from flooding, were excluded. They were given no help. Let me show the headlines from my State from last year: ``North Dakota Anthrax Outbreak Grows''; ``Rain Halts Harvest''; ``North Dakota Receives Major Disaster Declaration''; ``Heavy Rain Leads to Crop Diseases''; ``Beet Crop Could Be Smallest In 10 Years''; ``Crops, Hay Lost to Flooding''; ``Area Farmers Battle Flooding, Disease''. These are only a handful of the headlines from that year. Here is a picture of a farm. Last year I flew over southeastern North Dakota, and it looked like a giant lake because farm after farm looked like this-- water from one horizon to the other. In the southeastern part of North Dakota, there was massive flooding. A million acres were prevented from even being planted. Hundreds of thousands of additional acres were ultimately drowned out. In other words, they could plant, they did plant, and then the crops were drowned out. This was a devastating year for thousands of farm families. I had a young farmer, one of the best in our State, come to a farm meeting I held. He told me: Senator, unless something happens, a lot of my neighbors are going to be gone, because we have had such an extraordinarily unusual weather cycle in North Dakota. That young man told me he has not had a normal crop in 6 years. He is not alone. I don't know whether it is global climate change or this is some very unusual weather pattern, but something is happening in my State, something that is dramatic and unusual and devastating to thousands of agricultural producers. We have a lake in North Dakota called Devil's Lake. Devil's Lake has risen 26 feet in the last 8 years. Devil's Lake is three times the size of the District of Columbia, and that lake has risen 26 feet in the last 8 years. I don't know how one would describe this, but it is outside any experience I have had to have a giant lake rise 26 feet. Three years ago in a small town in eastern North Dakota, we had 18.5 inches of rain in a 24-hour period, in a place that only receives that amount of moisture in a year. Something extraordinary is happening. The question is, will there be any Federal response or are we going to say, Tough luck, you are on your own, you are out? Irony of ironies, after the massive flooding of last year, after the extended flooding in eastern North Dakota of the last 7 or 8 years, this year drought struck, the third worst drought, according to scientists, in our country's history. That is what happened this year. And so instead of headlines about flooding, this is the headline: ``Dakotas `epicenter' of a drought-stricken nation.'' This is a report from the Grand Forks Herald, one of the major newspapers of our State; in fact, a Pulitzer Prize-winning newspaper for covering the disastrous flooding of 1997, which many will recall, when we had the spectacle of a fireman chest deep in water fighting a fire. The 1997 flood was the worst flood in 500 years in eastern North Dakota. And now that newspaper is reporting on the ``epicenter of a drought-stricken nation.'' They say here more than 60 percent of the United States is in drought. And we can see the epicenter is in South Dakota. But we are by no means alone because right down the center of the country, right down the heartland of America, is terrible drought this year, the third worst drought in our history. ``Experts say dry spell third worst on record.'' The only worse droughts were the horrendous droughts of the 1930s, which we refer to now as the Dust Bowl, and the extended drought of the 1950s. Some who are listening may ask, why haven't we heard about this? Why hasn't this been on the national news? I think we all know why. Go back to 2005 and 2006. The disasters that were in the news were Hurricanes Rita and Katrina. That is what was in the news. And we have responded to those disasters. We have not responded to this disaster because, frankly, it has gotten very little attention. This will be the last opportunity for the Senate to act on this important issue. Producers across the country can look to this vote today and be able to determine whether the prospects are hopeful. If we get close to the 60 votes or hopefully achieve a 60-vote hurdle, then the possibility of disaster assistance next year is brightened. If we do not come close, then tens of thousands of farm families are going to be at their bankers in the coming weeks, and they are going to be given the grim news that they are done; they are finished; they will not be able to continue. For over a year I, along with many Senate colleagues from both sides of the aisle, have been coming to the floor of the Senate seeking to pass disaster assistance for our farmers. Today I come with a bill cosponsored by 27 of my colleagues and myself. That makes 28 of us. On a thoroughly bipartisan basis, we have joined to urge our colleagues to consider disaster assistance. Last spring, as part of the hurricane supplemental, the Senate approved an agricultural disaster package for the 2005 crop year. That measure was later dropped in conference due to opposition from the administration and House leadership. The amendment I am offering today is similar to the bipartisan disaster relief legislation I introduced on September 28 of 2006. The need for this amendment is compelling. I think my previous remarks made clear why it is so important in my State. It is not just my State. It is North Dakota, Montana, Minnesota, South Dakota, Wyoming, Nebraska, Oklahoma, Texas, Colorado. There are many States that have been affected. In my State, in July I went on a drought tour with my colleague Senator Dorgan and our Congressman. This is my home county. This is a cornfield in July. You have heard the old saw that corn should be knee high by the Fourth of July. You can see there is almost nothing coming up. It is a moonscape. This is what southern North Dakota looked like this year, absolutely devastated. I even went to a farm where they had irrigated corn. The farmer took me out and we started peeling the ears. And on irrigated corn, the kernels hadn't filled. Why? Because in one day, it was 112 degrees in my hometown. I am not talking about the heat index; I am talking about the actual temperature--in one day, 112 degrees. When I say North Dakota is not alone, this is from the Drought Monitor from July 25 of this year. The yellow areas are termed abnormally dry; the tan areas are moderate drought; the darker tan, severe drought; the red is extreme drought; the dark brown is exceptional drought. You can see that we have had drought throughout the heartland of America--as I have indicated, the third worst drought in our Nation's history. Others are communicating with us, telling us of the urgent need for this assistance. We received a letter from 32 of the major farm organizations in America saying pass this disaster assistance. Let me read you the letter: We write to respectfully urge you to support agricultural disaster assistance for the 2005 and 2006 production years. While many of us are hopeful that even more can be done to provide disaster-related assistance, we believe the bipartisan Conrad amendment, and other such amendments that would make disaster assistance even more inclusive, should be approved by Congress this year. As you may know, a large coalition has been seeking disaster assistance for more than a year. The coalition is so large and united because last year 88 percent of U.S. counties were declared disaster areas by USDA. This year, more than 66 percent have received that same designation. With wide support earlier this year, the Senate approved a disaster assistance package. Unfortunately, the provision was changed in conference and the final language only assisted rural residents who were victims of hurricanes, not those who were victims of other natural disasters, such as drought and flooding. While many of us believe that even more needs to be done--and would be supportive of additional assistance--we nevertheless want to ensure that the Conrad amendment is approved. Quite simply, a disaster is a disaster. We urge you to support the Conrad disaster amendment and oppose a budget point of order against the amendment. Congress should do all they can to provide victims of natural disaster with the assistance that they need and deserve this year. My amendment incorporates many of the provisions already approved by the Senate. But I have made several modifications to address the objections raised by the administration. The economic assistance provisions to help program crop and dairy producers offset rising energy costs in 2005 have been dramatically reduced. Payments will only be made to producers who can demonstrate they suffered reduced income in 2005 compared with 2004, and the provision requires that those who wish to receive these direct payments forego the crop disaster payments the amendment makes available for 2005 and 2006. The administration has stated that we need to wait until harvest is concluded. The harvest is over for 2006 and the losses are real and significant throughout many parts of the country. Crop and livestock production loss provisions contained in the original legislation are retained and will apply for both 2005 and 2006. For those who say you don't have to have a loss to get assistance-- wrong. Nobody gets a dime who has not suffered a material loss. In fact, crop producers must have a loss of at least 35 percent before they get a thing. Let me repeat that. Crop producers will have to have a loss of at least 35 percent before any of these provisions take effect for them. The livestock compensation program will only be made to producers whose operations are in counties designated as disaster areas by the Secretary and who can demonstrate that they suffered a material loss. The provision also contains modest funding for conservation programs to help restore and rehabilitate drought and wildlife losses on grazing lands, and the provision assists small agriculturally dependent businesses that have been dramatically hurt as a result of these natural disasters. Because of the modifications, the cost of providing disaster assistance for 2005 and 2006 has been substantially reduced, from $6.7 billion in previous provisions to about $4.8 billion in this amendment. Some have suggested that this amendment will result in farmers becoming more than whole and that crop insurance is adequate to address the losses our producers have sustained during the last 2 years. Nothing in this debate has disturbed me more than people making that argument because it is apparent that they simply don't know how crop insurance works. They simply don't understand the formula that applies. I wanted to provide a specific example to show my colleagues what is going to happen to a typical farmer under the provisions of this legislation. In North Dakota, the average wheat yield is 34 bushels to the acre. The average harvest price is $4.57 a bushel. So per acre, a farmer could have expected, in a normal year, to get $157.21 an acre. Now, this year, if they would have a 50-percent loss, their market income would be reduced to $78.60. With their insurance indemnity, if they bought coverage at one of the most generous levels--the 75 percent level--they would get a $27 insurance payment. Under my legislation, they would get an additional $7, for a total of $113, compared to what they could have expected in a normal year of $157. They are losing $44.21 per acre in a normal year. They are still down 28 percent, even with this disaster package. For those who suffer a 75-percent loss--let me say I have many in my State who suffered a 75-percent loss--they would get $39.30 from the market. They would get an insurance payment of $54.18. Under this legislation, they would get an additional $19.50, for a total of about $113--still losing $44 an acre, still at a loss of almost 30 percent.

Mr. CONRAD. I am very much in sympathy with the Senator on the notion of paying for this. In fact, I spent much of the morning trying to figure out a way I could offer a pay-for which I think the Senator and I might agree with and I think most of the body would agree with. It would more than pay for this. I have been advised by legal counsel that if we offer a pay-for in the context of this bill and this amendment, we would then be subject to rule XVI. Under rule XVI, any Senator can raise it and the amendment would fall with no vote. So we are in a very unfortunate circumstance. We can't offer a pay-for. Let me be very direct about what the pay-for is which I would have offered today if I weren't prevented by the rules from doing so. It turns out the Interior Department failed in contracts with oil companies to provide for royalties when oil prices went above a certain amount. Oil prices are above that amount today. The loss to the Treasury, I am told, is in the range of $11 billion. That would pay for this twice over. Unortunately, we can't offer our proposal and the Senator can't offer his without being subject to rule XVI. I wanted to say that for the Record. I appreciate very much that the Senator knows I wish to pay for this as well. We have a way to do a pay-for, but I am precluded by the rules from offering it.

Mr. CONRAD. Will the Senator yield on that point without interfering with the Senator's time?

Mr. CONRAD. How much time does the Senator require? I advise the Senator we have 23 minutes remaining on our side.

Kent Conrad

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