Statement of Al Spinks

Midland, Texas

before the

House Agriculture Committee

San Angelo, Texas

May 9, 2006

 

Mr.Chairman, members of the Committee, welcome to Texas and thank you for holdingthis hearing. It is a real honor to have the opportunity to testify before theHouse Agriculture Committee.

 

Fortwenty years, I farmed cotton along side my father until his death last summer.During that time, we each had our own operations and farmed some land inpartnership, about 3000 acres in total. My father and I employed two brotherswho have each worked for us for more than 15 years. The additional help we havehired during busy times is nearly always from their extended family. Theoperations we developed, and which are now consolidated, are the very definitionof a family farm. Until five years ago, all my cotton was irrigated; however,because of persistent drought and rising fuel and fertilizer costs, I wasunable financially to continue irrigating. In 2002, the first year of thecurrent farm bill, I saw the opportunity to cut costs and began drylandfarming. Because the payments were decoupled from production, I was notpenalized for producing less cotton. Instead, I was able to make businessdecisions based on the market price of cotton and my production costs. I choseno longer to irrigate mainly because of the higher costs associated with irrigation,but also to let my land rest and recover from years of irrigating with waterthat is a little too salty.

 

Thecurrent farm bill has been and is the best farm bill for family farmers period.The combination of the marketing loan, counter-cyclical payments when pricesare low, and a direct payment for stability is a sound foundation and isworking well. Another successful aspect of the current farm bill is that whenprices increase I am able to take more of my income from the market withoutsacrificing the security of the safety net that is ready to kick in when pricesgo down. It is imperative that the current law continues to operate withoutmodification through its scheduled expiration with the 2007 crop.

 

Itis also important that payment limitations, which already unfairly penalizemany growers, not be reduced further and that current eligibility requirementsbe maintained. I am very concerned by annual proposals to further tightenlimitations on benefits or limit eligibility to the loan. This past July, myfather died of prostate cancer. I am the only child and only heir and am nowfacing the prospect of much of this consolidated operation not being eligiblefor government support because of payment limits. I understand the rational andpolitical posturing that created the current payment limit structure, but itsimply does not work on my farm. Some argue that payment limits penalizesuccess. That may be true in many instances, but it is not the case on my farm.On my farm I have been adversely impacted by payment limits even though my farmhas been barely large enough to provide the margins necessary to cover myfamilies' living expenses.

 

Thesafety-net features of the farm bill are very important to me. Affordable,effective crop insurance is essential in our area, given the extraordinary riskof weather-related losses. The combination of federal crop insurance programand the protection from low prices provided by the loan and counter-cyclicalpayments have helped keep not only me, but also most farmers in my region, inbusiness despite a persistent and nearly devastating drought. I also encourageyou to look for ways to develop a permanent disaster program and to continue toencourage the development of innovative new crop insurance products such as thecombination policy developed by Representative Neugebauer.

 

Tosubsidize my farming operation, ten years ago I began a small business thatprovides liquidity for farmers in need of cash. During the last couple yearsof Freedom to Farm, farmers going through a divorce regularly contacted me. Iam not saying a bad farm bill was the cause of these family problems, butfinancial stress must have exacerbated the situation because I have not beencontacted by a farmer going through a divorce for more than three years. I saythis because much of the support for the farm bill comes from those thatsupport rural development and rural communities. I believe that keepingfamilies strong is a key for the future for rural areas.

 

Anotherpart of the agriculture landscape that needs to be addressed is energy. Notthat high-energy costs are a bad thing for my hometown of Midland. My friendswho lived through ten-dollar oil without the government interfering should beallowed to live through sixty-dollar oil also without the governmentinterfering. However, I highly recommend that alternative sources of energy notonly be explored but also aggressively pursued. Wind energy is successfullybeing developed throughout much of West Texas; I hope that bio fuels closelyfollow. Rural America will benefit from gains in these areas, as will all ofAmerica as we develop less reliance on foreign oil. The new farm bill shouldcontinue the push toward renewable energy.

 

Conservationprograms such as the Environmental Quality Incentives Program (EQIP) and theConservation Reserve Program (CRP) are a vital part of the farm bill. We havesuccessfully reduced soil erosion and improved air quality through the CRP andhave improved the effectiveness and precision of our irrigation practices withthe cost-share assistance provided by EQIP funds. Conservation programs shouldbe operated on a voluntary, cost-share basis as a valuable complement tocommodity programs.

 

Alsoimportant to my operation is Congressional support of the boll weevileradication program and agricultural research and development. I appreciate thecost share funds provided to APHIS that facilitates operation of the boll weevileradication program. This year, every acre of cotton in Texas is in an activeeradication program. Producers are contributing a majority of the cost forthis highly successful program, but USDA's cost-share is still a critical partof the programs success. It is a pleasure to think that with Congress'continued support the eradication of the boll weevil may be just a few yearsaway.

 

Mr.Chairman, research is another important function of USDA so I was disappointedthat the administration's FY07 budget proposal reduces cotton research by 15%;suggests closing the USDA gin labs at Lubbock and Las Cruces, New Mexico; and providesless research funding for the USDA-ARS Cropping Systems Research Laboratory inLubbock. I urge each of you to encourage your colleagues in Congress to rejectthese proposed cuts and closures.

 

Regardingthe WTO, it is good to know that Congress, not the negotiators in Geneva, willwrite our next farm bill. I believe it will be difficult for you to write newfarm law while other are simultaneously negotiating a far-reaching new tradeagreement. I am also concerned that if Congress modifies current law before theWTO negotiations are complete, it could undermine US negotiators' leverage toobtain concessions by our trading partners.

 

TheUS cotton industry has supported the Doha round but I do not think it will beable to recommend that Congress support an agreement that requires cotton toaccept deeper and quicker reductions in domestic support; that does not providesignificant and meaningful increases in market access, particularly in China;and that allows countries like Brazil, China, Pakistan and India to declarethemselves less developed to avoid making concessions of their own. In shortour negotiators need to know that Congress will not accept an agreement thatholds any single commodity to a different standard; does not include acompliance assurance provision; and, lacks real, verifiable gains that benefitU.S. agriculture.

 

Thehistory of farm bills reads like a pendulum swinging from little or no supportto a collection of effective support mechanisms working together. I think itwould be a mistake to swing the pendulum again. As I said when I started, thecurrent farm program is working. I believe that only small changes are neededto meet budget requirements and our WTO obligations.

 

Thankyou for conducting this hearing and for the opportunity to testify. I will bepleased to answer questions at the appropriate time.