November 2, 2007

Dear Colleague:

While discussion of commodity policy dominates much of the Farm Bill debate and discretionary funding, production agriculture remains a comparatively small and shrinking part of the rural economy.  Senator Frank Lautenberg and I, along with a bipartisan group of senators, plan to offer the Fresh Act amendment to the Farm Bill to reform our commodity programs and improve rural development. 

Farm employment has fallen from just over 14 percent of total employment in 1969 to 6 percent in 2005.  The number of counties with farm employment accounting for 20 percent or more of total employment has shrunk dramatically from 1,148 in 1969 to 348 in 2005.  Furthermore, only one in 75 Americans lives on a farm today, and nearly 90 percent of total farm household income comes from off-farm sources. 

Despite this fundamental shift, the 2002 Farm Bill committed 69 percent of total spending to commodity payments, plus another 13 percent to conservation payments.  In all, four-fifths of total funding went to a select few farmers, while only 0.7 percent went to rural development initiatives aimed at boosting rural economies. 

We now have evidence which suggests that direct payments to farmers do not positively impact rural economies at all.  A recent study revealed that most payment-dependent counties did not even match the national average in terms of job growth from 1992 to 2002.  In fact, many experienced losses during that time.  Between 1980 and 2005, the 500 counties that received the most in direct payments reported the slowest employment growth.

Furthermore, most of these payment-dependent counties experienced population losses during that same ten year period.  Such job and population loss figures clearly suggest that our current system of support for rural communities, which relies on subsidies like direct payments, does not work. 

The Fresh Act amendment takes another step forward in addressing the needs of rural America by reinvesting a portion of the savings achieved through the commodities title in conservation, energy and rural development programs.  Specifically, the Fresh Act provides additional funding for the Rural Collaborative Investment Program (RCIP). While a nearly identical program was approved in the 2002 Farm Bill, it was never funded.  Given the demographic transformation our rural communities have undergone, as well as the poor economic performance of those communities, it is clear that we should make this investment a priority. 

The RCIP program would provide rural communities with maximum flexibility, incentives, and resources as they develop and implement comprehensive strategies for achieving regional competitiveness, innovation, and prosperity.  It fosters multi-sector community and economic development collaborations with a particular emphasis on innovation and entrepreneurship.  Leaders in my home state of Indiana launched a similar program in 2005 and have already witnessed a wonderful spirit of collaboration and experienced great success. 

Subsidies to a select few farmers are ineffective in promoting rural development.  Instead, we must provide a safety-net to all farmers, further invest in rural development programs such as RCIP, and encourage conservation and energy initiatives in order to truly advance the economic progress of rural America.  I hope you will join me in maximizing this investment in rural communities by supporting the Fresh Act.