New Crops News, Spring 1992, vol. 2 no. 1
I am deeply interested in this subject and so are many members of the Senate Agricultural Commitee who are prepared to be your champions; we really want to know more. We want to take time to be sure that some of the information you are going to share can receive a proper hearings in the public forum. I am certain that we will come to a day when we will not be immersed in marketing orders of commodities and issues that are politically partisan and somewhat divisive.
In the meanwhile we have a set of emergencies ahead of us. I refer to the breakup of the Soviet Union whose emerging republics confront us with appeals for assistance, specifically food aid to survive the tough winter ahead. The USDA has scanned the various republics and reported to the Secretary of Agriculture and the relevant members of Congress. The reports are ambiguous to say the least. The harvests have once again been very inefficient. And most individual familes are squirreling away whatever they can find-- in houses, basements, or backyards. This is also true for individual Republics; those with wheat are keeping it. And beyond that, those emergency shipments that have been sent by some countries have piled up on ships in docks and even in lesser amounts in airports. It is not clear what to send and to whom to send it. The net thinking thus far has been that we ought to proceed through as commercial an arrangement as we could, namely the guaranteed loan. Earlier in the year the President signed orders for $1.5 billion of guaranteed loans so that the whoever was buying in the Soviet Union, could make their own choice.
Now the problem of all of this is evident. Last summer the issue was on the lips of every farmer who was impatient to know how the government could move on this issue. A half billion dollar loan guarantee was perceived as the salvation of prices and the means to reduce domestic stocks. In the farm bill we just passed is a very important clause which says that you cannot loan taxpayers money unless there is some prospect of repayment, some credibility in terms of credit worthiness. Why would we do a thing like that? We did it because, predictably, in their enthusiasm many farmers and polititicians have frequently urged government loans that had no prospects of repayment. Products moved, producing some value in terms of price in this country but a growing deficit in terms of our federal government. We have been stung by Iraq. When we were asked to give our judgernents about the credit worthiness of the Soviet Union we could only answer "zero." Ultimately, the President of the United States decided, as he always can under national emergency conditions, that it was probably in the best interest of the United States of America to make these loans available.
What do we do next? There aren't any good answers. What we are attempting to do is to send people instead of food. The more profitable route seems to be to send American experts who can stay in the Soviet Union for some months, or even for a year, to try to help them redirect the distribution system. But the system works slowly, two steps forward, one step back. We are trying to help people harvest more of what they've got, distribute it better, store it better, and increase its value. I think we are going to make some headway that will be appreciated. Down the trail, however, the answer to the basic question that all of us have is "Will the Soviets be a better market or a lesser market for us?" The jury is clearly out; one can only assume that in the short run things are likely to remain pretty grim. Political stabilization simply has not gelled.
Finally, we are looking to this conference for new ideas, more diverse options that could flow in a world of freer and fairer trade. We have a great stake in making sure things work out right. I am optimistic ultimately but pessimistic about the next few months. All of us who have any sense of internationalism and a sense of how people around the world might be better fed, have got to be involved.