STATEMENT OF HON. WILLIAM G. SCHERLE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF IOWA

Mr. SCHERLE. Mr. Chairman, thank you very much. I will try to be very brief this morning, because there are a great number of colleagues, and other people outside the legislative branch, that would like to testify.

Before I begin, Mr. Chairman, I will ask permission that my statement be included in the record. May I just visit with the committee on a personal basis?

The CHAIRMAN. Without objection, that will be the procedure.

Mr. SCHERLE. Mr. Chairman and members of this committee, it is always a distinct pleasure to appear before such an outstanding group of men, as knowledgeable as you are in your field. As a grain and livestock farmer, no one could appreciate more the dedication and conscientiousness that you men have placed at your responsibility. In behalf of all my people in rural America. I thank you very much for your supreme effort, dedication, and consideration.

We meet this morning, not with a great deal of joy but with a great deal of concern, over what is happening to agriculture and rural America. The elimination of the REAP program is not just the elimination of a program for farmers. In essence, its elimination and abolishment is nothing more than a rape of rural America. That is exactly the way we envision the demolition of this program.

I feel very indebted to the great chairman, with his vigor and vitality, in bringing this problem as expeditiously as he has before this committee. He is trying to correct a very horrible lack of reasoning of this administration.

I also had introduced legislation very similar to that of the distinguished chairman and, at this point, we have, as cosponsors of my bill, 71 Members of the House. The interesting thing about the sponsorship of this piece of legislation is that it is not partisan. It is not Republican, gentlemen, it is not Democrat-it is not rural nor is it urban. It is a combination of everyone who realizes the damage that will be inflicted by the elimination of this vital environmental program.

On this bill we have 43 Democrat and 28 Republican cosponsors. Mr. Chairman, if this committee approves this bill, it will go through the House, and the Senate very quickly with a lot of support. There is no pride of authorship, Mr. Chairman, in our legislation. All we would like to see is results. My farmers want this program reinstated-and the sooner, the better. We have had a great deal of devastation in my State and in my district last year. We had, at one time, 24 inches of rain in 2 days, which completely destroyed crops, homes, feedlots, and everything else.

Mr. Chairman, what are the reasons behind the elimination of this program? For instance, the fact sheet on the termination of REAP by the U.S. Department of Agriculture, says farmers are better able to pay for conservation practices than ever before. Farm income for 1971-72, they say, was up about $3 billion from 1971.

Well, Mr. Chairman, as a livestock and grain farmer, I would certainly have to agree with those figures. But what was our year in 1971 ? What was our year in 1970? What was our year in 1969? And gentle

men, what will our year be in 1973, 1974, and 1975? How can you pick 1 year out of all the bad years we have had and look in the crystal ball and say, because the farmer made more money in 1972, he can pay for the practices which not only rural America has benefited by, but the consumer has benefited for 37 years because of this program? There is no country in the world that spends less than 16 percent of the disposable income for food except here in the United States of America. Why? Because in part of the great work of this committee, because of the programs and the projects that have been initiated because of the need and, of course, the great increase of productivity by the farmer himself.

Sure, we made $3 billion more this year than we had last year. But by the same token, so have our costs gone up to the same extent. That increase is not all profit.

The average income for the farmers in rural America, 1971, was about $5,200. Yet 52 percent of that amount of money was money made off the farm, where maybe the wife taught school, or the husband had another job. Fifty-two hundred dollars. This year, I am sure, perhaps, it might be up around $6,500 or maybe $7,000. You still cannot live on that amount of money. The consumer really is a beneficiary of the work we do on our farms. How in the world can we be expected to retain the land which is necessary for survival and existence on $5,200 or $6,000 or even $7,000 a year?

Do you know what it costs a bulldozer today to come on your farm? It costs about $20 an hour. That is minimum. If you are going to build a terrace or a diversion ditch or any needed work for the retention of soil for posterity, you just can't afford to do it all yourself.

Now, some may say, well, the Government pays only 30 percent. Gentlemen, that is what he needs. He will spend the 70 percent of his own funds to do this kind of work. Which benefits all Americans. You should not expect the farmer to pay for these conservation practices all by himself.

Let me pursue this a little further. The remark was made by the Secretary, Mr. Chairman, when he testified before this Committee, that only 20 percent of the farms in the United States participate in the program. This is very simple. If you do not have the money, you cannot participate. I called my ASC office this morning and asked the manager, how many farmers participated in this program last year? She said, 74.

I said, how many applications did you have for participation? She said, over 100.

If we do not have the money, we cannot participate in the program, and this is exactly what is happening today. I have the figures by the Department of Agriculture right here in front of me. In 1971, 40.8 percent of the farmers eligible in the United States participated or wanted to participate. They could and did not because the program did not have sufficient money. I serve on the Agriculture Appropriations Committee. We approved $225 million for the needs of this country, not only for rural America but for urban America. The fact of the matter is that this program helps all America; it always will.

If you do not give the farmer opportunity to make a small return on his substantial investment, you are going to find grass growing on the streets of every city and town in our Nation. We have been asked

to feed the world, and we can do it, and we will. But we cannot if we do not have the necessary income that it takes to preserve our land, and to take care of our other responsibilities. We have lost 23 million people off the farms since World War II. We still lose on an average of about 250,000 people a year that leave the farm. We recognize we only represent 4.6 percent of the total population in the world today. You talk about minorities-gentlemen, we are a minority. But we are a necessary minority. We are the type of minority that keeps people alive and happy. We provide the greatest health and well-being of any person in this United States.

Why should the little farmer be penalized? This is exactly what could happen by the elimination of REAP. I would not care if some real thought went into this decision. But unfortunately, we do not have anybody at the White House who knows what agriculture is. That is what bothers me more than anything else, because without food and

fiber there is no survival.

I feel sorry for Earl Butz. The Secretary is between the rock and the proverbial hard places we hear so much about. He has to maintain his loyalty to the White House and he also has to maintain his responsibility to his constituency. I do not know how a man is going to serve two masters. It is going to be real difficult. The Secretary himself must cringe sometimes by the orders that are given him. I can't help but believe that all the damage that is contemplated is not recommended by the Department of Agriculture. They are in a better position of knowing what we need than the White House staff.

Mr. Chairman, if you just check the record, you will see that the people living in rural America are much poorer than people living in any other area in the United States. A lot of time they do not recognize they are poor until someone tells them they are poor. They have great pride, great dignity, great dedication, and great love for what they do. But they need help and the elimination of REAP is not the type of help they need.

I am a little worried about 1973 because of the recommendations made by the Office of Management and Budget.

Now, just in the last 60 days, here is what has been done. The U.S. Government has called up all the warehouse and farm-stored corn for 1969 or 1970 or 1971 and there is question about 1972. They removed the set-aside requirement for the 1973 wheat program, thus freeing additional acres for production. They have increased imports of dry milk. They have increased the interest rates that farmers pay on commodity loans from 3.5 percent to 5.5 percent each year. They have discontinued all wet facilities. Those of you in the agricultural belt know that we have had a lot of rain. There has never been so much moisture carried in grain before as there has this year. Yet they have discontinued the wet storage facilities.

They have reduced the production payments by about $1 billion. Payments in the past, gentlemen, have totaled about $4 billion. They cut them by 25 percent.

They eliminated quotas on meat and increased the voluntary level and, at the present time, there is over 16 percent imports coming in. Gentleman, are any of these things done to enhance the income of the farmer? You tell me how you can enhance the income of the farmer by submitting these recommendations, which result in nothing but overimport and overproduction.

They allow us grazing on set-aside acres on a year-round basis. What does this do, gentlemen? It encourages the production of beef cattle, cow-calf operations. Now, do you think that the people that are paying us to take land out of production are going to relish the idea that the Government is also going to allow grazing those same diverted acres? I am totally opposed to it.

The Government is also seriously considering allowing us to grow soybeans on diverted acres.

They have tried to limit the export of hides. And once again, I appreciate the help of this committee and the wisdom of the House and the Senate to reinstitute the old program and put the ultimate responsibility back in the hands of the Department of Agriculture. In the past this was done by the Department of Commerce.

Then they have reduced the set-aside program from the mandatory 25 percent to 15 percent. All this is done to encourage additional production, additional crops. Based on 1972, gentlemen, the Government predicts that the exports are going to be more than even. They predict about 875-million bushels of corn to go overseas. They anticipate 4.2 billion right here in this country. And I predict that by this fall, with the vital elimination of the set-aside program, we will have close to 6.2-billion bushels of corn, the highest surplus of any year we have ever had. And, gentlemen, there is no way-no way-that the price of these commodities can remain the same. I do not believe that those countries that have bought our crops and our grain in 1972 are going to do it in 1973 if they have no need for it.

One additional problem faces the exporters. Even if you were to have. orders for another 875-million bushels overseas, you are going to have a potential breakdown of transportation, either by strikes or just plain inability to move the material. Just check with your local elevator today and find out how many boxcars we are getting every day of the week. If they can't get boxcars, gentlemen, they can't move or sell it. These elevators and warehouses are in jeopardy today.

Now we want to eliminate REAP. This is the most assinine thing that I have ever heard in my life, a practice that has contributed a lot to this country. There may have been some abuses in our agricultural programs. I would be the first to admit it. But, gentlemen, a program that has proven itself time after time after time. Four Presidents tried to eliminate REAP but because of the wisdom and knowledge of your committee and Congress it has been retained. Gentlemen, I would hope that you, also, will give this bill your overwhelming favorable, and affirmative support in the committee, and on the House floor. Let's give the farmers of this country a break. You have been great to them in the past; they have appreciated what you have done. Gentlemen, do not let them down now.

(The complete statement of Mr. Scherle follows:)

STATEMENT OF HON. WILLIAM J. SCHERLE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF IOWA

The Rural Environmental Assistance Program, established in 1936 to help farmers repair the damages of the Depression, has proved its value over and over again, not only to the agricultural community but to the entire country. Under its provisions, the federal government shares the cost of conserving and enhancing our natural resources of land, water and air with close to a million farmers, ranchers and woodland owners each year. The benefits of the program are available to agricultural lands throughout the nation and represent

the best resource to help solve agriculture-related pollution problems. Nor are its advantages limited to participating landowners. All America benefits when her precious natural resources are nurtured. We cannot take the fertility of the land and the purity of the water and air for granted. We must conserve as well as cultivate the cornucopia which provides the finest food supply and the most beautiful natural environment in the world. If we fail in this obligation, city-dwellers and suburbanites will suffer as great a loss as farmers and ranchers.

Few people would take exception to that principle, but some may question the role of REAP in the national environmental protection effort. Those of us who work daily in agriculture know its value, but it may be worth rehearsing the accomplishments of REAP for those less familiar with them.

No other government program can claim greater achievement of its goals more economically. In a single generation, the program has aided in the construction of more than two million water storage reservoirs and almost thirty-two million acres of land terraced; the establishment of close to 114 million acres in stripcropping systems and over one million acres of permanent sod waterways; and the planting of ten million acres of trees. Moreover, money allocated to REAP is not so much an expenditure as an investment. What Washington supplies in REAP grants is seed money. REAP operates solely as a cost-sharing program. The farmer bears the balance of the expense and, in addition, provides the labor and management necessary to carry out conservation practices. For example, every $300 in REAP funds generates an estimated $700 in private money. Far from being concentrated in the hands of a few farmers, the federal contribution is shared as widely as possible. In the state of Iowa, over 26,000 farmers participate in the program annually; during a five-year period, however, a total of more than 108,000 people participated one or more times.

Unlike many other government programs of long standing, REAP has proved extremely flexible in adapting itself to the nation's changing environmental needs. At one time known as the Agricultural Conservation Program, the re furbished REAP has done more than merely change its name. It dropped certain low-priority, short-term projects and today concentrates on longer-range and more important conservation practices. REAP now spends almost 96% of its money on such "enduring" practices, up from 92% in 1970 and 87% the year before.

Aid for measures to clean up our waters has risen nearly eight-fold from $1.4 million in 1970, the last year of the old ACP, to $8.8 million in 1971, the first year of REAP. The Department also placed more emphasis on curbing air pollution, assisting orchard owners to clear their land by non-polluting methods. One of the fastest growing REAP projects is in improved animal waste and solid waste disposal structures, an area recently assigned high priority by the Environmental Protection Agency.

Despite the demonstrated value of REAP, it has rarely been popular with executive branch budgeteers. That the program has survived at all is a tribute to its enduring esteem among members of Congress rather than the administration. In recent years, especially, the Office of Management and Budget has repeatedly redlined REAP. impounding all or part of the funds in a misguided effort to cut costs. No one is more dedicated than I to the principle of economy in government. But no single department should be forced to bear a disproportional share of the burden. If the administration view prevails, the agriculture budget will suffer a one-and-a-half-billion-dollar reduction. In the past decade, agriculture's share of the federal budget has shrunk from 4.4% to 2.1%, a reduction of more than half in ten short years. REAP is only one victim of the purge, and a comparaitvely small one at that, but it symbolizes much that is wrong with the executive's new approach to thrift. Each program should be evaluated on its merits. Those that have proven their worth over many years, like REAP, should be retained.

Together with close to seventy members of the House representing the broadest possible political spectrum (including nine members of this committee, fortyone Democrats and twenty-seven Republicans), I have therefore sponsored legislation making it mandatory for the Secretary of Agriculture to continue the REAP program at the level we funded. $225 million for 1973. The new, stronger Language of this bill should make it impossible to discontinue or freeze payments for REAP projects.

This proposal will focus a spotlight on the issue of the future role of Congress in the federal system by raising the question of whether the executive branch can eliminate a program voted by Congress for thirty-six years. The bill will