Floor Statement Of Senator Patrick Leahy In Support Of The Jeffords-Leahy Milk Marketing Order Reform Amendment To FY2000 Agriculture Appropriations Bill

August 09, 1999

[Sen. Patrick Leahy (D-Vt.), a senior member of the Senate Agriculture Committee and chief author of the original law authorizing the Northeast Dairy Compact, is cosponsoring an amendment offered Monday by Sens. Trent Lott (R-Miss.), Jim Jeffords (R-Vt.) and others that prevents the Secretary of Agriculture from further implementation of milk marketing order changes for Fiscal Year 2000. Because the Northeast Dairy Compact expires concurrent with the conclusion of the milk marketing order rule-making process now nearing its end, the Jeffords-Leahy amendment would allow the Dairy Compact to continue for another year, while preventing the Secretary of Agriculture from implementing further milk marketing order changes with Fiscal Year 2000 funds from the agriculture appropriations bill.]

Mr. President: I strongly support this amendment which will help dairy farmers across the country. I think that the least the Senate should do when debating a relief bill for farmers is to not reduce farm income. The Department of Agriculture's (USDA) milk marketing order -- the so-called modified "Option 1-B" -- would reduce farm income by about a million dollars, per day. That doesn't sound like farm aid to me. It sounds like a recipe for disaster.

Why should dairy farmers in Mississippi, North Carolina, Georgia, or California, for example, have their income cut by USDA rules when other farmers will get helped under this bill? I think dairy farmers are as deserving as other farmers.

Isn't it enough that the price of milk paid to dairy farmers dropped by almost 40 percent recently? Why should the Secretary be allowed to change current policy to punish dairy farmers even more by reducing their income?

Sixty-one Senators signed a letter to Secretary Glickman opposing the cuts in farm income that would result from implementing the so-called Option 1-B. Those sixty-one Senators pointed out that "dairy farmers . . . are receiving essentially the same price for their milk that they received fifteen years ago while the cost of production has increased. Option 1-B would further reduce the price of milk received by farmers in almost all regions of the country, thereby reducing local supplies of fresh, fluid milk and increasing costs for consumers."

This amendment -- the Lott amendment -- mandates that current law be continued and that Option 1-B be put on ice.

I must also address some unfortunate misinformation that is being spread about this amendment. We received a "Dear Colleague" letter from Senator Feingold that incorrectly suggests that the Lott amendment would terminate the milk marketing order system. That, of course, is not the case. Probably only a few senators want to eliminate milk differentials and the marketing order system. The great majority of senators, including myself, believe that this is not the time to terminate the milk order system.

The Lott amendment would not terminate that system and a letter from the General Counsel of USDA that is being used by opponents of the Lott amendment does not even make that point. Indeed, the General Counsel says: "the issue of whether the statutory language also prevents the Secretary from rescinding the order presents novel questions which will require further analysis."

But, we already know this amendment does not terminate the marketing order system since it is drafted the same way we drafted a similar extension of the milk marketing order system last year. Section 738 of last year's appropriations bill provided a similar extension. No one at USDA argued that last year's extension terminated all milk marketing orders.

Indeed, Congress can pass laws that supercede rules issued by departments. Of course any drafting glitch could be fixed at a House-Senate conference committee, but there is no glitch since we are simply extending current law, just like we did last year.

I want to address other misinformation that is being spread. Some have been saying that the amendment could mean higher prices for consumers.

I will compare milk prices in New England against the Upper Midwest any day of the week. A General Accounting Office (GAO) report dated October, 1998, compared retail milk prices for various U.S. cities. For example for February, 1998, the average price of a gallon of whole milk in Augusta, ME, was $2.47 per gallon. The price for Milwaukee, WI, was $2.63 per gallon. Prices in Minneapolis, MN, were much higher -- they were $2.94 per gallon.

Let's pick another New England city -- Boston. The price of a gallon of milk was $2.54 as compared to Minneapolis, MN, which was $2.94 per gallon.

Let's look at the cost of one percent milk for November, 1997, for example. In Augusta, ME, it was $2.37 per gallon, the same average price as for Boston, New Hampshire and Rhode Island. In Minnesota, the price was $2.82 per gallon.

I could go on and on comparing lower New England retail prices with higher prices in other cites for many different months. It is clear that our Compact is working as it was intended to by benefitting consumers, local economies and farmers. I will submit a lengthy list of additional price comparisons to prove my point for the record.

I want to conclude by saying that sixty-one senators warned the Secretary of Agriculture to not cut farm income by implementing Option 1-B. What we are offering today is narrowly tailored, sensible and modest. Punishing farmers in New England and other regions of the country is not disaster relief. It will only reap another disaster. I urge my colleagues to join with me in protecting farm income for dairy farmers by voting for this amendment.