Senate Committee on Agriculture, Nutrition and Forestry
Hearing on the Future of U.S. Agricultural Exports

June 18, 1997

Comments of Chairman Richard G. Lugar Regarding the Importance of Biotechnology

Mention has been made of Dr. Fischler many times during this hearing. Let me just say for the record that this is Dr. Franz Fischler who is now the European Union Agriculture Commissioner and has been such since 1994. Before that he was Austria's minister for Agriculture and a very experienced person in this respect. He did come to our city for a one day visit. It was a very important visit for the reasons that all of you have mentioned.

In my opportunity with Dr. Fischler, which I think in sequence came after the two of you had already had a go at the issues, I tried to sketch a sort of world view that we have been developing in this committee as we take a look at research this year. Essentially, the testimony that I cited in my opening statement was that a number of people have taken a look at the next fifty years have said, in essence, that we need to produce three times as much. That is probably not an exact figure, but it is not far off from what we believe the population projections will be and the income projections of people who are able to afford more food in the world.

The problem with all this is that somehow the three times what we are doing now has to be produced by somebody. Technically this has to happen and we presume that, given our agricultural research successes in the past, on my farm -- to take a typical example -- we get 135, 140 bushels to the acre of corn. Whoever is on that farm, and hopefully it will still be in the Lugar family fifty years from now, will be doing 400 bushels. Now that's quite a steep thing and when you put it in those terms for farmers, whether they are in Indiana or elsewhere, they sit up and take notice. How do you get to an average, and some years it might be 500 or others 300, but 400 bushels to the acre? We hope to think about that in our research component that we are working on in the committee now. It is a major part of our work but the other major factor, the factor that you are talking about today, is that all this has to move somewhere. In other words, theoretically even if on our acres we produce three times as much, we will not consume three times as much in the United States.

The figures you just had on the board here in a previous chart indicate that you think by the year 2000 there will be a 31 percent dependence in the agricultural economy on exports. You have defined that and defined prints for the record as agriculture exports divided by cash receipts minus government payments. But, almost a third of our ag. income is in the export situation. This requires a lot of success in 1999 and in other negotiations. It is not axiomatic that even as we become more efficient all of this produce will move. Now if it doesn't, there are going to be a lot of poorer farmers in the United States, discouraged by this. And a lot of agricultural research programs will not be nearly so well funded.

In essence, all of this depends, really, upon the efficiency of markets of the world and market signals in which other countries get the same signals and efficiently import from us those things that we do well, and correspondingly we from them. Now this was my speech to Dr. Fischler -- that he has as much of a stake in this as we do. That, in essence, the European market is a very large market and that the efficiency of agriculture there will be very important. I simply pointed out anecdotally to get his expression, that Chancellor Kohl, in conversations I have had with him, often points out that in due course there will be fewer farmers, that those that are there now will die and that age will take its toll -- there will be a different picture. But, Fischler does not see that occurring very fast and I think that there are many others that have not seen that occurring very fast either.

This is something that we are in together. Without the biotechnology changes that you two were pressing, and that I have tried in a modest way to press, we are not going to make it to those 400 bushels or whatever else we are doing. There is no other way to get there and if Europe is determined to stymie that situation now, we have an ecological catastrophe on our hands. We have had testimony around this table about all the trees in the world being chopped down, rain forests included, and people scampering for the last shred of whatever is left to eat on this earth.

This is serious business that won't occur next year, but if you are looking at fifty years you have got a very grim projection, without Dr. Fischler and everybody else involved in this thing. I think he understands that, obviously he has been in agriculture a long time. He understands his clients, all of whom are highly protectionist. He understands the terrible problems of paying for the European agricultural plan, which means they have not moved often to take on new members. They have frustrated the whole deal with NATO that might have moved along with the EU, but can not possibly given agriculture in Europe essentially stymieing development. So I think that each one of us in our way must make sure that Dr. Fischler gets the message that this is now serious with regard to biotech. That it is absolutely critical that we can not yield on that and that they will have to get over their funk.

Now he has got a lot of problems with constituents, many of whom have prejudices that are very deep, as Secretary Glickman has pointed out. This is not just Dr. Fischler. He is representing, as a live politician, people who are deeply worried about their food supply and what is occurring, but I think that this is a critical moment. I appreciate your taking this as an issue that really has to be pressed and has to be won. The immediate implications, as shown in the charts that you have given us, would be a reduction of 4 or 5 billion dollars of exports to Europe in a hurry. And if we were to get into retaliation, we would have a trade war of insuperable dimensions. And that really is sort of on our doorstep. Let me just ask if you had any impressions of optimism from your conversation with Dr. Fischler.