Collin Peterson (U.S. Representative, MN)

Before ethanol, people in Iowa came to the conclusion that this big glut of corn and soybeans harvested every season is in part because farmers are subsidized to grow those commodity crops. And yet, the fact that there’s this overabundance brings the price down per bushel to the point where they can’t grow it without the subsidies. Subsidies are needed because of subsidies. Is there any truth to that?

Probably to some extent. But, I mean, there’s a lot of different people involved in this, a lot of different interests involved in this. In my view, prior to ethanol, a lot of the pressure and the consequent legislation on the subsidies, was to provide cheap soybeans and corn and wheat, so that you could export it into the world market.

And there’s a lot of infrastructure built up to export, a lot of people saying that the long term future as only if we could export because we were producing more than we could consume. So, for years, we sold corn and soybeans and wheat below the cost of production.

We’ve subsidized the livestock industry. Nobody wants to talk about that. And we’ve subsidized the big exporters. And we gave the farmers these subsidies. It didn’t help the farmers. It helped the livestock people and the exporters. And frankly, I got a problem with us exporting grain below the cost of production, having the government pay for it, I mean. So now, ethanol comes along and changes that. Now, these same guys are upset, because now they have to pay the actual price of corn.

And if we’re able to maintain this, it’s possible we won’t need subsidies. But, I am not ready to say that this is going to be a long-term solution, because people are trying to screw up the ethanol thing, just like they screwed up the other thing with these WTO agreements. So, my position is, we need to keep this floor in case this thing collapses, because one – one thing I know about farmers, when they have a good price, they will over produce, and they’ll drive the price down.

They’re very good at that. But, I wouldn’t say that, I mean, in Iowa, Southern Minnesota even now in the North part of my district, they grow corn and soybeans because that’s the crop that produces the most return. When we beat [couples] in ’96, people did start changing what they planted, and they planted based on the economics.

If there was a real world market, which is another question there, I mean a real fair market, so that corn was sold for what it actually cost to produce it, we wouldn’t need these subsidies. But this whole screwed up WTO government subsidizing, I mean, Europeans are a lot worse than we are.

So, farmers get blamed for something that I don’t really think is their fault. They’re being subsidized because of other interests that the government is pushing, if you will.

Is there an inherent problem between conservation and the subsidies?

Oh, I don’t know if there’s a problem. This, again, I think is driven more by economics than it’s driven by farm policy. I don’t know exactly where he is in Iowa, but there are conservation programs that he could get involved in. And in my home county, where I grew up, when I was a kid, we had soil bank.

We had birds, wild life, all over our county. They got rid of the soil bank in the ‘50’s, late ‘50’s, and we didn’t get it back until the CRP was put in, in ’85. That land became so valuable and so intensively farmed, that none of it went back into CRP or these other things. So, what was tremendous hunting and wildlife when I was a kid is no longer.

You probably have that situation wherever this county is in Iowa. We have the programs available, if farmers want to put aside some of their land to conservation. And, frankly, that’s what’s needed. You’re never going to make this work by trying to manage the crops in a certain way for the birds. I mean, wildlife needs is big tracks of grass, places for them to nest, to hide, you know.

Where we’ve done that, where we had a lot of CRP, the wildlife is way beyond what we’ve ever seen in history: more deer, more pheasants, more wild non-game species. It works. So, those programs are in place. And they’re expanded [unintelligible] a lot in 2002. And in this bill, we’re expanding them another 35% for what they’ve been, you know.

So, we think we’re moving in the right direction, and farmers support that, you know. But I don’t think they support the government coming in and forcing them to do something. And so, we’ve stayed away from that. But, the option is there. And if some county, for whatever reason decides to put the whole county into crops, they might have a problem. But the government’s not forcing them to do that.

Well, you mentioned where there’s CRP’s happening, a lot of these birds and bees are doing okay. I know there’s another program that is based on water sheds, and there are those that say that it’s a trickle of the funding that’s needed exists, and that a lot of these programs get flat-funded.

It’s got some potential. I was not a big fan of the program, the way that it was developed. And in the farm bill that we passed in the House, we made significant changes to how that program operates. And everybody that’s looked at it says that the program will be a lot better, given the changes that we put in place. So, Senator Harkin [phonetic], this has been his deal.

And we’re going to put more money into this. And we’re probably going to go nationwide, instead of being limited to watersheds. That’s okay. One of the issues that is out there, with some farmers, is that they feel that this gives too much control to the government, because in order to get this program, you’ve got to go in to your NRCS and get a plan.

And some farmers just don’t get along. And so, that’s going to be there. But it’s a program that encourages no tale [phonetic] farming and leaving residue on, and doing the right kind of practices. And I think I support that. Farmers support that. The only thing they’re a little concerned about is that it gives the government too much control.

And there’s some people that worry that some of the kind of big city environmentalists that really don’t understand what’s going on, are going to interject themselves. These folks in the big cities they, they think that they know better than we do how things should be done.

And a lot of them really don’t know what’s going on, you know. So, there’s a little concern that if we get the C2 agenda up, it may come back and backfire on us.

A lot of small farmers that we’ve met, both in California, especially crops, and in Iowa, some commodity growers, they feel like they’re at a little bit of a disadvantage in terms of how the farm bill ends up panning out, in terms of having their interests represented. And for this reason, they feel like (a) they don’t have the money to contribute to political campaigns that the bigger players have, and (b) or to hire lobbyists in the numbers that the bigger players are able to do.

Well, the only people that hire lobbyists are the commodity groups, which represent the corn growers, soybean growers. So, if you ostensibly, if you grow corn, soybeans, wheat, you’ve got a lobbyist that represents everybody. Now, they may not like what that lobbyist does, because they’re influenced a lot, those [unintelligible] groups by the big guys, [unintelligible] and so forth, you know.

But I have tried to stay away from this big farmers/little farmer. I think that’s a very problematic thing for agriculture. There’s so few of us that represent agriculture, and are, we’re such a small part of the population, that we can’t afford to be fighting amongst ourselves. And I’m not for or against big farmers or small farmers. I’m for farms that make economic sense, that work.

And you’ve got some small farms that are doing very well, because they’ve got indoor organic, grass-fed beef, whatever. You’ve got the traditional farmers that have been, by economics, forced to go to bigger operations to make things work, given the prices, where they’ve been. People are diversifying, buying into ethanol plants, which is helping.

Our farm program is not a social welfare program. It’s, it’s a program to under-gird and put a safety net under production/agriculture. And that safety net is the same, whether you have 100 acres or 2,000 acres. You get into this whole payment limit debate, I am not one that believes in that, because again, and I don’t think this is a social welfare program. What I would like to see us do, is eliminate payments for people that are not farmers.

And we’re making payments to people that aren’t farmers, and I’d just soon get rid of. Yeah, but, we haven’t gotten there yet.

The complaint that we heard a few times in Iowa, is that some of the larger players are getting, of course, more subsidies. They’re taking that money and buying up land around them. Their subsidies increase, and so there is concern about the caps and all the loopholes.

Well, yeah. But I think that’s really overblown. To say that the direct payments that go to corn, for example, which was 20 bucks an acre, to say that because you, you go out an buy an extra thousand acres and you get $20.00 and acre, that that somehow or another is what gives you the opportunity to buy more land that’s not true.

I mean, again, this is driven by economics, by economies of scale, by us keeping prices low, and forcing people to produce more, to have bigger operations in order to try to make it. I think that the best thing we can do to keep farmers smaller is to pay them the right price. I mean, if they get $3.50 for corn, which is what they need, then there won’t be any need for payments, you know.

But, you’re still going to have bigger operators coming in and buying and probably having more money than smaller ones. You also have a lot of city people coming out and buying up this land. And like, up North in my district, I just bought some land for hunting, and not too long ago. Up there, hunting land is worth $750 an acre more than farmland.

Farmland is $750 an acre, hunting land is $1,500 an acre. That’s going on. So it’s a complicated issue. But, I think that it’s really a stretch to say that these payments are what’s driving people to buy more land. I think that’s a stretch.

They were also saying cash rents are going up.

Well, yeah, if we eliminate farm payments, cash [unintelligible] will go up even more. I mean, you got a lot of people that are not farming, that are getting the payments and, and share cropping with a renter. If it’s being done right, they’re taking, like, if they’re a third, they’re taking a third of the risks. They’re taking a third of the seed and fertilizer and expenses, and so forth. If you eliminate those guys, and they still own the land, they’re going to charge more rent.

So, I mean, if you eliminate farm payments, you’re actually going to drive up cash rent. And I’ve heard that from farmers, too. You’ve got some people that are on ideology with some stuff, and it maybe sounds good in it’s populist and all this sort of thing. But, you look into it, what we’re trying to do is put, put a safety net in place that’s not used unless it’s needed, you know. Like, these direct payments, I think are hard to defend when you have high prices, but nobody wants to give them up.

And I tried to eliminate direct payments on anybody that had less than 20 acres, and where I got the pushback? From the small farmers. Well, I think it’s hard to argue that if you’re only getting payments on 20 acres, that that’s going to make or break you. But, just making that small change, I was stopped from doing it.

There’s a perception that members of Congress on AG committees are getting sizable hunks of campaign money from the agricultural sector. There are some that think that that is a conflict of interest.

Well, we represent agricultural areas. And, the people that are making these contributions are our constituents, you know. Now, they might be doing it through the pack of their national organization, but the corn growers, soybean growers, berry people, sugar beet people, Ducks Unlimited, Pheasants Forever, all of these people that are interested they have a huge amount of members that are in my district.

And I’m on the AG committee because my district is a big AG district. And I don’t know how you separate all of that. I mean, I think it’s the other way around. I think that if you understand agriculture, you work hard for agriculture, if you’re somebody that they think understands this and has got the right perspective, then you’re going to get support, not the other way around.

I mean, it’s not like, from my point of view I don’t look at something about how much money I got from some group as to decide how I’m going to do something. What I do is what’ s right for the district first. Then, now, in my job as Chairman, I have to look at the whole country and figure out a way to get something together that works for everybody.

But if, if you do that, you do your job, and the support comes. I think it happens in a lot of different areas besides agriculture.

If I had my way, we wouldn’t have any contributions. We’d have public financing, and we’d end this issue. I’m for it, 100%.

I was in the legislature and we have public financing of a sort. And so, a third of our money, 40%, comes from public financing. The rest comes from, you know. In the legislature, I never even knew where the money came from. The money just came in. And I always had enough to campaign. I never asked anybody for money. It just worked. When I first got here, I had to make calls to try to raise money.

Now, the money just comes in. I don’t even know where it comes from. It goes to my treasurer. I don’t worry about it, you know.

And, oh, I’m lucky. How these guys can do it, when they have to get on the phone and call all these people. That’s not a good thing. But I am for public financing. I’ve seen it work in Minnesota. I’ve been on bills out here to go to public financing.

I think it’s the way we should go, and we’d eliminate this problem. And people could do their job.

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