Farm Legislation Letter to Congressional Leaders Concerning the Administration's Position on H.R. 6782.

Sixteen months ago, I asked Bob Bergland to join with the Congress to help restore a sense of direction and purpose to the farm and food policies of this nation. The extreme volatility of farm and food prices of recent years has not been in the best interest of either our Nation's farmers or consumers.

When we took office, farm income was in sharp decline. We undertook to reverse this trend and return stability to the nation's farm economy. Working with you and other members of the Congress, we developed the most sweeping farm legislation of the past 40 years. Using the authorities of that law, we have moved to improve the incomes of America's farmers.

This policy is working. Our agricultural economy has improved markedly in recent months. To further strengthen this recovery, we announced last week:

• an expansion and liberalization of the farmer-held grain reserve.

• paid diversion of 7 to 9 million acres of excess cropland.

• and other steps winch, in combination with the reserve and the acreage diversion, will add up to $4 billion to crop producer income.

These are carefully considered measures. They will provide decent farm incomes, protect consumers from precipitous price rises, enhance our reliability as a major agricultural exporter, and allow us to meet our humanitarian food aid commitments.

Yesterday a conference committee of the Congress reported H.R. 6782, legislation that was hastily drafted in an atmosphere of emotion and confusion. Should that legislation reach my desk, it will be vetoed.

No one who understands our farm economy should be deceived about the impacts of this measure.

• It would increase food price inflation to double digit levels.

• It would add as much as $6 billion to the Federal budget.

• By sharply reducing production and increasing prices, this bill could seriously undermine our competitive position in world markets.

• The higher feed prices that result would adversely affect our own livestock industry.

• It would require vast new layers of bureaucracy to administer the complicated and confusing schedule of eligibility requirements and payments.

• And, this bill would direct the vast majority of its benefits to a small number of the very largest of our farmers, rather than those in greatest need of help.

This Administration is committed to a strong and prosperous farm economy and one that is able to compete successfully in international markets. We now have a policy to accomplish this objective. I call upon you and other members of Congress to join with me in supporting this policy and in defeating this conference committee bill.