April 4, 2001 Mr. CONRAD. I listened to my colleague and my friend from New Hampshire describe farm prices rising. I would love for him to go to my home State and tell the farmers that farm prices are rising. They are not rising. They have the lowest farm prices in real terms in 75 years. That is what is happening to farm prices. Mr. GREGG. Will the Senator yield? Mr. CONRAD. I will be happy to yield in a moment. I would love to have a dialog on this question. I say to my friend from New Hampshire, I know agriculture is not a dominant industry in New Hampshire but it is dominant in many States in the Nation. For those who represent farmers, we can report to our colleague there is a desperate crisis across farm country. This is about as serious a situation as I have ever seen. When our colleague says farm prices are rising, he is talking about a projection into the future by the Congressional Budget Office, the very same people who said prices would be rising now, when prices have plummeted. Their record on forecasting farm prices is not very good. It is another indication of why there is great danger in banking on any 10-year forecast. That is what the Senator from New Hampshire was showing, a 10-year forecast for farm prices by people who in the past haven't been able to forecast farm prices worth a hoot and a holler. Here is what has happened. This is what has really happened from 1991 to now. The red line on this chart is the prices farmers receive. The distribution of this line is quite clear. It is almost straight down. The green line is the prices farmers pay for their input. It is going up, up, up. It is the relationship between the prices farmers pay and what they are paid that has created this farm crisis. It is why there is strong support on a bipartisan basis to respond. It is the reason so much of farm income is currently coming from the Federal Government. If it weren't, we would have an absolute collapse occurring in farm country. My State is a wheat State. When my colleague from New Hampshire says farm prices are rising--and I say I would love to have him come to my State and address a farm crowd and explain to them how farm prices are rising--this is why he wouldn't get a very good reception. This chart shows what has happened to farm prices ever since we passed the last farm bill which was a disaster in itself. Farm prices have plummeted. That is what has happened to wheat prices. Here is the cost of producing. Here is what has happened to prices. The prices are far below the cost of production. Mr. GREGG. Will the Senator yield? Mr. CONRAD. I will yield soon. I want to first devastate the case the Senator made. Mr. GREGG. You are not devastating my case. You are trying to devastate CBO's case. Mr. CONRAD. No, the Senator was making the case that CBO made. When you say farm prices are rising, they are not. That is the simple reality. What you have is the lowest prices in real terms in 75 years, and it is a crisis all across rural America, all across agricultural America, and every Senator who represents a farm State, farm constituency, knows it. Let's talk about some of the underlying reasons we have this serious problem. This is what our major competitors are doing. We cannot talk about agriculture in isolation. We have to talk about what is happening with our major competitors. Our major competitors are the Europeans. This is what the Europeans are doing to support their producers: $313 an acre on average. This is for the period of 1996 to 1999. This is what we are doing in the United States during the same period: $38 an acre. That is nearly a 10-to-1 advantage in terms of what the Europeans are providing their producers versus what we are providing our producers. These are not Kent Conrad's numbers; these are the numbers from the Organization for Economic Cooperation and Development. They are the international scorekeepers on these questions. It isn't just what they do for their producers directly; it is also what they are doing in terms of agricultural export support. Here is what the Europeans are doing. This chart shows which countries are providing what percentage of world agricultural export subsidy, according to the World Trade Organization. This is for the last full year for which there are records, 1998. The blue pie on this chart is Europe's share of world agricultural export subsidies. It is 83.5 percent. The U.S. share is 2.7 percent. That is 30 to 1 as a differential. Is there any wonder our farmers are getting killed in the international marketplace? Is there any wonder our market share is going down and Europe's is going up? Is there any wonder Europe was poised to surpass us in world market share last year? Our friends in Europe have a strategy and a plan. They are working it, and they are working it very effectively. They have told me flatout: We think we are in a trade war with you in agriculture, and we think at some point there will be a cease-fire in this trade war. We believe it will be a cease-fire in place. We want to occupy the high ground. The high ground is world market share. We are going out and buying. That is exactly what they are doing. They are buying world market share. We are faced with a circumstance in which we have a crisis in American agriculture. It is deep. It is threatening. It is so serious that if it is left unchecked, it will force thousands of farmers off the land--not because of anything they have done but because of our failure to respond to the European juggernaut. The Senator from New Hampshire wanted to join in a colloquy, and I am happy to entertain a question on his time.