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Agriculture Secretary Says ‘Building Blocks’ in Place for Industry Rebound

January 20, 1986

RENO, Nev. (AP) _ An upbeat secretary of Agriculture told the nation’s wheat growers on Monday that the ″building blocks″ are in place for an economic rebound from the worst farm crisis since the Great Depression.

John Block, who has announced he will step down from the $86,200-a-year post next month, said 1986 will be another tough year for agriculture but added that steps were taken in 1985 to reverse the farm crisis.

″I believe we’re turning the corner; I believe we’ve bottomed out,″ Block said. ″We have laid the foundation for building a strong and viable industry, as well as strengthening what I think is the best way of life.″

Block praised the 1985 farm bill as a vehicle for making a ″gentle″ transition from a dependence on federal prices supports that he said helps consumers more than farmers by encouraging production and keeping prices down.

Even with lower price supports, Block said farmers shouldn’t expect significantly higher crop or land prices in the near future.

Block also said the Congressional overhaul of the Farm Credit System, a $70 billion system that provides loans for a third of the nation’s farmers, will help relieve the credit problem by stabilizing the system and guaranteeing farmers access to affordable credit.

He said passage of the Gramm-Rudman deficit reduction bill is another boost for agriculture, although he is expected to get some debate on that point from his audience of wheat growers gathered for their annual convention.

Gramm-Rudman will reduce the federal deficit and in turn lower the value of the dollar, making the nation’s agricultural output easier to sell overseas, said Block.

He added that it now appears the Department of Agriculture will have to trim its current budget by $1.6 billion this spring, and he predicted that 4.3 percent in cuts would be made across the board.

″American agriculture will be the great benefactor of the process,″ Block said.

But Jeff Shipp, director of government affairs for the National Association of Wheat Growers, said the group is increasingly worried about Gramm-Rudman cuts for fiscal 1987.

Unless Congress and the president can agree on cutting an estimated $65 billion next fall, those cuts will be made automatically.

Shipp said as it now stands, about $7 billion will have to come out of Agriculture’s budget, adding that level of reduction could create hardship for farmers dependent on various price support programs.

Under the farm bill, price supports are frozen for the next two years, then are gradually lowered in the remaining three years of the bill’s life.

Debate on Gramm-Rudman’s effects on agriculture, as well as the impact of the farm bill and the nation’s trade policies, is expected to dominate the wheat growers’s convention that ends Wednesday.

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