Statement on Signing the Food, Agriculture, Conservation, and Trade Act of 1990

I am pleased to sign S. 2830, the "Food, Agriculture, Conservation, and Trade Act of 1990." This Act represents the culmination of many long months of effort by the Congress and the Administration. The effort has been worthwhile, for this farm bill addresses several goals, shared by my Administration and the Congress: keeping American farmers competitive in world markets, assisting farmers in their efforts to protect our environment, and stabilizing the farm economy and our food supply. I also applaud the reauthorization of the nutrition assistance programs vital to the good health of our low-income Americans.

I am most pleased with those aspects of the 1990 farm bill that continue the market-oriented shift begun in the 1985 legislation. Increased planting flexibility, farmers' control over their own production decisions, and greater reliance on signals from the market rather than on Government support programs are key to this market-oriented shift. Increased flexibility in planting choices contained in the 1990 farm bill will allow farmers to break out of the traditional farm program straitjacket, which bound them to produce the same crop year after year, regardless of market opportunities.

In the Uruguay Round, we are committed to reducing market barriers and export subsidies that deny our farmers competitive access to market opportunities around the world.

Agriculture will greatly benefit from the reduction of the Federal deficit because interest rates and inflation will be less. For every percentage point that interest rates fall, farm income is estimated to increase by three-quarters of a billion dollars annually. For every percentage point shaved off inflation in the cost of production, farm income is estimated to grow by one-half billion dollars annually. American farmers have always made the most of such opportunities.

From a budget perspective, the reductions in spending in this bill and in the related provisions of the Omnibus Budget Reconciliation Act of 1990 -- a total of around $13 billion over the next 5 years -- will assist in the effort to reduce the deficit and reduce interest rates and inflation.

Planting flexibility available through the 1990 bill provides a further important step in harmonizing the protection and enhancement of the environment with commodity support programs. Farmers have always been recognized as stewards of the land, and now I call upon them to continue their leadership. Many provisions of this farm bill will help farmers protect water quality and wildlife habitat. Greater planting flexibility will boost the use of crop rotation, which will in turn enhance soil fertility and aid in the control of weeds, pests, and soil degradation. The Congress reaffirmed its commitment, which I share, to the preservation of wetlands in establishing goals for enrolling land in a Wetland Reserve Program.

The forestry provisions of the farm bill provide the authorization for my America the Beautiful Initiative. Although appropriations to date may not be sufficient to ensure that my goal of planting one billion trees annually is fully met, strides in that direction are incorporated in the legislation. I will continue to work with the Congress to see that our mutual concerns for our Nation's forest resources are fully met.

I am particularly pleased with the 5-year continuation of the food stamp programs, the foundation for food assistance for low-income Americans, and the reauthorization of the Commodity Supplemental Food Program, the Emergency Food Assistance Programs, and the Food Distribution Program on Indian Reservations. The Congress, the Administration, and the States worked together to enhance food stamp program integrity to ensure that benefits are used as intended. Coupled with last year's reauthorization of the Child Nutrition Program, and the Special Supplemental Food Program for Woman, Infants, and Children, the Nation's food assistance programs are now in place for years to come, ensuring that the bounty of American agriculture is shared with all Americans. However, I am concerned that the bill forgives the States' obligations to repay the Federal Government for past errors in payments. Given the demands on Federal resources, everything possible must be done to require their efficient and fair use.

I am also pleased that this farm bill reforms and streamlines the administration of our overseas food aid programs and continues our export programs that keep American products competitive in world markets. Of particular importance to me are provisions that would implement parts of my Enterprise for the Americas Initiative aimed at helping Latin American and Caribbean countries and grant authority to reduce needy countries' debt repayment obligations under the Food for Peace Program.

I am also pleased that the Congress has endorsed the Administration's initiative for growth in the size of the competitive research grant program for agriculture. Only by ensuring that the best minds produce the best science can we build a secure foundation for future technological advances in farming. However, while the Federal Government has a critical and unique role to play in supporting such basic science. I do not see a corresponding need to subsidize private sector activities in product development. Consequently, while I strongly favor the idea of commercializing emerging innovative technologies, I do not support the establishment of the Alternative Agricultural Research and Commercialization Board to provide federally subsidized grants and loans to the private sector for this program.

Some aspects of the rural development title will help to improve the economic vitality of rural America. In particular, formation of a new Rural Development Administration presents an opportunity to improve coordination of important community and business programs. However, many other rural development provisions could greatly increase Federal costs without necessarily improving the welfare of rural America. In particular, the provisions regarding rural telephone loans represent unwarranted increases in Federal subsidies and risk. Telephone borrowers, many of whom are large and profitable holding companies, can now use Federal loans to build office buildings, can determine their own loan terms, and can have their required debt service margin reduced. These changes reduce the Administration's ability to manage properly telephone loan risk, and in effect turn control of the program over to the borrowers.

I also note that in enacting amendments to the law governing the Rural Telephone Bank Board, the Congress provided that the members of the Board would exercise management authority "within the limitations prescribed by law." Consistent with my obligation to construe statutory provisions to avoid raising constitutional questions, I construe this savings provision to embody the recognition that those Board members not appointed in conformity with the Constitution cannot exercise the authority vested by the Constitution in officers of the United States.

I further note that a number of other provisions of the bill could be construed to vest governmental authority in private parties. These provisions appear to raise constitutional concerns, and I am accordingly directing the Secretary of Agriculture to consult the Attorney General to consider whether curative legislation or other action is needed to ensure that these authorities are exercised as the Constitution requires.

In spite of these drawbacks, on balance I have before me a farm bill that will enhance the competitiveness of our farmers and the health of our citizens. My gratitude goes to those who have worked so tirelessly to produce this legislation: concerned citizens, Members of Congress, and my own Administration. I look forward to continued prosperity in the agricultural economy and good health and nutrition for our citizens.

This is not a perfect farm bill either from my perspective or from that of many Members of Congress. But the vision of all who worked on this legislation is the same: prosperity for our agricultural sector and the nutritional well-being of our people. The bill before me is faithful to our shared vision.

George Bush

The White House,

Nov. 28, 1990.