Opening Statement by Chairman Richard G. Lugar
United States Senator for Indiana

Risk Management Roundtable
Goal, Ground Rules, and Agenda for Moderator and Panelists
 April 28, 1999
 

Goal:  The participants will attempt to reach consensus on the general principles that will govern risk management legislation this year.

 
Ground Rules:  Following opening statements from Members, the Moderator will make a brief introductory statement, introduce panelists, and begin the Roundtable discussion by calling on panelists to discuss the first of a group of key issues.  Panelists are encouraged to be concise and brief in their remarks.  Individual statements by panelists will be limited to no more than five minutes through the use of a time clock.   The audience will be invited to submit written questions on each issue area to the panelists. A staff member from the Congressional Research Service knowledgeable about crop insurance and farm risk management issues will assist the Moderator.  Ample time will be left at the end of the day to summarize the Roundtable discussion.
 

Agenda: Morning Session

9:00   - 10:00 Opening statements by Chairman Lugar, Senator Harkin, and other Members.

10:00 - 10:10 Moderator’s introductory remarks.

10:10 - 11:05  Continue Federal Crop Insurance or Replace It With A Different Approach?
Can an insurance-based program where farmers pay at least some portion of an actuarially sound risk-based premium be a successful safety net program?  Would a permanent disaster program be preferable?  Or focusing the Federal agricultural support budget on programs other than insurance, and leaving provision of crop insurance to the private sector, or to States that wish to establish such programs tuned to the particular agricultural situations they face?  If we retain Federal crop insurance, should it be delivered by the private sector or through the federal government?

11:05 - 12:00   What Should Be the Private Sector’s Role in Farm Risk Management?  What is the role of forward contracts, exchange-traded futures and options, and other private sector instruments in helping farmers manage risk, and how can they work in conjunction with Federal crop insurance?

12:00 - 1:00  Lunch.

Agenda: Afternoon Session

1:00 - 2:00  Continue An Insurance-Based Federal Crop Insurance Program, But Make Major Changes –  Alternative One:  Continue individual farm insurance subsidies, but shift away from insuring specific crops and toward insuring whole farm revenue which would include specialty crops and livestock.   Alternative Two:   Shift from a USDA centrally managed insurance program to one that features private sector innovation based on exclusive marketing rights and open premium rate competition among insurers.

2:00 - 3:00  Continue An Insurance-Based Program, With Modest Changes – Expanding Coverage.   Currently, Federal crop insurance has high deductibles, little coverage for multiple year crop losses, and does not extend to livestock and many specialty crops.  Should coverage be expanded?  If so, how?

3:00 - 4:00  Continue An Insurance-Based Program, With Modest Changes – Equity Across Regions.  Some argue that the USDA Risk Management Agency’s approach to setting premium rates and Federal reinsurance provisions established in the Standard Reinsurance Agreement favor some “high risk” regions over other regions.  If so, is some special treatment for high risk regions justified?  Should regions be treated more equitably and, if so, how?

4:00 - 5:00   Discussion of areas of consensus and disagreement.