Jeff Flake

Mr. FLAKE

Mr. FLAKE. Madam Speaker, I thank the gentleman. I should note, as I did before, this is not below the baseline. There is only room because we're going well above the baseline. We're actually charging fees or doing some other things to free up offset money to actually pay for the disaster.

Mr. FLAKE. Sure.

Mr. FLAKE. I would yield 15 seconds.

Mr. FLAKE. I assure my colleagues I won't take my entire 15 minutes, but let me point out this chart right here. These are areas that have received disaster payments in 11 of the past 21 years. When you think disaster payments, you think this is something that happens once every decade or once every century or something that is an odd occurrence. It doesn't always occur. Yet here we see, look at these dots here. One, you can tell they're highly concentrated. Certain areas keep going back for more again and again and again. These areas where you see the dots received disaster payments 11 out of the last 21 years. One dot equals one recipient here. Now 11 out of the past 21 years, if you do the math right, that's better than once every 2 years people are coming back for disaster payments, catastrophic losses of some type or another. So the notion that we're taking care of it all, that we won't have any more catastrophic disasters, I think is blown away by this chart because we see again and again. Another thing that's quite notable with this chart is you see there is a very political disbursement here. I will point out one place, right here at the top of Arkansas. You will see a smattering of dots where this represents, believe me, millions and millions and millions of taxpayer dollars going to disaster relief. But something funny happens here. Once you cross the State line into Missouri, virtually no dots at all. Very little was received at all. Now, unless droughts respect State boundaries right along the State line, or a tornado is deterred by a barbed wire fence, then this is political. There is no other way to explain this. You look down here near the panhandle of Florida into Georgia and whatnot, there are a lot, and then as soon as you cross over that State line, virtually nothing. What this suggests to me, and I'm sure anybody who looks at it in candor would say, There's probably a very active farm service organization there that is applying for these grants and going after that drought relief for whatever it's for. But you have to concede there is no other way to explain this than to see that this is extremely political. That's how it happens. That's how it happened after 2002 when the White House was under much pressure to provide disaster relief before the election was coming up. It doesn't just happen under Democrat's administrations; it happens under Republicans and everyone. We shouldn't allow this to happen. Let me just close by saying, again, we heard this in 2002, we're hearing it again. We bought it then. We shouldn't have. Let's not include this $5.1 billion disaster program. I'm hearing that it's down to $3.8. That's maybe a good sign.

Mr. FLAKE. Madam Speaker, I would simply say in response to that, this is what we heard in 2002, that we have fixed these loopholes, that this has tightened up. We won't have to have ad hoc disaster payments. There are several types. I mentioned the number of bills that have been passed to provide this type of disaster relief, whether it was for livestock or crop loss or something else. We just passed a myriad of bills to do that. And every time we hear, We've tightened it up; if you just give us a little higher baseline, if you just increase it a little more, then we promise we won't come back again and again and again. And here we are. We're back doing the same thing again. I would submit, Madam Speaker, that we simply can't do this any more. We simply can't do this. Let me go to this chart for a minute. May I inquire as to the time remaining?

Mr. FLAKE. Just 15 seconds, if I could.

Mr. FLAKE. Reclaiming my time, we heard some of these same arguments in 2002, that we had tightened things up, and that we wouldn't have the ability to game the system. Yet I mentioned the shuttle disaster as one of the more egregious examples. There are plenty of others. For example, after the Katrina disaster, part of the programs that we have allow, if prices drop substantially, that prices can be locked in at a certain price, and then farmers can go sell on the market afterwards. The system was gamed at that point; to the loss, to the tune of a couple of billion dollars. These were imaginary losses. These were not real losses.

Mr. FLAKE. Well, I'd just like to ask the gentleman. In 2002 didn't we hear exactly what we're hearing today, that if we include a permanent disaster title, that there will be no more need for disaster relief beyond this year?

Mr. FLAKE. I will gladly yield.

Mr. FLAKE. The gentleman mentioned that having these permanent disaster titles built into the budget would be a good thing so we don't have the ad hoc disaster programs. I agree, it would be. But we've done that. That's how the last firm bill was sold to us; that yes, it's a bit bloated; yes, it's bigger than you'd like, but it's going to include disaster payment so we don't have to do ad hoc stuff anymore. We're going to build it into the budget. I read several quotes. There are several more. Let me just read one more. Representative Combest of Texas said, ``There is a safety net which is built into the program. I think, to my budget conscious colleagues, of which I am one, this is more of an honest way to deal with this problem than ad hoc disaster bill after disaster bill after disaster bill after disaster bill.'' Now, that sounds just like what we heard. This was in 2002. And we've had many ad hoc disaster bills pass since that time. I guarantee you, if we pass this, with this large disaster bill attached to it, we'll see more disaster bills after this time. The gentleman mentioned that disaster bills come to fill in the gaps when there are bad crop years. That's the purpose of it. In fact, we subsidize crop disaster insurance to the tune of about $3 billion a year, I believe. We've had many programs, many bills to do that. But it hasn't seemed to work because we keep funding on top of that. If you look at this chart, this chart will show 2002 through 2006, these were not particularly bad years. In the red you will see the subsidies that were given during this time. In the yellow you'll see disaster payments added on top of the programs. So you see, in good years, in bad, it doesn't matter. We seem to have crop disaster programs and money paid out every time, no matter what. This next chart is quite telling. Shortly before the 2002 Congressional elections, the Bush administration faced growing pressure from ranchers and politicians in a handful of western States that were hit hard by drought. There was pressure to actually do something to help these ranchers. The USDA responded with a plan to give ranchers cash payments based on how much livestock they owned. Now, to qualify, a rancher had to be in a county that suffered from a drought and declared a disaster by the Agriculture Secretary in 2001 or 2002. Legislation was approved by Congress to extend the livestock program into January of 2003 as well. Let me just give you one example of how this works. I'll go to this chart later. But all you have to do is to be in a county where some kind of disaster is declared. The rules were loosened so it didn't even have to be a weather-related disaster. Something else could trigger it as well. And all a farmer had to do is say, or a rancher had to do is say, I am from this county, therefore I deserve payment. Per head livestock payment. And that was paid out. And you had counties that had no disaster at all, or parts of counties, in Arizona we have large counties, only 15 in the State, so you have parts of counties that perhaps weren't suffering any disaster at all where people were collecting payments. But what you also had, and this will demonstrate the absurdity of the program we have now and the eligibility rules. In Texas here, on February 1, 2003, we had a very unfortunate incident where the Space Shuttle Columbia exploded over Texas, upon re-entry. It scattered over a certain part of the State. The President declared certain counties in Texas a disaster area in order to have emergency services go and collect the debris. Because that was a national or, I'm sorry, a disaster declared in certain counties, all ranchers had to do in those counties is claim there's a disaster; I'm going to collect benefits for my livestock. And you had, literally, millions of dollars paid out to ranchers for their livestock because of a disaster, a space shuttle exploding over Texas. Now, that will give you some idea of the eligibility rules that apply here. This, we make no effort in this legislation, nor have we made any effort in any others to really seriously tighten up these eligibility rules. And that is simply wrong to do this. We are embarking again, let me remind you, in 2002 we were told, let's include a bigger bill, let's have a bigger bill that will include disaster relief, and then we won't need to come back anymore. We'll include it in the base bill. That's better budgeting. That's exactly what we're hearing today, the same thing, but with no promise that we'll actually get rid, or that we'll actually cut other programs, go into the commodity programs, shave money here to pay it here. No, we're just increasing the baseline substantially. And I should note, this is not paid for in the bill. The permanent disaster relief is above the base line. We're having to charge fees somewhere else to pay for this. So it's not in the bill. It's not paid for. It's actually above the baseline. So let me just urge my colleagues, you know, we have a program here that I think all of us, in our candid moments, realizes is out of control. We have subsidies going here that are well beyond what is required and necessary and right and proper. Yet, we continue to do this simply because it makes for good politics. I would think that we're better than that. I would think that we can rise up, at least now, as the House did, frankly, and say, we shouldn't have a permanent disaster title. Again, I want to commend the House for doing that. But this is why this motion is to instruct the conferees to go with the House version and not the Senate version. And I would ask my colleague, I would yield for just a minute, if you would, if we felt that a disaster title was so needed, why wasn't it included in the House bill, and why did we rely on the Senate to have it? I yield 30 seconds to the gentleman.

Mr. FLAKE. I thank the gentleman. I should note that the gentleman mentioned that we've cut billions of dollars since the last farm bill. We haven't cut anything. The reason that not as much has been paid out under countercyclical or some of the other programs is being a product of high prices, and that's as the program works. But I should note that even though there have been high prices, we're still having disasters seemingly everywhere with very loose definitions of what a disaster is, and I would suggest that we will have those again, whether or not we include a permanent disaster title. That's what experience tells us. That's what we've learned just over the past few years. It doesn't matter if you include a permanent disaster title or you include this under the baseline, you will have disaster payments go out. And my plea would be let's stand for the taxpayer here. We don't often do that in the Congress. Let's say that enough is enough, that we can't continue to pay out money on top of money that we said we weren't going to pay out. Again, I thank my colleagues for their indulgence. I know we went a little longer than we thought. I would urge support for this motion to instruct. Let's keep what the House did and reject the disaster title that the Senate put in. I yield back the balance of my time.

Mr. FLAKE. Madam Speaker, I have a motion at the desk.

Mr. FLAKE. Madam Speaker, on that I demand the yeas and nays.

Mr. FLAKE. Madam Speaker, I will yield 2 minutes to the gentleman.

Mr. FLAKE

Mr. FLAKE. Mr. Speaker, under rule XXII, clause 7(c), I hereby announce my intention to offer a motion to instruct on H.R. 2419. The form of the motion is as follows: Mr. Flake moves that the managers on the part of the House at the conference on the disagreeing votes of the two Houses on the Senate amendment to the bill H.R. 2419 (an Act to provide for the continuation of agricultural programs through fiscal year 2012) be instructed not to recede to the provisions contained in subtitle A of title XII of the Senate amendment (relating to a permanent agriculture disaster assistance program).

Mr. FLAKE

Mr. FLAKE. Madam Speaker, recently I introduced a bill to repeal some of the legislative provisions that have led to an artificial demand for ethanol. H.R. 5911, the Remove Incentives for Producing Ethanol Act of 2008, or RIPE Act, repeals the renewable fuel standard, repeals tax credits for ethanol producers, and repeals tariffs and duties on imported ethanol. These incentives are giving ethanol producers a guaranteed market for their product. Domestic corn, already a heavily subsidized commodity, has been the primary source of biofuel, and the mandate has encouraged farmers to focus agriculture production away from food production toward fuel production. The Department of Agriculture has said that the biofuel mandate has raised fuel prices as much as 20 percent. In addition, ethanol's role as a supposed savior for our energy woes has been severely overstated. Ethanol as a fuel yields about 30 percent less energy per gallon than a gallon of gasoline. This is what happens when government picks winners and losers in the economy and the marketplace. Just 4 months ago, we were convinced we had a winner. It's turned out to be a big loser. We need to remove the incentive. I urge support of H.R. 5911.

Mr. FLAKE

Mr. FLAKE. Mr. Speaker, I have a motion to instruct at the desk.

Mr. FLAKE. I thank the Chair. This motion to instruct conferees is simple. It would simply urge farm bill conferees to accept the Senate provision on the payment limits for annual direct payments, which is the same as current law. Again, we are simply asking to accept current law, rather than increase payments limitations. Let me explain. Under current law, farmers and eligible landowners can receive $40,000 per person in direct payments per year, not including a loophole that currently exists that enables that amount to be doubled. The House-passed farm bill seeks to raise this limit to $60,000 per person, while the Senate passed bill keeps the limit at the $40,000 level as in current law. In essence, this motion to instruct conferees would simply say, retain current law. Don't increase the limit on how much a farmer or landowner can receive in direct payments. Direct payments are one of the three primary subsidy programs available for commodity crops, along with countercyclical payments and marketing loan payments. Direct payments are paid to farmers and eligible landowners that have had so-called base acreage that was historically farmed for program crops like wheat or cotton or corn. Direct payments go to farmers and landowners whether the whether they farm or not on the property and are independent of crop prices. Simply put, these checks are in the mail to eligible recipients, no matter what the price of commodities. While these payments were originally intended to transition farmers away from subsidies, it is unfortunate that they have come to take a permanent place in the entitlement spending landscape and that Congress is on the verge of upping the limits on how much recipients can receive. These payments cost taxpayers more than $5 billion a year, under the last farm bill, that is, and while the bill under consideration might cut them by a minuscule amount, taxpayers will still foot a staggering bill. These handouts are often distributed to landowners who don't farm. I have even heard anecdotes about rice farmers who later subdivide the land for mini-mansions even, and realtors will advertise that direct payments will come to the new landowners. Lucky them. Get a house on land that was previously a rice farm. You are going to be getting direct payments. How is that? How can we countenance a situation like that continuing? According to a recent analysis by the Environmental Working Group, with the present loopholes that are available to recipients, ``a total of 1,234 recipients collected direct payment subsidies worth $120,000 or more, costing taxpayers $226 million total. One hundred forty-nine recipients got more than $250,000 in direct payments. The top 10 percent of direct payment subsidy recipients in 2007 collected about 60 percent of this government money.'' These are the payments on which the House-passed bill would increase the limit by 50 percent. We have a strong agricultural economy at present. Unlike the countercyclical and marketing loan programs, which, if you have a good agricultural economy, don't get paid out, this program keeps paying out no matter what. These are independent of crop prices. It is unfathomable that U.S. farmers that are enjoying historically low debt-to-asset ratios and consistently high cash receipts and robust farm export values, under this scenario the conferees would need to increase the limit on direct payments beyond the current $40,000 limits. It is unfortunate. It looks like the 2007 farm bill will be a missed opportunity to reform the wasteful farm subsidy programs, like the one I have spoken about. As approved by the House, the best that can be achieved in terms of reform is a reduction in the income cap for payment eligibility programs from $2.5 million to $1 million or $2 million for married folks. Even though the administration has sought a $200,000 income cap, both the House and the Senate it seems, and it seems the conferees, appear content to continue to allow millionaires to receive farm payments. While acting as if real reform had been made on the income cap, the House-passed farm bill actually relaxes the limits on how much a recipient can receive in farm payments. We simply cannot go in this direction. We have been told again and again and again by both sides of the aisle that we won't have a farm bill that has the generous subsidy payments that we have had before, that there has to be reform. This is not reform. Some people may try to sell it and say we are getting rid of a loophole there, so we will have to increase this, and then we will phase it out at some other time. That is probably what we will hear. When you hear that, hold on to your wallet. You have to remember that this program that we are talking about, this direct payment program was instituted in the nineties as a way to transition farmers away from subsidies. Yet here it is still, a decade later, and we are talking about increasing it. So if anybody tells you we are increasing it so we can actually phase it out easier or somehow lessen payments that will go out, don't believe it. Don't believe it. Let's vote for this motion to instruct. I reserve the balance of my time.

Mr. FLAKE. I will go ahead and reserve until the gentleman has closed.

Mr. FLAKE. I've enjoyed this back-and-forth. Let me just say that it's implied again that we don't know what we're talking about somehow, that somehow we're divorced from the farming community and we don't know what they go through. Let me just say, if you look at the end of my right index finger, it's gone. I left it in an alfalfa field at age 5. I don't know all the ins and outs. I've been away from farming on a real basis for a while. But it's not a complete alien world to me, and certainly not to my family and relatives. But let's get back to what we're talking about with this motion to instruct. We're talking about not a safety net at all. We're talking about direct payments, in many cases to farmers who don't farm at all, that is not tied to crop prices, whether they're high or low. This is a relic of reform attempts in the 1990s when we were trying to wean farmers away from subsidies that didn't happen. But these subsidies still remain, despite the fact that the other subsidy programs came back. And all we're saying here is that, let's keep the limit at current law, at $40,000 per person, not increase it to $60,000 per person. Yet we're being accused of trying to completely dismantle the family farm by not increasing the subsidies that are being paid out right now. We're simply saying they should remain where they are in current law. So despite all the talk about stable food prices for citizens of the United States, or whatever else, remember, this motion to instruct has nothing to do with that. This simply has to do with a program that gives direct payments to people who, in many cases, do not farm at all, that has no tie to crop prices, whether they're high or whether they're low. Let me simply say also that the administration said this week, this plan would result, talking about the current iteration of the farm bill, this plan would result in the continuation of farm subsidy payments to individuals with extremely high incomes. The administration also said, this is not reform, and does not move Congress closer to a farm bill that the President would sign. I certainly hope that the President sticks with that commitment. We need a farm bill that honors our commitment to have some fiscal responsibility here. Upping the limit of direct payments, increasing it by 50 percent, is not fiscally responsible. So I would encourage my colleagues to join us in voting for this motion to instruct. Discount the debate that doesn't have anything to do with this debate on whether or not the conferees should accept the current subsidies or increase them. With that, I thank the gentleman from Wisconsin for his words and for all those who have participated. I would encourage a vote in favor of the motion to instruct. I yield back the balance of my time.

Mr. FLAKE. Mr. Speaker, on that I demand the yeas and nays.

Mr. FLAKE. May I inquire as to who has the final word.

Mr. FLAKE. I appreciate the words of the gentleman from Wisconsin. I too have traveled to Australia and New Zealand, and I talked to the farmers there. They heard the same horror stories there. They worried about the same thing when they got rid of subsidies in New Zealand. As the gentleman from Wisconsin mentioned, you would be hard-pressed to find anybody who wants to go back to that system because, just as the gentleman from Arkansas just mentioned, they don't like the government telling them what they can and can't farm. A main element of this program we are talking about right now is that if you are to receive these direct payments, you can't farm specialty crops. You have to farm corn or wheat or rice. You can't do specialty crops. So for all of the talk about we don't want government telling us what we can and can't plant, that is a central element of this program that you accept those restrictions. There is something wrong with that argument when we say we don't want government to tell us; but yes, you can tell us as long as we can collect these direct payments. The gentleman from Arkansas said that prices are up high now, but they will go down. Yes, they will; but these direct payments will remain the same. That is the problem here. These aren't a safety net, these are just a direct subsidy in many cases whether you farm or not. That's the problem with this. And we aren't saying get rid of it. I would like to, frankly, if it were up to me. But we're not saying that. All we are saying is keep it the same. Don't increase it. Yet we are hearing the argument that somehow all of the family farms are going to go away unless we increase a direct payment that bears no relationship to crop prices at all. There is something wrong with that argument. So we are competing here in a vacuum.

Mr. FLAKE. I yield to the gentleman from Wisconsin.

Mr. FLAKE

Mr. FLAKE. I thank the gentleman for yielding. I rise in opposition to this bill. H.R. 1195 is purported to be a technical corrections bill. When you hear ``technical corrections,'' you often think of missing commas or misspellings or inverted numbers or other drafting errors. We are doing far, far, far more than that here with this legislation. There are, I believe, more than 200 earmarks that are receiving so-called technical corrections here. These are substantial in nature. They are not simply technical. I think they deserve further scrutiny. We have all found out what happens when we rush legislation like this through. The underlying bill had 6,300 or 6,200 earmarks, as was mentioned. If you're making technical corrections, they should be technical. These are more than technical. They deserve more scrutiny. We don't want to find out later that we have the same problems that we had before. For that reason, I will oppose the legislation.