January 14, 2013

Nashville, TN

SEC VILSACK: Thank you. Bob, thanks very much. It's always a pleasure to have the Farm Bureau President announce that you're going to -- that you've got a job for the next couple of years. And I was talking to Bob before this and suggested that I remember a year ago we were in Hawaii. It was beautiful weather. Of course, it didn't rain from that point on for the rest of the year.

So here we are in Nashville. It's a little cloudy, a rainy. Hopefully that's good news. We certainly need -- we certainly need the rain. And I want to thank Bob Stallman for his leadership. He has been a good friend, he's been a good advisor, and he's someone that I certainly have on over the course of the last four years and hope to be able to continue that relationship.

I also want to acknowledge the good work of Mark Maslyn and Mary Kay Thatcher. They too have been very helpful with the USDA staff in arranging for opportunities like this to speak to you and also supporting American agriculture. I'd be remiss if I didn't have a shout out to my own Iowa Farm Bureau delegation led by Craig Hall who is here today. I'm certainly a proud member of the Iowa Farm Bureau. I've got my card in my wallet. And I'm sure my dues statement is coming next month.

(Applause.)

SEC VILSACK: Well, I don't know about you folks, but I was glad to see 2012 come and go. It was a tough year for all of us. There were a number of events that really compelled us to take a look inward. And many of those events that occurred in 2012 have transcended and -- and are going to impact and affect the work that we do in 2013.

Of course it starts with the drought. Just last week, I announced that 597 counties across the United States in 14 different states would be already declared disaster areas because they had been on the drought monitor for more than eight consecutive weeks. That means that those counties will have available to them the disaster assistance from USDA, as well as the SBA.

But perhaps more importantly, it's a wake-up call for the rest of the country whose focus may have moved away from the drought of 2012. We want to make sure that people understand and appreciate that this may very well continue and it does have ramifications.

We're keeping an eye, for example, on the navigation of the Mississippi River, recognizing that a lot of what we grow and what we produce and what we sell overseas needs access through the Mississippi to the ports down in New Orleans. Certainly helpful and worked with the Corps of Engineers to ensure during this very difficult and important time that navigation remains open along the Mississippi.

We appreciate the Corps moving ahead with removing of rocks that would have interfered with the navigation, and received a very good and positive briefing last week from the Corps. Fingers crossed and knock on wood, things look at least pretty good in the short-term for keeping that important navigable river open.

We've also been working with the Drought Task Force. We want to make sure that the federal government and my sister agencies are not losing sight of the important role that they can play in helping to address and deal with the long-term impacts and effects of the drought.

We're looking forward to working in Colorado and Kansas on a pilot project on water storage. We've just signed a Memorandum of Understanding with the Department of Commerce and NOAA to improve our forecasting. We understand and appreciate it's important for folks to have accurate information about weather patterns. And to the extent we can improve our forecasting we're committed to that.

And we are certainly well aware of the need to continue to research on making sure that we understand fully and completely what happens as climate changes, what the impact will be in the long-term. I'm proud to say that within the last four years we've doubled research efforts in the area of climate impact. And over the course of the next several months, we'll be talking a little bit more about what we will be doing at USDA to ensure that we equip our farmers, ranchers, and producers with the best information, the best practices to deal with what everyone must acknowledge is indeed a very challenging set of climate circumstances.

Two things I take away, however, from the drought of 2012 as it extends into 2013, and that is the extraordinary resilience of our producers. I think it's amazing that despite the worst drought we've had since the 1930s, we still had one of the top ten corn crops in the history of the country. It speaks to the willingness of our producers and American producers to embrace technology and techniques that make them the most productive and most efficient in the world.

Another takeaway is the important role that safety nets play in helping farmers and producers through difficult times. Thank heavens we had a strong crop insurance program that provided help and assistance. The unfortunate circumstance is that we didn't have a similar vehicle to assist our livestock and dairy producers who have been through a very, very difficult time.

We potentially could have had such a help if we'd been able to get a food, farm, and jobs bill through the Congress. Now, in polite company, I can say I was disappointed. I've used different words to discuss my – my feelings about the lack of a farm bill in smaller settings.

I think we were all disappointed. We all recognized that there was an opportunity for true reform. We recognized that this was a chance for us to reform the system in a way that was defensible and understandable to the wide variety of people living in this country and that we didn't risk what we now face, which is the possibility that we will be dealing with a baseline that was different and less than what we would have had in 2012.

We were disappointed in the fact that there was, in fact, no disaster assistance either in the form of a food, farm, and jobs bill passed through Congress or in the extension that was ultimately approved. No help for livestock producers; no help for dairy producers.

We were disappointed that you all were not given the certainty of what a five-year program would do, and the confusion that we now are confronting. Well, what are the programs? Will they survive? What do we do about ACRE for example?

Well, let me be clear about ACRE so that we at least can leave here with one specific recommendation and one understanding. We're going to do what we have to do and what Congress has directed us to do with the extension. But we recognize that people may have made a choice several years ago with reference to ACRE and they would like the opportunity to re-think that choice. So we will provide an opportunity for people to opt in or opt out if they became disenchanted with the ACRE program. This will give people flexibility, and it'll give them the opportunity to re-evaluate.

Having said that, I think it is fair to say that with sequester and some of the other budget challenges, there's no absolute guarantee what the programs are likely to be. But you can be – you can be assured that we at USDA we'll do everything we possibly can to provide you the most flexibility, the most up-to-date information, and -- and we will certainly continue to articulate for the need for Congress to pass a five-year bill.

I think we were also disappointed that the momentum that has been building in the rural economy with expansion of local and regional food systems and expanded export opportunities and specialty crop production and the bio-based economy, that we weren't able to provide the resources and the commitment in a five-year bill to continue that momentum. And we were also acutely aware that neither the extension, nor the failure to pass a farm bill resolves the issue with reference to Brazil and cotton, which could potentially threaten significant retaliation against not just American agriculture but other products.

We are committed, and I know the Farm Bureau is committed, to making sure that 2013 is not a repeat of 2012. We need a five-year bill and we need it now.

(Applause.)

SEC VILSACK: That five-year bill must start with the commitment that we all agree is necessary, which is that we have a strong safety net built on a strong and viable crop insurance program, a safety net that is defensible and understandable, and one that provides the help and assistance not just to crop producers but also livestock and dairy producers.

Sometimes it's difficult, frankly, to defend to our urban and suburban friends the Direct Payment system. That's why it's going to be important to work with Congress to reform that system but still provide a strong and viable safety net.

This new five-year bill must continue our commitment to provide credit, and particularly to those beginning farmers and ranchers. We need to adjust and amend our credit programs to reflect the reality of higher land values and higher costs. We need strong but streamlined conservation programs.

We don't need as many conservation programs, but we surely need within those conservation programs enough flexibility to be able to tailor it to a specific watershed or a specific operation.

A five-year bill must continue our commitment to trade. It must empower us to work to build a strong export opportunity and to reduce the sanitary and bio-sanitary barriers that often are created as impediments to American exports. I'm proud to say that in the last four years we've had the strongest four years of agriculture exports in the history of the country. And I'm also proud to say that we're projecting record export opportunities this year as well.

And I'm hopeful that we'll have several announcements here in the very near future as it relates to some markets that have been closed for a while opening up. But we must solve some of the vexing problems associated with Brazil and cotton if we are to ensure that there will not be appropriate retaliation against the United States.

This five-year bill must also express strong support for research. The extraordinary story of American agriculture is directly linked and related to the capacity of America to invest in agriculture production. Agriculture is the second most productive aspect of our economy since 1980. Think about that. How many people outside of this hall understand or know that? You-all know it because you've dealt with it. You deal with it every single day: Embracing new technologies, new techniques, new machinery. And as a result, you become the most productive and most efficient farmers in the world.

But sometimes that lesson has been lost on the rest of America. It's going to be important for us to continue that story of innovation. But to do it, we need a commitment to research. It means additional dollars and it means structures and systems that will allow us to more effectively leverage those research dollars.

A five-year bill should also effect -- and continue to support and appreciate our specialty crop producers. Now, these specialty crop producers are providing new opportunities for entrepreneurship in rural America, those local and regional food systems that are dotting the landscape that compliment production agricultural. We have set as a goal this year at USDA to help finance and support 100 new market opportunities in the local and regional food system in addition to continuing to set record setting export opportunities. We want to expand market opportunities both here and abroad.

And a new five-year bill must embrace not just renewable fuel, but the whole potential, the unlimited potential of the bio-based economy. Just a couple of days ago I was in the state of Pennsylvania at their farm show. And after the farm show, I had a chance to go to a company that is essentially taking water and heat and converting agricultural waste into the sugars necessary to produce a wide variety of fuels and energy products.

I've seen the ability to use corncobs and switch grass and algae and a wide variety of things that are grown and raised or could be produced in rural areas, converted into plastics, into chemicals, into fabrics, into fibers, into fuel, into energy. It is an unlimited future. But we require support and assistance and help and a commitment through a five-year bill.

And a five-year bill, in addition to expressing support, must allow us the resources to meet the goal that we've set this year of creating and investing in 50 new bio-based companies in the United States. There are 3,100 companies today that are taking agricultural waste products, agricultural residues and turning them into new products. We want to expand that number each and every year.

And finally, a five-year bill must also reflect the proper context for our nutrition assistance programs. Folks, these programs are not necessarily the problem. They are part of an important safety net for struggling families. They're also an important safety net for producers. After all, producers get somewhere between 15 cents and 16 cents of every food dollar that's spent in a grocery store and a restaurant. And to the extent that families are empowered during struggling times to be able to buy adequate groceries for their family, at the end of the day that also helps American producers.

Make no mistake about this; it's not a situation where if we take money from the nutrition programs that somehow magically that's going to find its way into some other program that we may have greater need for. The reality is in this time and at this age we have got to understand and appreciate the importance of keeping these programs together. The reason being, that we're going to need all of the support we can muster to get a five-year bill through.

Now, you have to ask yourself, given the relevance of rural America, the fact that it is the supplier of most of the food that we consume in this country that allows us to be the strongest nation on Earth because we are a food secure nation, it is rural America and the conservation programs and efforts by American producers that help to guarantee a substantial amount of the water that we consume in cities, in suburbs, and around the country.

It is rural America that if you think about it is providing the feed stock for most of the energy and most of the fuel that's consumed and used in homes and businesses across this great land. It is rural America that's responsible for millions of jobs. One of out of every 12 jobs are directly tied to agriculture alone. And it's rural America, as I often say, that provides a disproportionate number of the defenders of our liberty and our freedom, 16 percent of America's population providing 40 percent of the military.

The question, given all of that contribution and more from rural America, why is it so difficult for us to get a five-year bill through the Congress? What has happened? Why is this the first time in recent memory that bill passed through the Senate, through the agricultural committee, and yet was stymied and didn't get done. Whether we like it or not, I think we have to address and have to acknowledge that the political clout that rural America once had, it doesn't have as much today. And it's going to be important and necessary for us to have conversation about how we rebuild that political capacity, and I believe we can.

Let me give you a few suggestions. First of all, it starts with an understanding and appreciating the real problem we face in rural America, which is in the last census, 1130 rural counties in America, over 50 percent of the rural counties in America lost population. 16 percent of America's population in rural America is the lowest percentage in our history. It's pretty simple. Fewer people, ultimately reflects itself in fewer people in Congress, in state legislatures who understand and appreciate the challenges and the opportunities in rural America. That means that we have got to begin to look at ways in which we can expand our influence.

One way we could do that is for the American Farm Bureau and other key agricultural groups to look for opportunities to convey the agricultural message in a non-conventional way. Let me give you an example.

Now, I could probably take a poll of all of the people here about your attitudes about Chuck Hagel as Secretary of the Defense. There may be some of you who want him and some of you who may not. There may be some who have concerns about his position on Israel or on Iran. But let me tell you why I want Chuck Hagel – because he's from Nebraska.

And being from Nebraska, he understand and appreciates the role of the bio-based economy, and he would be a Secretary of Defense that I think would probably be quite supportive of the notion that our military should be more dependent on domestically-produced fuel and energy than on imported energy. He could be a Secretary of Defense who could champion our commitment to the bio-based economy. And so the American Farm Bureau and farmers and ranchers in this country have a stake in who the Secretary of Defense might be, and we ought to express that. We ought to let folks know we're interested in that nominee's position on biofuels and the bio-based economy.

Well, what about the Treasury Secretary? Why should we be at the American Farm Bureau Convention interested in the Treasury Secretary aside from the role he plays, or she plays, in providing the economy and the economic strength of the country and protecting it. It's because that department has a new market tax credit program that provides hundreds of millions of dollars in tax credits to support economic opportunity. And it's necessary that we look at ways in which those programs at the treasurer department can be used to invest in rural opportunities. So it matters to America who that Treasury Secretary is, and we ought to have something to say about that. We ought to be questioning the nominee about his views of the new market tax credits and the ability to grow rural America.*

In addition to building and reaching out to key -- in key spots like the Treasury Secretary, and the Secretary of Defense, and the EPA Administrator and the Commerce Secretary, we need to focus on building strategic alliances in rural America, and not just within agriculture.

I applaud the Iowa -- I mean the American Farm Bureau and Bob Stallman and all of those who had the foresight and the vision to create the Farmer and Rancher Alliance, an opportunity for agriculture to come together and speak with a unified and single voice. That's important.

But we've got to extend beyond just talking to ourselves. We've got to embrace diversity. And there is a tremendous opportunity to extend our alliances strategically with the issue of immigration. Agriculture has a stake in the immigration debate. Agriculture wants and needs immigration reform. Agriculture must have a steady and stable supply of labor. And agriculture relies on immigrant labor for that steady supply.

This is a wonderful opportunity for us in rural America to embrace diversity, to embrace an immigration policy that makes sense, to embrace comprehensive immigration reform, to embrace the solving of this problem that has vexed us for so long, the creation of a stronger immigration system in this country. And in doing so, reaching out to the Evangelical faith-based community, in reaching out to Hispanic-serving organizations and creating friendships and alliances and an understanding of what goes on in rural America and the important role that rural America plays in the lives of all Americans and all those who wish to be Americans.

Building strategic alliances, extending the reach of key farm groups, constructive engagement, it will be necessary for us to continue what we started the last several years of constructively engaging those where we may have questions or difficulties. I take it as a positive sign that we were able to talk to and visit with Lisa Jackson as the EPA Administrator. That she was willing to visit farms and ranches; that she was willing to have frequent visits with farm leaders. That's constructive engagement. And I think it made a difference in terms of the attitude that the administrators had about issues involving and affecting rural America. That constructive engagement must continue with the new administrator, and I pledge to you that I will do everything I can to make sure that happens.

The nutrition community. Rather than raising issues about SNAP, we should be figuring out ways in which we can connect to those who are advocating for nutrition. It expands significantly our reach. It develops an alliance and a friendship and a relationship that brings common cause to the passage of a five-year bill.

And, frankly, those who are engaged in constructive engagement, they shouldn't be faulted for doing so. Now, I know that there are not too many fans of the Humane Society in this room, but egg producers thought it was in their best interest to avoid 50 different referendums, 50 different sets of rules, so they sat down with folks and they reached common ground. After all, isn't that what we're asking our Congress to do?

Isn't that what we're asking our political leaders to do, to sit down and make common cause? I think the egg producers have the right idea. Now, the issues may be different for different types of producers, but we need to be constructively engaged at all times in conversations. We may not find agreements, but I think we will substantially reduce those who oppose farming and substantially reduce the reach of those, and hopefully be able to get enough proactive activity that results in a five-year bill.

And I think we need a proactive message. You know, I've been in a lot of groups and I've met with a lot of farmers. And I have actually done this as a governor, as a state senator, as a mayor, and as a lawyer. And I'll certainly do it as the Secretary of Agriculture. And I understand how difficult this is. I understand how frustrating it can be, to be the best in the world at what you do and not have folks appreciate it.

But I also know that we've got to make a case to the young people of this country that there is unlimited opportunity in rural America. That it is the place to be, it's the place to do, it's the place to make a difference. If I were talking to a young person today, I would say – are you interested in accepting the moral challenge of our time? Are you interested in figuring out how not just to feed us in America, but to feed the world? Are you interested in eradicating hunger? Well, then you can help do that in rural America.

If I were speaking to a young person, I'd talk about the fact that for far too many years in this country we've not had the upward mobility in our economy that's allowed people to work hard and play by the rules and rise up. Folks feel stuck. They feel frustrated. They feel angry. Well, the ability to re-introduce upward mobility in our economy can be found in rural America.

You see, we're rebalancing our economy. We're getting away from solely relying primarily on consumption and getting back in the business of making, creating, and innovating, producing. Well, who does producing better than the folks in rural America? There's unlimited opportunity to make, create, and innovate in this bio-based economy in rural America.

If I were talking to a young person, I would say, you're concerned about our overreliance on foreign oil, you can solve that problem in rural America. If I were talking to a young person who was concerned about the changing climate and the effects and impacts it will have on all of humanity, I will say to him or her the solution to that is likely to be in rural America.

We can inspire young people. We can encourage young people. We can create opportunities for young people, not just on the farm but in small towns all around this country. We can bring people back. We can keep people. And in doing so, we can create a message and a powerful message of the importance that rural America plays in the lives of every single American.

And then it becomes a little easier to explain to members of Congress from urban and suburban areas why a five-year bill is necessary. And it becomes impossible for political leadership to stop its passage, because too many people want it, too many people need it, and everybody understands the importance of it.

That's what this is about: Expanding the reach of key rural groups, building strategic alliances, constructively engaging even with those we disagree with, and a proactive message, enthusiastically, enthusiastically communicated to young people. They're ready for this. The country's ready for this.

Now I know I'm speaking to a group and you may be saying, Well, that's great, Mr. Secretary, but are you doing all this? Are you reaching out to key groups? Are you building alliances? Are you constructively engaged with people that don't necessarily agree with you? Are you providing a proactive message?

Well, let me tell you what I did. I was at dinner one night and I saw Tom Donohue, the President of the U.S. Chamber of Commerce. Tom's a fellow who's got white hair. He's a striking guy. I went up to him and I said, you know, Tom, the Chamber of Commerce isn't doing enough to talk about agriculture, isn't doing enough to educate people about the extraordinary innovation that's taking place in rural America. It's ignoring rural America.

You know, a Democrat talking to the U.S. Chamber of Commerce President, not an easy thing to, do, especially at the time when they were spending hundreds of millions of dollars to defeat my boss. Hard to do, but the right thing to do. And to Tom Donahue's credit, he said, you know, Mr. Secretary, you've got a point, so here's what we're going to do, we're going to put you in touch with Margaret Spellings, former Secretary of Education under the Bush administration, and you and Margaret through our foundation can work on a program, and we'll have that program after the election, and we'll focus on innovation and we'll focus on agriculture.

This is the most amazing things, folks. They came over to the USDA. I don't know the last time somebody from the U.S. Chamber of Commerce was over in a Democratic administration at the USDA. I bet you it's been awhile. They came over and they said, well, what's going on in Agriculture?

And we told them all the amazing things that you're doing: The extraordinary productivity, the extraordinary productivity, and the innovation of taking waste product, of taking hog manure and using it to build asphalt roads, and the ability to take corncobs and make plastic bottles for Coca-Cola, and the ability to take algae and produce fuel and all of these amazing discoveries happening in rural America. They were blown away. They had standing room only for this, for this half day symposium. They had people stay through the entire morning session, which they said was unusual.

And they had a wonderful speech from Greg Page at the end of the day in which he talked about the tyranny of "or" and the power of "and". Greg pointed out that when we get this "or" business – my way or your way, as opposed to my way and your way -- it stifles innovation. It stifles agreement. It stifles consensus in that we've become too much of an "or" country.

It was a remarkable day. And at the end of it, the Chamber said, you know, we've learned so much about what you-all are doing. Could you help us on some additional topics like water? I said, well, we're very interested in water at the USDA. We'll be happy to work with you.

Folks, that's what's happening when we take a chance, take a risk. So I want to show you how we introduced you to the Chamber of Commerce. I want to show you just a short video, and then I'll conclude with a last comment and you can get to the rest of your program. So with that, I don't know how this works but -- I just -- Bob says just say "video".

(Video shown.)

SEC VILSACK: You know, folks, America. And I get frustrated, just as when you see things like this, when you go into the Forest Products Lab and they talk to you about nano-technology and the capacity to take wood fibers and break it down and create a product that's stronger than Kevlar, and you know that if somebody can fun a split second faster in a – in law enforcement or in the military, that the split second may mean the difference between life and death; when you see cures for cancers; when you see ways in which you impact the climate positively, those are all job opportunities that by the nature of what we're talking about have to take place in rural America.

That's why I am extraordinarily privileged and honored to have the job as the United States Secretary of Agriculture and to have another opportunity to continue this work. I don't know that there's not a more important place, a more significant place in the future of this country than rural America.

And I get frustrated, just as you do, that I doesn't get its due. But I've got a feeling the we're beginning to turn the corner. I've got a feeling that 2013 is going to be the year where people begin to pay a lot of attention to what takes place in Rural America. And I've got a feeling that eventually the greatest producers, the greatest farmers in the work are going to get their due. It's long overdue

So let me- - let me finish by thanking you for what you do: For feeding my family, for creating jobs, for teaching us about stewardship, for defending our country. That's what rural America's all about. That's what the Farm Bureau's all about. And by God, we're going to make sure everybody in the country understands it.

Thank you. And God bless you

(Applause.)

*This sentence has been edited from the following original sentence: "We ought to be questioning Senator Kerry about his views of the new market tax credits and the ability to grow rural America."