[Senate Hearing 110-233]
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2008
S. Hrg. 110-233
HARVEST OVER THE HORIZON: THE CHALLENGES OF AGING IN AGRICULTURE
=======================================================================
HEARING
before the
SPECIAL COMMITTEE ON AGING
UNITED STATES SENATE
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
WASHINGTON, DC
__________
JUNE 21, 2007
__________
Serial No. 110-9
Printed for the use of the Special Committee on Aging
Available via the World Wide Web: http://www.gpoaccess.gov/congress/
index.html
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SPECIAL COMMITTEE ON AGING
HERB KOHL, Wisconsin, Chairman
RON WYDEN, Oregon GORDON H. SMITH, Oregon
BLANCHE L. LINCOLN, Arkansas RICHARD SHELBY, Alabama
EVAN BAYH, Indiana SUSAN COLLINS, Maine
THOMAS R. CARPER, Delaware MEL MARTINEZ, Florida
BILL NELSON, Florida LARRY E. CRAIG, Idaho
HILLARY RODHAM CLINTON, New York ELIZABETH DOLE, North Carolina
KEN SALAZAR, Colorado NORM COLEMAN, Minnesota
ROBERT P. CASEY, Jr., Pennsylvania DAVID VITTER, Louisiana
CLAIRE McCASKILL, Missouri BOB CORKER, Tennessee
SHELDON WHITEHOUSE, Rhode Island ARLEN SPECTER, Pennsylvania
Debra Whitman, Staff Director
Catherine Finley, Ranking Member Staff Director
(ii)
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C O N T E N T S
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Page
Opening Statement of Senator Gordon Smith........................ 1
Opening Statement of Senator Herb Kohl........................... 2
Prepared Statement of Senator Robert Casey....................... 11
Panel I
Keith Collins, chief economist, U.S. Department of Agriculture,
Washington, DC................................................. 3
Panel II
Barry Beshue, president, Oregon Farm Bureau, Boring, OR.......... 23
John Rosenow, farmer affiliated with the Wisconsin Academy of
Sciences, Arts and Letters, Cochrane, WI....................... 30
Derek Godwin, staff chair and Watershed Management Extension
Specialist, Oregon State University Extension Service, Salem,
OR............................................................. 37
Isaac Kershaw, Ph.D., Ohio State Department of Education, Career
Tech and Adult Education, Columbus, OH; representing Future
Farmers of America............................................. 42
APPENDIX
Prepared Statement of Senator Ken Salazar........................ 47
Responses to Senator Casey's Questions from Keith Collins........ 47
Responses to Senator Casey's Questions from John Rosenow......... 51
Responses to Senator Casey's Questions from Isaac Kershaw........ 52
(iii)
HARVEST OVER THE HORIZON: THE CHALLENGE OF AGING IN AGRICULTURE
---------- --
THURSDAY, JUNE 21, 2007
U.S. Senate,
Special Committee on Aging,
Washington, DC.
The Committee met, pursuant to notice, at 11:02 a.m., in
room 325, Russell Senate Office Building, Hon. Gordon H. Smith
(ranking member of the committee) presiding.
Present: Senators Kohl, Casey, and Smith.
OPENING STATEMENT OF SENATOR GORDON H. SMITH, RANKING MEMBER
Senator Smith. Good morning, ladies and gentlemen. We
welcome you all.
I am grateful to be here with my colleague, Senator Kohl,
who is the Chairman of this Committee. The way he and I
operate, we do it in a very bipartisan way and tend to see
these issues not as Republican or Democrat, but as issues that
affect older Americans.
There has not been too much discussion on the aging
demographics of American agriculture. So I look forward today
to a productive discussion with our panelists.
I want to extend a personal welcome to two Oregonians who
are here: Barry Beshue of the Oregon Farm Bureau and Derek
Godwin of Oregon State University. We congratulate the Beavers
on their progress in the World Series. [Laughter.]
As Congress moves forward with Farm Bill proposals, it
might be worth considering how many farmers will be around 10
years from now and how old they will be. Right now, nearly a
quarter of farm operations in the country are 65 years of age
or older. That contrasts with only 8 percent of that age class
in non-agricultural industries.
That statistic becomes even more significant when we look
at the shrinking number of farms in America. In 1930, there
were over 6 million American farms. In 2002, there was one-
sixth of that number. Clearly, farms are either consolidating
or disappearing altogether. Young people are either not
entering the business, not taking over the family business, or
both.
This trend has something to do with how hard it is to be a
farmer these days. In the West, farmers do not just have to
deal with crops and fuel prices; they also have drought and
wildfire and endangered species to deal with.
But why should we care? Well, we should.
First of all, agriculture remains a unique part of this
country, a land blessed with fertile soil and good climate.
Americans once believed that rain follows the plow. The dry
corners of my State, however, disprove that theory, but not the
interest and intransigence of the American farmer.
The U.S. Capitol is adorned with images of wheat and
tobacco. ``America the Beautiful'' speaks of amber waves of
grain and the fruited plain.
I love the quote of Thomas Jefferson, who spoke of the
virtues of American agriculture. Wrote he, ``Those who labor in
the earth are the chosen people of God, if ever he had a chosen
people, whose breasts he has made his peculiar deposit for
substantial and genuine virtue. It is the focus in which he
keeps alive that sacred fire, which otherwise might escape from
the face of the earth.'' The importance of American agriculture
can also be described in more tangible terms. There is a
national security interest of a country that can and does
produce its own food supply. The U.S. produced a record amount
of food in 2006.
We also imported a record amount of food, with imports
continuing to close in on that gap. Recent stories of tainted
food from foreign nations remind us of why our agriculture and
our health and safety standards are important.
Last, so many of the communities in my State are rural and
based on a farm economy of one sort or another. As farms
dissolve and children move away, those communities suffer.
Again, I look forward to hearing more from our panelists
about these issues and what options we, as a Government, have
to turn to in order to turn the current trend around.
With that, I turn to the Chairman, Senator Kohl.
OPENING STATEMENT OF SENATOR HERB KOHL, CHAIRMAN
The Chairman. Well, we thank Senator Smith for holding
today's hearing on the challenge of aging in agriculture.
Welcome our witnesses and look forward to their testimony.
In my own State, this is an especially important topic
because, in Wisconsin, the average age of farmers is 53 years.
It is critical that the decades of knowledge and experience of
these farmers is not lost.
Wisconsin has 76,000 farms, a very, very high number of
farms, and they generate more than $51 billion annually in
revenues. So, being the largest industry in our State, it is
not only a serious workforce issue, it is a critical issue for
the entire economy of our State.
We are truly at the front line in facing the challenge of
aging in agriculture. Wisconsin is preparing to meet this
challenge.
We will hear today from John Rosenow of the Wisconsin
Academy of Sciences, Arts and Letters.
The academy spent the last 2 years researching the future
of farming and rural life in Wisconsin. Academy members met
with hundreds of Wisconsin farmers and conducted six regional
forums throughout the State to identify problems and
opportunities. Their comprehensive study has resulted in more
than 80 recommendations for action items to be undertaken by
policymakers, communities and citizens.
We look forward to hearing the details of their important
work today from Mr. Rosenow, who operates a very successful
family farm in our State.
As a Nation, we must address our rapidly aging farming
communities. As you will hear today from Mr. Rosenow, without
things like good schools, good jobs, affordable health care,
our rural communities will lose their vitality.
I strongly believe that continuing this vitality will
require continuing intelligent Federal involvement, and I
believe it is necessary for the Federal Government to help
rural life if we expect rural life to continue to thrive and
grow.
Again, I thank Senator Smith for raising this issue today
in this Committee. I am delighted to have this distinguished
group of witnesses assembled to explore these issues and offer
solutions that, hopefully, will allow our Nation's farmers and
our rural communities to continue to exist at a level of
prosperity in our country.
Thank you so much.
Senator Smith. Thank you, Senator Kohl.
We had scheduled to have Chuck Connor, the deputy secretary
of Agriculture, with us today, but he has been called to a
meeting at the White House, and it is a higher pay grade than
Senator Kohl and I have, but we are very grateful that Keith
Collins has come in his stead. He is well-equipped to address
this issue.
Keith, we thank you for your time, your presence and your
competence on these issues.
STATEMENT OF KEITH COLLINS, DEPUTY CHIEF ECONOMIST, U.S.
DEPARTMENT OF AGRICULTURE, WASHINGTON, DC
Mr. Collins. Well, thank you very much, Senator Smith,
Chairman Kohl. Good morning. It is nice to be here.
I do want to begin by saying that Secretary Connor regrets
that he is not able to open this important hearing this
morning. As you noted, some serious issues have arisen that
have compelled him to stay back at the department this morning,
and I thank you for permitting me to pinch hit for him this
morning.
Mr. Chairman and Mr. Smith, USDA very much appreciates the
chance to talk about issues related to older farmers and
ranchers in American agriculture. Agriculture today is
undergoing some very significant and rapid changes. We have
sharp growth in international trade, we have new production and
processing technologies emerge almost daily, and we have had
this remarkable increase in the demand for biofuels. All of
these things are presenting new economic opportunities.
The past few years have generally been prosperous times for
American agriculture, and we expect another above-average year
for farm income in 2007. Higher incomes and rising land values
have added substantially to the wealth of producers.
At the start of this year, U.S. farm equity, or net worth,
totaled $1.7 trillion. That is up half a trillion from just 3
years ago. Stronger economic returns to farm production are
important for attracting people new people into farming and for
keeping current young farmers in operation.
But hoping for prosperous times may not be enough to deal
with the advancing age of our farmers. The average age of
primary farm operators, which partly reflects the rising
average age of our population as a whole, has increased nearly
5 years, from 50.5 years in 1982 to 55.3 years in 2002, the
last agricultural census year.
As Mr. Smith noted, the primary operator on nearly one-
fourth of all farms with $10,000 or more in annual sales was 65
years of age or older in 2002.
The rise in the average age of primary operators reflects
both a decline in the number of young farmers and an increase
in the number of older farmers. The continuing decline in the
number of younger farmers has raised concerns that insufficient
new entrants will be available to replace a large and growing
number of retiring farmers.
I want to emphasize that there is no evidence that a
shortage of farm operators has caused or is likely to cause in
the near future reduced production and higher prices of U.S.
farm commodities. There is evidence that there are a
substantial number of young farmers present on farms, although
they do not serve as the primary operator. These secondary and
third-level operators in many cases represent future primary
operators.
While there appears to be no impending slowdown in farm
production resulting from the advancing age of primary farm
operators, there are important concerns about how the upcoming
intergenerational transfers may affect the future structure of
agriculture.
Primary operators 65 years of age or older own over one-
fourth of farm assets and one-third of the total acres of land
in farms. Ultimately, these assets will be sold or passed on to
their heirs. Selling or leasing these assets to existing
operators would raise concerns about consolidation and its
effects on the structure of agriculture, local economies and
rural landscapes.
Over the past two decades, there have already been
substantial declines in the number of mid-sized farms and
increases in the largest size farms.
The divergence between the number of younger new farm
entrants into production agriculture and the exit of older
retiring farmers and the potential barrier to entry of new
farmers created by rising farmland values and the rising
complexity of farm production today are factors behind interest
in policies to encourage entry into agriculture and to assist
in the intergenerational transfer of assets from one generation
to the next.
The USDA has a number of ongoing programs to help older
farmers and to encourage beginning farmers, and there are many
wonderful private-sector programs and dedicated professionals
involved in helping farm businesses prosper and transition.
Our efforts at USDA range from programs supported through
the Cooperate State Research Education and Extension Service
that help older farmers and their families improve their
business and their family planning. We also support 4-H and its
9,000 members that teach young people leadership, citizenship
and life skills. We assist FFA and its 500,000 members which
orient young people toward careers in agriculture. We have also
targeted our credit programs and our other assistance programs
to beginning farmers.
Today, I would also like to highlight the opportunity we
have with the 2007 Farm Bill to address the challenge of
effectively transferring today's farms from one generation to
the next.
The administration is recommending a broad package of
changes to several Farm Bill titles that provide additional
support to beginning farmers and ranchers. You may have seen
our book, which I will hold up for you. It is 183 pages of Farm
Bill ideas, and we have a special section on beginning farmers.
As part of our proposals, we suggest for the commodity
title that beginning farmers receive a 20 percent increase in
their direct payment rate for 5 years. That would add an
estimated $250 million to new producers' incomes over the next
decade.
Under the conservation title in our proposals, we are
recommending that 10 percent of Farm Bill conservation
financial assistance be reserved for beginning farmers as well
as socially disadvantaged producers under what we are calling a
new conservation access initiative.
As part of the credit title, we recommend prioritizing
USDA's direct operating and farm ownership loans to first meet
the needs of beginning and socially disadvantaged farmers. We
also recommend enhancing the existing beginning farmer and
rancher down payment loan program to help ensure the success of
the next generation of production agriculture.
Of course, we know that the Federal, State and local
Government programs alone cannot ensure that older and
beginning farmers can successfully meet all the life challenges
found in farming. Private-sector efforts are critical. Market
incentives from a strong farm economy are essential.
Nevertheless, the 2007 Farm Bill provides an excellent
opportunity, an opportunity we should not chance missing, to
improve the effectiveness of our collective efforts.
Thank you, Mr. Chairman.
Senator Smith. Thank you, Mr. Collins.
You mentioned, and I referred to it as well, the number of
farms declining. What about the acreage under cultivation? Is
that declining?
Mr. Collins. There has been a general trend over the last
decade of a decline in the number of acres planted to principal
crops and a slight decline in the total number of acres in
farms. It looks like this year, in 2007, that is going to
reverse itself. It will see an increase.
Senator Smith. Is that due to food and fuel now being an
option for farmers?
Mr. Collins. That is the primary reason, yes.
Senator Smith. Are more farmers taking land out of the
Conservation Reserve Program as a result of that?
Mr. Collins. Not yet. We have about 36 million acres in the
Conservation Reserve Program.
Senator Smith. Do you expect that that will happen?
Mr. Collins. I expect that that will happen. Over the next
four years, between 2007 and 2010, we have about 12 million
acres under contracts that will terminate. What gets planted
depends on what we do at USDA: Will we hold more open
enrollments, more signups, and how frequently will we do that?
We will give people an opportunity to put that or other land
in, and, of course, the rental rate we offer is an incentive to
do that. It will depend on whether farmers pick that up or not.
Senator Smith. With the improvement in farm economies
through so much of the country, I am wondering if that is a
category that will really be in decline and then the amount of
acreage will be dramatically on the increase.
Mr. Collins. Our current projection is that the 37 million
acres would fall to around 32 million acres in the Conservation
Reserve Program (CRP) over the next several years.
Senator Smith. From 40 to 32?
Mr. Collins. From 37 to 32.
Senator Smith. From 37 to 32.
Do you have any bias or preference for encouraging more
land to go under cultivation, come out of the program? I mean,
does the administration have a policy on that?
Mr. Collins. The administration's articulated policy is
that there will be no open enrollment in 2007 because of the
record high prices we expect for many commodities. The
Secretary has indicated he is reserving judgment at this point
on whether he will hold another signup in 2008. We do----
Senator Smith. It seems to me that the farmers would rather
farm, and if they have options that are profitable, that ought
to be encouraged because the Nation needs the food and the
fuel, and the competition between the two is certainly
squeezing the food chain.
Mr. Collins. I think you make a very good point. It is a
point that I have made from an economic point of view. There is
also, on the other side, a very strong conservation movement
that would like to retain the environmental benefits that have
been achieved under the program as it now exists. So those two
needs have to be balanced.
Senator Smith. Sure.
I want to ask you about imports. Despite the improving farm
economy, imports continue to be on the rise. We are at about a
50-50 point between domestic and foreign food production. I am
wondering if you see any reversal on that, or is USDA concerned
that we are going to become a net food importing nation?
Mr. Collins. Well, that prospect has been before us over
the last several years, and, in fact, if you go back two or
three years ago, many people were projecting, within the next
few years, we would become a net importer. In fact, that has
not happened, and the gap between exports and imports has
widened a little bit.
This year, we expect about $77.5 billion worth of
agricultural exports and around $70 billion in imports. So
there is a spread of nearly $8 billion at this point. Now that
is way down from $25 billion to $30 billion that it was in the
mid-1990's.
So imports have grown faster than exports. Over the last
couple of years and probably the next couple of years, it looks
like they are probably going to grow together, so I do not
really expect them to cross.
Senator Smith. As we contemplate this issue of the older
farmer I live in rural Oregon, I am surrounded by farmer
neighbors, and many of their kids go off to Oregon State and
other places, and they go into fields.
Do you think if the dollars improve that that will do the
job and get more of them to look to agriculture as their daily
bread as well? I suspect that is a central key.
Mr. Collins. I am a market-oriented guy, and I think that
when the rates of return in some investment go up and exceed
the rates of return in other investments, then assets move into
that, both human capital and in physical assets. So I think
that that could help solve the problem.
The question is, though, what does that structure of
agriculture look like as that occurs? Are the assets that are
moving into agriculture existing farmers that are getting much,
much bigger and foreclosing on the opportunity of current farm
children to farm?
There is a question about what that structure of
agriculture would look like, and I think that is why, even
though we do not perceive of an insufficiency of people willing
to farm, we are concerned about giving people--young people,
people that live on farms and people that do not live on
farms--an opportunity to have a chance in agriculture.
So, yes, I think a market rate of return can be a powerful
incentive for generating production, but I also think that
there are also social and other issues that have to be dealt
with here as well that motivate the reason for policies and
programs.
Senator Smith. Now, as you contemplate a new Farm Bill, I
am sure you know that one of the biggest costs in running a
farm is just compliance with regulations. Is there anything you
are planning to do or prepared to propose to streamline
regulation, reduce it, eliminate it where possible, to help, or
do you see the regulatory burden just growing and growing?
Mr. Collins. Well, the regulatory burden has grown. USDA is
not a large regulatory agency with respect to farmers. In fact,
through our Natural Resources Conservation Service we provide
the tools to farmers to help them meet regulations that
generally come from the Environmental Protection Agency or the
Department of Interior Bureau of Land Management and so on.
I would say that one development that we have seen, and
something that we have proposed in the administration's Farm
Bill proposals, is to try and rely more on markets to deal with
environmental regulation. I mean, the clearest example we see
today is the voluntary market for greenhouse gas offsets that
revolves around the Chicago Climate Exchange.
We have a proposal to broaden that dramatically and to get
the regulatory agencies to come to the table, USDA and the
other regulatory agencies, to come to the table and agree on
how activities of farmers--ecosystem services they are called,
like mitigating greenhouse gas emissions--how these ecosystem
services could be used to comply with regulations.
That way, farmers, in fact, might be able to get paid for
an ecosystem service that a public utility or an electrical
generating plant would use to meet an environmental regulation.
So we have a broad-based proposal that looks at both farm
regulation as well as societal regulation that would get
farmers an opportunity to be a solution for people who are
being regulated and earn an income at the same time. It is kind
of a creative idea.
Senator Smith. It is. This is my last question. I will turn
it over to the Chairman. But I am wondering--and I do not know
the answer to the question I am about to ask you, but when it
comes to global warming and providing carbon sinks, what
captures more carbon, fields left idle or fields under
cultivation? Is there a difference between one crop versus
another?
Mr. Collins. Oh, there is definitely a difference between
one crop and another, and the answer to that question is, it
all depends. You can, certainly, through cultivation,
dramatically increase carbon sequestration, but if you left the
field idle and you did not tend it and it did not have a good
cover crop, it would lose organic matter and would be a net
emitter.
So with using the right crops, the right cover crops, the
right rotations, the right tillage practices, you can restore
soil carbon and you can sequester greenhouse gases, and if you
look at----
Senator Smith. That would be an argument on the side of
taking land out of CRP, an environmental value on the side of
the economy.
Mr. Collins. Well, the extreme case, of course, is that you
cultivate the land by planting trees, and then you can get the
most carbon sequestration.
Senator Smith. We are big on that in Oregon. [Laughter.]
Thank you very much.
Senator Kohl.
The Chairman. Thank you, Senator Smith.
Welcome to you, Mr. Collins. I have had the opportunity, as
you know, to work with you now----
Mr. Collins. Yes, sir.
The Chairman [continuing]. For many years, and you are a
great, great asset to the USDA and a great asset to our
country. I have always found my interaction with you to be
extremely positive and informative, and it is good to see you
here today.
Mr. Collins. Well, thank you very much, Senator Kohl. That
is a nice compliment.
The Chairman. Mr. Collins, one of the things, of course,
that the farmers talk about is the ability to pass on their
farm to their heirs, and in that connection, they talk about
the estate tax exemption, and many of those who are pushing for
total abolition of the estate tax refer to ranchers and farmers
as being key in this area.
I think, to some extent, it is really not true, but do you
think in order to put this aside entirely in terms of the
estate tax impacts on small ranchers and family farmers, we
might increase the exemption from what it is today, which I
believe is $2 million, $4 million a couple, to maybe $4 million
or $5 million so that, in fact, we would put 98 or 99 percent
of all family farms in this country out of the reach of the
estate tax?
Mr. Collins. I cannot state what the administration's
position on that would be, but my view on this would be that
that would be a very positive thing to do. At one time, that
unified credit exemption was as little as, what, $650,000, very
burdensome for many, many family farms. I think, as you raise
that up, you do resolve a problem that farms would face in
transitioning from one generation to the next.
So I do not know if that is going to resolve the issue and
take it off the table, but I think it would be a very positive
step for farmers.
The Chairman. Thank you. I agree with that, and I think we
need to move in that direction.
Mr. Collins, there is always a debate when we set a Federal
budget, particularly farm policy. There are those who believe
there are fairly generous farm policies and rural expenditures
already important to our country in terms of trying to keep
rural America alive, growing and thriving, and there are others
who believe that the market should more or less run its course
and have its impact and we here in Washington setting Federal
policy with tax dollars should more or less not get overly
involved in that whole discussion.
Many of us, and I am one of them, believe that if we are
going to see our rural economy and rural life continue on and,
hopefully, grow, then there has to be some level of Federal
involvement, things like good schools, helping to create jobs,
health-care benefits, Internet connection, you know, cable
kinds of setups. These things cost money, and these things take
some level of Federal tax expenditure.
Where do you fall in terms of your philosophical thoughts
about how important it is, A, to keep our rural life thriving
and growing, including agriculture, of course, which is the
foundation of rural America, and that we should be willing to
spend a certain amount of tax dollars to encourage this?
Mr. Collins. Senator Kohl, I personally and as representing
the Department of Agriculture, I can say the Department of
Agriculture feels very strongly in favor of the sentiment that
you just expressed. The Department of Agriculture is
responsible for coordinating rural development across the
Federal Government. We are dedicated to the mission of trying
to increase economic activity in rural areas.
Yes, there can be a debate about whether you should let the
market take its course. I mean, that debate is often framed in
terms of people versus place. Do you invest in people, such as
equipping them with better human capital, more skills, more
education and let them go where they want, or do you invest in
place to give people that live in a certain area an economic
opportunity that would parallel those that might live in
suburban or urban areas.
I think the answer to that is you do both, and in the
Department of Agriculture, we do both. As you know, we have a
vigorous rural development program that invests in things like
you talked about: broadband connections, rural community
infrastructure, water and sewer systems and libraries and
health-care facilities and firehouses. We provide lending for
all of those things, and we think those are all very important
to help develop the network of infrastructure on which rural
businesses can prosper and provide rural jobs and rural growth
and economic employment opportunities for rural people.
We target a lot of our programs to the areas of the country
where poverty levels are the highest, the persistent poverty
counties of our country, and so we think that from both an
economic and a social perspective that we ought to be investing
in rural America. That is why Farm Bills have a rural
development title, and we think that is very, very important,
and we have proposals as well in our Farm Bill proposal to
expand our funding of our rural development activities.
So I would say the position you voiced is one that we
subscribe to very strongly.
The Chairman. I thank you very much. Thank you for being
here.
Thank you, Senator Smith.
Senator Smith. Thank you, Chairman Kohl.
We have been joined by Senator Casey of Pennsylvania.
Senator, if you have an opening statement or questions for
the witness, we welcome those.
Senator Casey. Thank you, Senator Smith and Chairman Kohl.
I do not have any questions for Mr. Collins in the interest
of time. I am sorry I missed your presentation. If we have
something that we could submit for the record by way of
writing--and just some brief comments to open because I know we
want to transition to a new panel, and I know we got notice
about votes, too.
Just very briefly, I want to thank the Chairman for calling
this hearing, and with unanimous consent, I will ask that my
full statement be made part of the record.
Senator Smith. Without objection.
Senator Casey. But I did want to say how appreciative I am
to be on this Committee and also to be able to participate in
this hearing because I come from a State where agriculture is
not just an important industry or an important economic sector;
it is the dominant one in large measure. Millions of people
affected by what happens on our farms and what happens to our
farm families, dairy being a huge component of that.
All of the issues that have been discussed already today
and will be discussed in the second panel about the aging of
our workforce, and in particular the aging of our farm families
and farmers have a tremendous impact on Pennsylvania, so we
need to focus on this, and I am grateful that this hearing
calls attention to that challenge, especially in the context of
our dairy farmers.
It is very difficult to do the work. It is very difficult
to get the capital to acquire the land. We see this firsthand
in Pennsylvania.
So I am grateful for this opportunity. I want to thank the
Chairman, and I also want to thank Senator Smith for allowing
us to come together today.
By the way, this is the first time I have been in this room
for a hearing, in this historic hearing room, so thank you very
much.
[The prepared statement of Senator Casey follows:]
Prepared Statement of Senator Robert P. Casey
Mr. Chairman, thank you for holding today's hearing on the
challenge of aging in agriculture. As you may know, in my home
state, agriculture continues to be the number one industry.
Dairy is our largest agricultural segment, accounting for 42%
of all agricultural revenues.
Unfortunately, the impact of aging in agriculture and the
difficulties facing young farmers pose an all too real threat
to the continued success of our dairy industry. Pennsylvania
continues to lose between 250 and 350 dairy farms every year
due to farm sellouts and retirements. While the vast majority
of Pennsylvania dairy farms are family operations, younger
generations are increasingly reluctant to work the long, hard
hours required when they see their parents doing this same work
and not being able to make ends meet.
New start-ups of dairy farms typically number less than 30
per year. One reason for this is that the cost of purchasing
land is extremely high, making it nearly impossible for young
farmers to start new operations. All told, between 1995 and
2004, Pennsylvania saw a 29% reduction in the number of dairy
farms.
Pennsylvania's situation is not unique. Nationally the
average age of farmers continues to increase as fewer young
people choose farming as an occupation. At the same time, the
number of farms and farm acres continues to decline.
American farming has reached a critical threshold. We must
find solutions to reduce these trends, to encourage our young
people to seek careers in agricultural production. Likewise, we
must ensure the availability of incentives to ensure
agricultural production remains a viable occupation for young
farmers.
I again would like to thank the Chairman for calling this
hearing. I look forward to hearing the testimony and working
with my colleagues to find solutions to these challenges.
Senator Smith. Thank you, Senator Casey. Yes, this is a
very historic room, and it is appropriate for the Aging
Committee to be here.
Thank you very much, Keith Collins, for your time and your
testimony today.
Mr. Collins. Thank you very much.
[The prepared statement of Mr. Connor follows:]
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Senator Smith. We will call up our second panel.
It consists of Barry Beshue, president of the Oregon Farm
Bureau; Dr. Ike Kershaw, Department of Education of the State
of Ohio, representing the Future Farmers of America; Derek
Godwin, staff chairman and watershed management specialist from
Oregon State University; and John Rosenow, a farmer affiliated
with the Wisconsin Academy of Sciences, Arts and Letters.
I will give everybody fair warning. Apparently, they are
going to have a couple of votes here. We will try to get
through all of your testimonies and questions, if we can, but
appreciate your time here. We want to give you the time that
you have prepared to present. Any abbreviation you can do, we
appreciate that, too. All of your testimonies will be fully
included in the record.
Barry, welcome.
STATEMENT OF BARRY BESHUE, PRESIDENT, OREGON FARM BUREAU,
BORING, OR
Mr. Beshue. Chairman Kohl, Ranking Member Smith and Senator
Casey, I want to thank you for the opportunity to testify
before you today. My children are pleased that I was actually
able to comment on something for which I am eminently
qualified, and that is getting old. So they sent my
congratulations along and their thanks to Senator Smith.
It is a privilege to represent all members of the Oregon
Farm Bureau and the agricultural community in the great State
of Oregon. Oregon Farm Bureau is the largest agricultural
organization in the State, representing all aspects of our
industry. Consequently, our industry and our interests are wide
and diverse.
However, among those many interests of the farmers and
ranchers in Oregon, there is one key element that ties us all
together, and that is the desire to keep agriculture
economically viable, passing down our family operations to
future generations, and to continue to provide Americans with
the safest food and fiber in the world.
More often than not, the general public regards the Farm
Bill as the only legislation affecting the agricultural
industry. What most do not understand is that nearly every
aspect of public policy decisions has a significant impact on
agriculture. These issues, most outside the scope of the Farm
Bill, and the effect on future and beginning farmers are what I
would like to focus on today.
As an ambassador for Oregon agriculture, I am deeply
concerned about the future of our industry. In Oregon, 29
percent of farmers are over 65. A full 81 percent are 45 years
old or older, with only a quarter of a percent being 25 years
old. I doubt this is significantly different than the national
statistics.
Farming is not easy. There are no guarantees, no paychecks
every 2 weeks, little stability, and it is extremely expensive
to start. These statements probably beg the question, why in
the world would anyone want to be part of the industry? The
answer is clearly the shear love of the land.
Environmental conservation is of the utmost importance to
farmers and to ranchers. It is too often that farmers and
ranchers are labeled as anti-environmentalist. I am here to
clarify that and tell you that farmers and ranches are directly
involved in the protection and the utilization of the
environment surrounding it.
Preservation of land and conservation of other natural
resources is necessary if we are to live and professionally
thrive. However, increasing and unnecessary regulations on the
industry continue to force established farmers and ranchers out
of business. That is not much of an incentive for a young
person.
For example, the Agricultural Protection and Prosperity Act
of 2007 currently circulating through Congress regarding the
Comprehensive Environmental Recovery, Compensation & Liability
Act is critical to future producers. I do not believe it was
ever the intention of Congress for CERCLA to apply to manure.
The law clearly exempts the application of chemical fertilizers
containing the same constituents as manure, which occur
naturally in the environment. Furthermore, animal agriculture
operations are already regulated under the Clean Water Act, the
Clean Air Act and various State and Federal laws to protect our
environment.
Regulations in areas such as animal agriculture are also a
critical disincentive for new entrants and encourage aging
operators to exit earlier. For example, over the last decade,
Illinois lost half of its livestock operators, and the burden
and costs associated with environmental regulation were no
doubt a factor in those decisions.
In many cases, the loss took the form of a 55-year-old
operator exiting now rather remodeling facilities and changing
operating procedures radically. Most of what would have been
the natural replacement of exiting operators was also cutoff by
the complicated regulations governing new farmers and entrants.
The agricultural industry continues to educate Congress on
animal rights groups, their strategies and their ultimate goal
of ending animal production for food. Not only would this have
a devastating economic impact, but also the public campaigns on
behalf of these groups provide the public with misinformation
and half truths. The mission of our industry is to educate
Congress and the public on animal rights issues, as well as to
provide tools to assist in State and local animal rights
legislative and regulatory challenges.
This is not a large versus a small farm issue, or better
put, a corporate versus family farm issue. The statutes current
reporting requirements and liability thresholds for non-
agricultural release or emissions of regulated substances are
extremely low. Virtually any agricultural operation producing,
storing and/or using animal manure could and likely will be
held liable.
Oregon is a specialty crops State. We are famous worldwide
for our fruits and vegetables as well as our tree planting and
nursery industry. It is a very competitive and fragile industry
impacted by spikes in planting, production and weather. Most
importantly, the availability of labor is critical to any
specialty crops operation. Again, the unpredictability and
uncertainly of the labor force is not an enticement for young
farmers.
American farmers and ranchers face a catch-22 when
verifying the status of their workforce. It is illegal to
knowingly hire someone who is not authorized to work, but the
employer is limited in what he or she may ask for to determine
who is authorized.
I commend the efforts of the Senate regarding bipartisan
comprehensive immigration reform. Your hard work would provide
relief from labor shortages. It is critical that comprehensive
immigration reform legislation get signed into law this year.
If, however, President Bush ends up signing into law a bill
that does not fully address agriculture's labor needs,
economists estimate that up to $9 billion nationwide in annual
production is at risk of being lost to foreign competitors.
Oregon agriculture is estimated to lose nearly $5 million
directly.
A successful comprehensive immigration reform must include
a reliable verification system, border security, adequate
transition provisions and a viable long-term guest worker
program.
The estate tax is a tremendous burden on farmers and
ranchers. Individuals, family partnerships or family
corporations own 99 percent of the 2 million farms that dot
America's rural landscape. Farms face a common problem of being
land rich and cash poor.
The burden of the estate tax, which can be as a high as 45
percent, often forces young farmers and ranchers to sell land,
buildings or equipment needed to operate their businesses just
to pay this egregious tax burden. When farms and ranches
disappear, the rural communities and businesses they support
also suffer.
The average estate tax payment in 1999 to 2000 was the
equivalent of up to 2 years of net farm income. Roughly twice
the number of farm estates paid Federal death taxes compared to
other estates in the late 1990's. Moreover, the average farm
death tax is also larger than the tax paid by most other
estates.
Congress voted to end death taxes in 2001. Unfortunately,
the bill's provisions expire in 2011, requiring Congress to
pass additional legislation to make death tax elimination
permanent. I urge the Senate to take up companion legislation
to H.R. 2380 permanently repealing the inheritance death tax.
Finally, I would be remiss if I did not mention the
reauthorization of the Secure Rural Schools Act is essential,
and I probably could not go home if I did not. This funding is
vital for the education of children in Oregon and across the
country.
More than 100 years ago, Congress recognized that these
rural communities and counties with federally owned forestland
within their boundaries would not be able to provide basic
services because of the reduction and the resulting loss of
property tax base.
Congress also recognized that national forests exist for
the benefit of an entire Nation and, therefore, the entire
Nation has a role in maintaining the health of our forests and
their surrounding communities. Well-funded, well-educated rural
communities are critical to an agriculture future.
This is an exciting time for United States agriculture, but
so much of what happens in these halls has a direct impact on
the industry. As farmers and ranchers continue to utilize
cutting-edge technology, yields will increase while maintaining
our international reputation of providing Americans with the
safest low-cost of food in the world.
It is with sincere gratitude that I thank you not only for
the opportunity to share with you the many challenges facing
our young farmers and ranchers today, but also for the great
work that you folks do day in and day out.
Thank you.
[The prepared statement of Mr. Beshue follows:]
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Senator Smith. Thank you, Barry, for that excellent
testimony.
Why don't we just go down the row? John Rosenow, why don't
you take it over?
STATEMENT OF JOHN ROSENOW, FARMER AFFILIATED WITH THE WISCONSIN
ACADEMY OF SCIENCES, ARTS AND LETTERS, COCHRANE, WI
Mr. Rosenow. Thank you for inviting me. I am John Rosenow,
a dairy farmer from Cochrane, WI. I appreciate this opportunity
to speak to the Committee today in my role as a leader in the
Future of Farming and Rural Life in Wisconsin's two-year study.
The Future of Farming project is the current public policy
initiative of the Wisconsin Academy of Sciences, Arts and
Letters. I have co-chaired the production agriculture segment
of the study.
I have chosen to be involved in this project because I am
one of those rural folks. My entire life has been devoted to
agriculture, and it has been very good to me as a business and
as a way of life. I am now 57 years old and, over the years,
have gained some insights that may be of value.
Agriculture is dynamic. Our farm has changed from 50 cows
to 500, from one employee to 19, from all English-speaking to
only half native speakers, and there are fewer and fewer of us.
I could just ride it out and retire and move south, but I think
things can be done to revitalize rural America. I am here today
to explain how we have approached this in Wisconsin.
The Future of Farming and Rural Life initiative began in
2005 with the mission to create a fact-based process that would
stimulate thought, conversation and action on the important
issues in farming and rural life in Wisconsin.
To gather maximum expert and grassroots input, we held six
regional forums around the State in a 2-day statewide
conference to stimulate learning and engagement. The pending
final report is based on 83 recommendations. Implementation of
those recommendations represents a commencement to a rural
renaissance in Wisconsin.
Organizations committed to rural development are currently
seeking funding from foundations and Government agencies to
work on specific project recommendations. These efforts will
create what we hope will become a model rural development
program.
Included in the materials I have submitted for the
Committee's review is a video that illuminates the role of
immigrants in farm labor today. There is considerable
information on the project Web site and in the submitted
materials, including the draft recommendations.
In our limited time today, I would like to touch on just a
few of the things we learned.
There is considerable poverty in rural Wisconsin, and that
affects rural communities in many ways. Conversely, there are
farmers who have accumulated some wealth as well, usually tied
up in land.
Health care is a major, perhaps the greatest, concern among
rural residents. Almost one-third of Wisconsin farmers have no
insurance or only catastrophic insurance. Of those with
coverage, 36 percent secure it through off-farm employment. In
many cases, the off-farm insurance does not cover farm-related
injuries.
Rural citizens are less healthy as they delay or avoid
professional care. The Future of Farming study concludes that
all citizens are entitled to access to high-quality, affordable
health care and better preventive care.
Wisconsin needs to re-think its education system and
develop alternate funding strategies. With decreasing school
enrollments and resources, fewer rural students may be able to
compete for higher education or desirable employment.
Some school districts with large immigrant populations are
experiencing rapid growth which aids their funding resources.
For example, since the first of the year, Arcadia has seen a
growth of 159 students in a district with 986 students in all
grades.
Rural communities are hampered by inadequate access to 21st
century jobs and leadership for economic development.
Inadequate access to high-speed Internet and telecommunication
services slows economic development, innovation,
entrepreneurial behavior and educational services.
In contrast to this, there are 11 telephone cooperatives
that serve a portion of rural Wisconsin. These co-ops provide
all their subscribers with the latest in Internet services.
Wisconsin's biggest agricultural asset is its diversity.
Thoughtfully preserving working lands is critical to our State.
Vulnerable mid-sized farms urgently need public policy
attention.
The emerging bioeconomy holds great promise in Wisconsin.
Wisconsin farms are now truly dependent upon immigrant labor.
An effective documented worker program and sensible immigration
laws are crucially important to the dairy and food processing
industries.
My own example is instructive. In 1998, I hired my first
immigrant from Mexico. This was a difficult decision. I did not
want to do this. I wanted to hire locally. I did not want to
hire Spanish-speaking people I knew nothing about. I had no
choice as the labor situation became very tight. My experience
with reliable, hard-working Latinos has been very positive.
Today, most dairy farms in Wisconsin with employees have
Mexican help.
Along with many others, I have founded an organization
called Puentes that provides language and cross-cultural
training and links us employers with the families of our
Mexican employees. This unique approach has been very
successful in making employers caring and benevolent rather
than the established exploitive stereotype.
This is what I hope you take away from this conversation.
The people living in rural Wisconsin and America are no longer
all Northern European, white, 3rd and 4th generation Americans.
There is a new diversity to rural America which creates both
opportunities and challenges.
Conditions are ripe for a rural renaissance, which is in
the interest of all citizens, regardless of where we live.
Results of the Future of Farming study are applicable
elsewhere.
Throughout the Future of Farming project, we heard from
citizens that they need the tools for rural development.
Congress can support those efforts with policy and funding.
Thank you.
[The prepared statement of Mr. Rosenow follows:]
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Senator Smith. Thank you very much, John.
Derek Godwin.
STATEMENT OF DEREK GODWIN, STAFF CHAIR AND WATERSHED MANAGEMENT
EXTENSION SPECIALIST, OREGON STATE UNIVERSITY EXTENSION
SERVICE, SALEM, OR
Mr. Godwin. Thank you.
I know this might be a little difficult for Senator Smith,
but I would like for you to imagine yourself as a farmer in
Oregon. You probably grow grass seed, vegetables, stone fruits,
Christmas trees or nursery stock. You would make decisions on
when to plow, plant and harvest, how much fertilizer to apply
and when, and methods to eradicate a variety of pests or fungi.
You make decisions on who to hire, how to train them, what
jobs could be contracted, what equipment to purchase or lease,
and you would hope for good weather and high yields and
reasonable prices for your products in order to pay the bills
and make a living.
So then imagine your business as family owned, and you live
where you work. You cannot get away from your work. There are
decisions and work on evenings and weekends. These decisions
are made with your spouse and family, causing tension and
stress.
Now I do not know about you, but my wife and I argue about
where furniture is located in our living room and the bushes we
plant in the backyard. So I have a hard time imagining making
family decisions and work decisions on the family farm.
But, despite the many challenges facing family farms, I
believe it is this very structure that has made agriculture in
America so successful. It is the ties to the land that ensure
that land, natural resources and communities are protected and
sustained.
So, no matter what the future holds for agriculture and
whether it is moved toward organic markets or niche markets or
new products, success will come because we have supported
families on farms.
Now one piece of information that was part of the 2002
Census of agriculture that I have not heard this morning was
that only 9 percent of the just over 2 million farm operations
have multiple operators that span two or more generations, and
this means that the overwhelming large majority of operations
do not have a younger generation in place in which to transfer
the operation.
So how do we keep the family and family farms for our
future? First, I would like to identify a few things that are
preventing young people from staying on the farm.
One is profitability. Decision makers and consumers alike
are sort of stuck on cheap food as a goal, both in the local
super market and as a way to compete in foreign markets.
Second is the difficult access into farming. In reality,
you are either born into it or marry into it. Small farms are
an option, but small farms have a hard time surviving and are
often highly leveraged and are often subsidized by off-farm
income.
Third is the estate taxes. They are a major burden facing
the intergeneration transfer of a farming operation. A farm may
be asset heavy, whether it is profitable or not, and the last
transfer between the parent and offspring can still be heavily
taxed, so much so that the heirs often go into debt or sell
large portions of the property to pay the tax bill.
So these three reasons are tangible barriers to choosing
farming for a career, but you also have long hours, low pay,
isolation, working with your parents, few vacations and
weekends off, and to paraphrase a local farmer: How are you
going to keep them down on the farm after they have seen what a
job at Microsoft pays?
So let's see. What are some solutions to resolving these
issues?
One is explore alternative ways to help farmers remain
competitive locally. In Oregon, we are having some success with
marketing local products to support local farmers, and I have
seen more educated shoppers in the supermarkets choosing these
local products as opposed to the cheaper alternatives from
other countries.
Oregon is also pushing State-funded schools to use locally
grown products over the cheaper foreign grown products.
Second, eliminate or drastically restructure the estate tax
to not penalize families who want to transition their ownership
and keep the farm a farm.
Third, look for ways to make access into farming a reality
for more young people. Even young farmers who are taking over
the business from their parents may not be able to do it
because the equipment and operation is outdated and they cannot
afford to pay for the modernization. Assistance could be
provided through low-interest long-term loans, and it could
also be supporting the education of young people who plan to go
back to the family farm.
The fourth, on a smaller scale, I would like to see agri-
business, agricultural organizations and non-profits and even
local farmers take a more direct role in nurturing those young
people who want to get into and remain in agriculture. These
avenues could include working with local FFA Chapters, 4-H
Clubs, community colleges and universities, and they should be
available for internships, work-study programs and job
shadowing.
Finally, I would like to see support groups and networks
created that link schools and organizations together with farm
families. These networks would help farm families facing these
challenges.
One example of supporting this type of network in educating
farm families is OSU's new education program entitled Ties to
the Land: Keeping Forests and Farms in the Family. The
essential premise of Ties to the Land is that a successful
succession plan is dependent on how a family effectively
communicates and follows a fairly simple process in creating a
transition plan.
So Ties to the Land guides the family through a 10-step
planning process which incorporates effective communication
techniques, helps them set goals, create business entities, set
employment policies, assessing reasons why to keep the property
in the family, having fun on the property and creating a
governance structure that will survive the parents passing.
So, in closing, I commend this Committee for identifying
these critical issues facing agriculture, farm families, rural
communities and society in general, and exploring possible
solutions to support our future.
Thank you.
[The prepared statement of Mr. Godwin follows:]
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Senator Smith. Thank you very much, Derek, for that
excellent testimony.
Isaac Kershaw, you are going to get the last word. The vote
has started, but we are going to hang here with you. We
apologize we do not have time to do the vote and Q&A, but
Senator Kohl and I will submit written questions to you for
your consideration.
Mr. Kershaw. I will try to be quick.
Senator Smith. OK.
STATEMENT OF ISAAC KERSHAW, PH.D., OHIO STATE DEPARTMENT OF
EDUCATION, CAREER TECH AND ADULT EDUCATION, COLUMBUS, OH;
REPRESENTING FUTURE FARMERS OF AMERICA
Mr. Kershaw. Well, good morning, Ranking Member Smith and
Chairman Kohl. It is a pleasure to be here today. I appreciate
the opportunity to address the Committee on behalf of the
National FFA Association and the National Council for
Agricultural Education.
Today, I would like to share with you our insight regarding
issues associated with aging farmers and ranchers and the
challenges facing young people who have a desire to enter
production agriculture.
The retirement of aging baby boomers and the graying of
American farmers rightly raise significant questions: Who will
farm the land? Will we have enough young people willing to
enter the field in the future? Will they be successful? With
respect to agricultural education, who will prepare them?
Those familiar with agricultural education know there are
currently more than a million students in our public schools
preparing for careers in agriculture, food and natural
resources. A half-million of these young people are members in
FFA, an organization dedicated to developing the potential of
students in leadership, personal growth and career success, all
of which is an integral part of an agricultural education
program.
A rising FFA membership is at the highest point in 28 years
and suggests increasing interest by students in agricultural
careers. Some 12,000 teachers in 7,200 schools work with these
students every day, helping them discover their talents,
explore opportunities in agriculture and channel their efforts
for career preparation. It is a system that has served
generations of the Nation's farmers and ranchers, and today it
is bringing the best and the brightest to agriculture.
Agricultural education programs are designed to create
awareness of opportunities in agriculture, to motivate young
people to begin their preparation for a lifelong career in
agriculture, and to prepare them with the knowledge and skills
necessary for success in higher education and on the job.
Students explore careers and begin to understand that 21st
century agriculture is a global enterprise based in science,
which demands continued growth in discovery and application.
Many of these young students choose to pursue careers in
farming and ranching. Many others might take a different path
in an agriculture career, but all are related to the science,
the business, the technology of agriculture. All are tied to
food, fuel, fiber and the management of our natural resources.
I submit we have an ideal system in place to produce the
results we seek. Agricultural education and FFA have the
ability to attract, motivate and help prepare the next
generation of agricultural leaders, managers, scientists and
producers. But we will best serve the interests of agriculture
and the Nation if we can dramatically expand the reach of this
program to more of our Nation's high schools.
The agricultural education community is in the process of
implementing a plan of action designed to significantly
increase the number and the quality of agricultural science
programs in the country. Working under the direction of the
National Council for Agricultural Education, we have adopted a
long-range goal to increase the number of programs from 7,200
today to 10,000 by the year 2015. This ambitious effort is
viewed as a key strategy for attracting the talent and
commitment of those who will keep American agriculture thriving
and productive.
We know that significant financial resources are necessary
for young men and women to enter careers in production
agriculture. It will require a comparable investment in
education for them to acquire the knowledge and skills
necessary to be successful. So this should be seen as a great,
necessary investment in our national future.
The focus of the Special Committee on Aging, to facilitate
an effective transition to a new generation of agricultural
producers, is timely and critical. The more students we get
through our educational pipeline, the greater the number
prepared to successfully fill the shoes of the farmers and
ranchers who preceded them.
But we need help with this endeavor in terms of research
and program innovation. We need more investment through
education and agricultural appropriations. We need language in
the Farm Bill and in educational policy that strengthens the
role of agricultural education and FFA in securing the future
agriculture base of the Nation.
There is a real opportunity for the Federal Government to
take an active role as we move forward with the initiatives of
having 10,000 quality agricultural science programs by the year
2015.
So, Mr. Chair, Mr. Smith, I certainly appreciate the
opportunity to address this Committee and wish you the best in
your deliberations.
[The prepared statement of Mr. Kershaw follows:]
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Senator Smith. Thank you so very much. That was
outstanding.
Would you agree, Isaac, that if the dollars get better, all
of these programs in place, we will get more students and then
more kids on the farm?
Mr. Kershaw. Absolutely.
Senator Smith. Any final comments, Senator Kohl?
The Chairman. An excellent hearing, excellent testimony, on
a very, very important question, not only, of course,
agriculture, but rural American in its entirety is the subject
of what we are talking about, and I think all of us agree it is
worth preserving and worth investing in, and you are here today
to testify to that.
We appreciate your coming, and we will get back to you with
our questions.
Senator Smith. Thank you all so very much for your time and
your attention to this important issue and sharing your
excellent testimony with us.
We apologize that the leadership of the Senate does not
check with the Aging Committee before they schedule votes. So
that will truncate this session a bit.
But, with that, our thanks.
We are adjourned.
[Whereupon, at 12:03 p.m., the Committee was adjourned.]
A P P E N D I X
----------
Prepared Statement of Senator Ken Salazar
I would like to thank Chairman Kohl and Ranking Member
Smith for holding this important hearing.
As a member of the Senate Committee on Agriculture I can
say that this is an issue that continually comes up in
discussions about the future of agriculture. Over the last year
I have traveled to every corner of Colorado conducting ``Farm
Bill Listening Sessions'' to hear directly from agricultural
producers about what they are looking for in the 2007 Farm
Bill. One of the ``big picture'' issues that I hear from
Coloradans is that we must work to revitalize rural America so
that our young people in our rural communities do not dismiss
the idea of taking over their family's farm or ranch as well as
the need to draw new blood into agricultural careers.
The current data on this issue is a stark reminder of the
need to act. Nationally, there are about twice as many farmers
over the age of 65 as there are under the age of 35. In
Colorado the average age of our principal operators is 55 and
rising.
So, the million dollar question is how do we revitalize
rural America and reverse this trend? I don't think there is an
easy answer and I look forward to hearing from our witnesses on
this topic.
In my mind, I believe that part of the answer lies in
taking advantage of opportunities that are being created by
renewable energy.
That is why I introduced the 25 by 25 resolution that lays
out a goal of producing 25% of our country's energy needs by
renewable energy by 2025.
A University of Tennessee study projected that this goal is
achievable and will generate over $700 billion in economic
activity and create 5.1 million jobs by 2025, mostly in rural
areas. That is serious rural development. I, and the 33
Senators who have co-sponsored this resolution, were able to
add that resolution to the Energy Bill that is on the Senate
floor this week. I believe this Energy Bill is a great step in
the right direction for renewable energy and rural America.
Americans are sick and tired of depending on foreign
countries for our energy needs and they are demanding action to
change the status quo and Congress has noticed. The country is
ready to take the next step in developing renewable energy and
Rural America stands to benefit more than any other part of our
country.
It is imperative that we seize these opportunities as they
are presented and I look forward to working with my colleagues
here and on the Agriculture Committee to do just that to
revitalize rural America.
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Responses to Senator Casey's Questions from Keith Collins
Question. The USDA, in its 2007 Farm Bill proposal, has
proposed several measures dealing with payment increases and
loan incentives to provide additional support to beginning
farmers and ranchers. What other types of incentives, besides
those proposed by USDA, would be effective vehicles to bring
more young people into careers in farming and agriculture.
Answer. As noted in your question, the Administration's
2007 Farm Bill proposal recommends a broad package of proposed
changes to several Farm Bill titles to provide additional
support to beginning farmers and ranchers. These proposals
include changes to the commodity, conservation, and credit
titles identified in the written testimony of USDA Deputy
Secretary Conner for the June 21, 2007 hearing.
We believe these changes are the most cost-effective ways
to bring more young people in careers in farming and
agriculture. However, we would encourage Senator Casey to share
any ideas he may have with the Department in an effort to
address this important issue.
Question. The rising costs of health care and insurance
coverage are critical concerns for farm families, causing large
numbers of farmers to choose minimal insurance coverage or no
coverage at all. How large an impediment is this issue in
recruiting and retaining America's farmers?
Answer. Market incentives augmented by Federal and State
programs will determine the future supply of farmers and
ranchers. If farm production provides a sufficient return,
capital investment and people will enter production
agriculture. Low rates of return will discourage investment and
cause farm failures.
Nevertheless, there are a number of issues concerning the
adequacy of the future workforce needed to farm the nation's
agricultural lands. The decision to enter or remain in farming
is influenced by several factors. Perhaps the greatest barrier
to enter farming is the high price of land. Farmland values
have been steadily increasing for many years, but jumped 15
percent in 2005 after a 21 percent increase in 2004, adding to
the cost of entering farming. Between 2002 and 2006, the
average value of farm real estate increased 57 percent. These
figures indicate that access to capital for the purchase of
land, buildings, and equipment may be significant hurdle for
many young farmers.
Health care and insurance coverage are also concerns. Data
collected by USDA's Economic Research Service (ERS) as part of
the 2005 Agricultural Resource Management Survey (ARMS)
provides additional insights into farmers' health insurance
choices. The 2005 ARMS found that almost 85 percent of farm
households had full health insurance, 7 percent had a portion
of household members covered, and 6.5 percent had no coverage.
For those farm households that had health insurance, 50 percent
of farm households received health insurance through off-farm
work of the farm operator or operator's spouse (table). Another
44 percent of farm households received health insurance through
private insurance or public insurance (e.g., Medicare,
Medicaid). Only 6 percent of farm households received health
insurance through the farming operation. The data suggest that
health insurance is important to farm families but is likely
more important in the decision to have one family member work
off-farm rather than for the entire family to leave farming.
Sources of Health Insurance and Health Care Expenditure of Farm
Households
------------------------------------------------------------------------
Source of Health Insurance percent
------------------------------------------------------------------------
Insured through operator or spouse off-farm work............... 50
Insured through private health insurance....................... 22
Insured through public health insurance........................ 22
Insured through farming operation.............................. 6
------------------------------------------------------------------------
Question. How can we better educate and train our young
people to prepare them for careers in farming and agriculture?
Answer. There are many ways to better educate and train our
young people to prepare them for farming and agriculture. One
tangible way is to continue to support the 4-H program.
Participants benefit from a variety of activities intended to
foster the development of life skills and competencies through
participation in activities focused on science, engineering,
and technology (SET); citizenship; and healthy living.
Today there are about 6.5 million children aged 5 to 19
participating in the 4-H program, an increase from the 5.7
million children that were participating a decade ago. However,
only about 12 percent of eligible children participate in the
4-H program. 4-H is trying to double the number of members and
the SET Task Force has an initial goal of providing high-
quality SET experiences to 1 million new students by 2013.
Another program that helps improve agricultural education
is Agriculture in the Classroom coordinated by USDA. Its goal
is to help students gain a greater awareness of the role of
agriculture in the economy and society. The program is carried
out in each state, according to state needs and interests, by
individuals representing farm organization, agribusiness,
education and government. USDA supports the state organizations
by helping to develop Agriculture in the Classroom programs,
serving as a central clearinghouse for materials and
information, encouraging USDA agencies to assist in the state
programs, and coordinating with national organizations to
promote the goal of an increased awareness of agriculture among
the nation's students. Please see: http://www.agclassroom.org/.
Question. According to the Agriculture Census, the U.S.
lost over 16 million acres of farmland to development and other
nonagricultural purposes between 1997 and 2002. If this trend
continues, how will U.S. agriculture production, and in turn,
food prices, be affected?
Answer. Shifting farmland to urban and nonagricultural
purposes, historically, has posed no threat to U.S food and
fiber production. For example, research conducted by USDA's ERS
has shown that between 1997 and 2002, U.S. total cropland area
declined about 3 percent to 442 million acres, the lowest level
since USDA began compiling this statistic in 1945. However, the
value of U.S. crop output in 2002, measured in real (inflation-
adjusted) terms, was 2.6 times higher than in 1948, although
the value of aggregate input use declined over this period.
Therefore, although cropland was declining, increasing
productivity allowed U.S. farmers to produce more crops with
less land. In addition, the greater use of nonland capital and
materials like energy and agricultural chemicals has
substituted for land and labor. Increases in yields, due to
improved seeds and other technological changes, have also
raised output. For example, from 1945 to 2002, average corn
yields quadrupled, while real prices received for grains fell
by 80 percent. As a result of rising productivity, despite a
smaller land area devoted to crops, U.S. agricultural output
continues to grow and consumers continue to pay lower real
prices.
[GRAPHIC] [TIFF OMITTED] T9864.026
Responses to Senator Casey's Questions from John Rosenow
Question. The USDA, in its 2007 Farm Bill proposal, has
proposed several measures dealing with payment increases and
loan incentives to provide additional support to beginning
farmers and ranchers. What other types of incentives, besides
those proposed by USDA, would be effective vehicles to bring
more young people in careers in farming and agriculture.
Answer. Agriculture is very capital intensive and the
transfer of assets from one generation to another has
historically been done within families. The parents usually
provided loans for the new generation to begin creating some
equity. Modern systems especially in livestock require more
investment than most families can provide so new business
structures are used such as partnerships, limited liability
companies or corporations. Favorable tax policies for farmers
or reduced regulations by government in these structure issues
will go a long way to providing opportunities for the next
generation.
Question. The rising costs of health care and insurance
coverage are critical concerns for farm families, causing large
numbers of farmers to choose minimal insurance coverage or no
coverage at all. How large an impediment is this issue in
recruiting and retaining America's farmers?
Answer. This is vitally important. Our Future of Farming
study found this to be the number one issue for rural families
across the state. Due to the high cost of health insurance and
the deductibles, many farm families have made conscious
decisions to have one spouse work off the farm for health
coverage. When one spouse works off the farm, he/she can
contribute less to the farming operation and the tendency to
keep farming declines, resulting in more flight from farms by
children and the farmers themselves. Lack of insurance also
delays or prevents farm families from seeking routine or
preventive care of treatment for injuries, leading to more
advanced illnesses when professional care is sought, and
ultimately shortened careers.
Question. How can we better educate and train our young
people to prepare them for careers in farming and agriculture?
Answer. Education for careers in agriculture is not limited
to academics. Experience is almost as important. A program that
utilizes the experience of existing successful farmers in
educating the next generation would help a lot, perhaps in
mentoring relationships, on-farm internships, or by utilizing
successful active or retired farmers as integral resources or
contributors to classroom programs in different areas of
expertise. It is also important for the next generation of
farmers to have training in business and financial planning and
personnel management. Increasing choices about expanding
specializing, or converting to other operational types mean
that farmers need to be able to make knowledge-based decisions.
The growing trend toward using non-family labor requires more
sophisticated people management skills.
Question. According to the Agriculture Census, the U.S.
lost over 16 million acres of farmland to development and other
nonagricultural purposes between 1997 and 2002. If this trend
continues, how will U.S. agriculture production, and in turn,
food prices, be affected?
Answer. I believe that advances in production resources and
practices will continue to outpace the loss of farmland as it
has in the last 50 years. However, critical farmland needs
protection. Wisconsin and other states are identifying and
targeting critical agricultural lands and developing and
initiating tools to protect them. State and federal programs,
like the federal Farm and Ranch Lands Protection Program, are
urgently needed. Wisconsin is losing farm land at one of the
highest rates in the U.S. Changing this pattern requires
education of the general public about the consequences to them
of fragmenting or paving over productive agricultural land and
ongoing meaningful dialogue between competing stakeholders to
recognize that not all farm land is equally valuable and not
all can be saved.
Question. As a dairy farmer, do you feel that the dairy
industry faces any unique challenges in dealing with farm
succession and an aging farm workforce?
Answer. Dairy has entered a stage many call a revolution.
Old barns and practices are being replaced by very different
barns and ways of doing things. Early adapters are finding good
profits while late adapters and ones who have not changed are
struggling. This means that a limited number of dairies are
prepared for the future with adequate capital to grow with
emerging technology.
The future in dairying is thus a structure of more than
family. It means combining resources with neighbors, adding
outside investor capital and developing the human resources.
Immigrant labor will milk a greater percentage of cows at an
expanding rate which will mitigate the aging of the owners and
managers. For example, my father was physically unable to
continue farming much past 65 while with our 19 employees doing
a lot of the hard work, we can continue longer. This allows
more equity to be built up to help transfer the assets to
future generations. Productive learning experiences for this
generation of migrant workers can lead from labor to management
to ownership in succeeding generations--just as was the
progression for previous generations of immigrants.
If the Federal government recognizes this, policymakers can
aid in the development of programs to assist the transition. Of
course, a sound approach to immigrant workers would be the most
helpful.
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Responses to Senator Casey's Questions from Isaac Kershaw
Question. How can we better educate and train our young
people to prepare them for careers in farming and agriculture?
Answer. Increasing student access to quality secondary and
postsecondary agriculture programs will help to address the
shortfall of young people interested and capable of entering
farming and agriculture. There are several things that can be
done to significantly strengthen the quality of and increase
the capacity of programs that prepare students for careers in
agriculture, food and natural resources.
Quality Instructors. Quality programs cannot be sustained
without quality educators. There is a shortage of agricultural
educators across the country. This shortage is not anticipated
to diminish anytime in the near future. Thus, there is a need
to support teacher education institutions in their efforts to
recruit and prepare young people to teach agriculture. At the
same time it may be necessary to invest in alternative ways to
attract and prepare qualified individuals, who have experience
and education in agriculture, into the teaching profession.
Attainment of the right knowledge and skills. There is a
need to support the development of technical content standards
that clearly identify what students should know and be able to
do in order to be successful in the agricultural career of
their choice. This includes the technical, academic and general
workforce development skills that form the basis of a wide
range of careers in agriculture. The National Council for
Agricultural Education is currently trying to raise the funds
and build the partnerships necessary to develop the content
standards related to careers in agriculture, food and natural
resources.
Curriculum Development. There is need to support the
development of instructional materials that enhance a teacher's
ability to facilitate learning. The National Council for
Agricultural Education is partnering with agribusiness and
state government to develop a science based curriculum to
better prepare students for careers in agriculture that are
deemed to be in high demand and highly skilled.
Measurement of Knowledge and Skill Attainment. The
availability of industry based certification assessments that
are applicable to secondary and postsecondary programs in
agriculture is very limited. Students, school districts, state
departments of education, and the business community all stand
to benefit from the use of quality assessment instruments that
effectively measure student competence.
Students stand to benefit from the use of certification
examinations when such tools provide feedback on level of
competence and offer a means to demonstrate to others that
significant levels of achievement have been met. Of particular
value is the portability of industry certifications among
businesses across a state and throughout the nation.
Innovative Program Design including Alignment with
Postsecondary Programs. Support is needed to explore and
implement new and innovative program models in agricultural
education. It is necessary to rethink how agricultural content
is delivered to students who are enrolled in schools that have
not been traditionally served through agricultural education.
It is essential that secondary agriculture programs coordinate
their efforts with their postsecondary counterparts so that
students benefit from a seamless educational program.