THE WHITE HOUSE

                        Office of the Press Secretary
                           (Little Rock, Arkansas)
______________________________________________________________
For Immediate Release                                     July 18, 1998     

                              PRESS BRIEFING BY 
                    SECRETARY OF AGRICULTURE DAN GLICKMAN
                    AND ADMINISTRATOR OF AID BRIAN ATWOOD
		
		
                               Washington, D.C.	     			       
      


8:05 A.M. CDT
		
		
		MS. WEISS TOBE:  Good morning.  The President in his radio 
address this morning will make several important announcements about problems 
facing problems in many parts of this county.  Secretary of Agriculture Dan 
Glickman and Brian Atwood, Administrator for the Agency for International 
Development, are here to brief you on these announcements and answer any 
question you may have.  
		
		As you know, the radio address is embargoed until 10:06 a.m. 
and it will be piped into the briefing room. 
		
		SECRETARY GLICKMAN:  Good morning, everybody.  Following my 
few remarks I'm going to ask Brian Atwood, the Administrator of AID, to make 
some remarks.  And we also have with us today Chris Goldthwait, who is the 
General Manager of the Commodity Credit Corporation, and Under Secretary of 
Agriculture Gus Schumacher, as well.
		
		Let me just say that the President is actively engaged in the 
whole farm crisis issue and is taking executive action to strengthen the 
crisis afflicting certain parts of the farm economy.  And he understands that 
while the general economy is good, and, in fact, it's the strongest in over 30 
years, there are portions of the economy, particularly the farm economy, that 
are troubled right now.  And in that context, when the President signed the 
1996 Farm Bill he specifically stated that it did not provide an adequate 
safety net, particularly when times were bad and when prices began to decline.  
And this administration continues to advocate a comprehensive approach to 
helping farmers through this crisis.  And this initiative that we're talking 
today is one part of that plan to try to help the farm situation.  	       

		The President's new program which he will be announcing today 
is a bold initiative to respond directly to one of the primary weaknesses in 
the farm economy, which is large surpluses, price depressing surpluses, which 
largely are as the result of weaker exports and an international economy which 
is not as strong as we would like.
		
		Starting next week, USDA will begin buying wheat that then 
will be used for foreign food donations, opening new export channels for 
American farmers.  This will be done under the authority that I have under the 
CCC, or the Commodity Credit Corporation, Charter Act, and it will not require 
any additional appropriations nor congressional action.  
		
		We estimate, combined with USDA as well as AID, that about 2.5 
million tons of wheat, a little more than 82.5 million bushels of wheat are 
worth approximately $250 million will be 

used.  However, USDA figures on the current wheat surplus, when 
measured as the stocks-to-use ratio for this year compared to the 
last 10 years -- that tells you how much wheat we actually have 
compared to what we will use -- suggests that substantially more 
than 2.5 million tons might eventually be used.  But the first 
tranche, the first goal, is 2.5 million tons.  If other 

commodities begin to show similar surpluses, the program will be 
used for those surpluses as well.

	     The price effects on this action may vary, but our 
analysis of historic trends suggest moving about 2.5 million 
tons, or 82.5 million bushels, of wheat from the market would 
boost the price of wheat somewhere between 10 and 13 cents a 
bushel and would probably have some impact on the price of corn 
as well.
	     
	     We intend to stage the purchases strategically to 
sustain and to maximize the price effect, and we intend to begin 
this process immediately, next week.  The first five recipient 
countries -- and Brian Atwood will talk about that -- will 
include Ethiopia, Eritrea, Indonesia, North Korea, and Sudan -- 
countries that currently cannot make commercial purchases from 
the U.S.  And I want to repeat, these purchases are being made 
for those countries that cannot purchase wheat commercially from 
the United States.  As further assessments are included, other 
countries may also be included.
	     
	     Today's announcement is a first step, but the 
President strongly believes that we must do more to deal with 
this farm safety net.  As you know, the President has strongly 
endorsed the language offered by Senator Conrad in the Senate 
which would add approximately $5 million for disaster related 
emergency spending, building on crop insurance and other programs 
that we have.  And I'm pleased to note that the Speaker yesterday 
indicated positive words for this particular announcement.  We 
are also looking at other things in terms of crop insurance, in 
terms of our own programs to deal with a variety of problems.
	     
	     I also point out that last year we recommended that 
deficiency payments, or actually market transition payments, that 
farmers would get be advanced, and we also recommended that on 
April 4 of this year that they be advanced.  We're pleased that 
the Speaker has announced that he would move legislation to 
advance those payments.  I would point out that is no new money, 
however.  That is money that was going to be paid out anyway in 
December and January of this year, and what the Speaker has 
proposed, which we support, is that farmers will be given the 
option of moving that up about 45 days, until after the end of 
September, so into this next fiscal year anyway.  And that may be 
helpful for some farmers at their option.  But that is not a 
fundamental answer to the problem of getting price up and dealing 
with the disasters that farmers have to face today.
	     
	     So we welcome those steps, the steps that we're 
talking about today.  We'll begin to have much more profound 
effect on the farm economy and we'll also bridge the gap where 
the surpluses can go to help hungry people, needy people around 
the world as well.
	     
	     So I would like to call on my colleague, Brian 
Atwood, the Administrator of AID, for his comments in this 
regard.

	     MR. ATWOOD:  Thank you, Mr. Secretary.  
	     
	     Let me just say that for those of us in the 
humanitarian relief and emergency food business, this has been 
one of the worst years on record.  We've had the El Nino drought; 
we've had a larger number of conflicts than usual; we've had the 
Asian financial crisis that has caused, in the case of Indonesia, 
the economy to virtually collapse.  And as we reach the end of 
the fiscal year here, most of our Title II resources that we use 
for emergency food have been depleted.

	     So we have a confluence of factors here that I think 
are very favorable from our part of view in order to respond to 
the world's needy.  We have here a food surplus that is driving 

food commodity prices down, and overseas, we have serious 
starvation and famine and a real need for the food that the 
American farmers can produce.
	     
	     Let me just give you some examples.  In his radio 
address, the President will refer to Indonesia and Sudan in 
particular.  In Indonesia, we have a country of about 200 million 
people; by the end of this year we will see approximately 95 
million people fall into extreme poverty.  That means they'll be 
making less than a dollar a day, they will be unemployed, they 
will not be able to purchase food.
	     
	     Indonesia has a requirement for food purchases 
outside its own country of 4 million metric tons, so they're not 
able to purchase that food, and so they have a very dire need for 
the kind of food that the Secretary has been discussing.
	     
	     In Sudan, we have 1.2 million people that are 
currently at serious risk of dying.  We have -- you've already 
seen television photographs of people dying in the Bahr al 
Ghazala area of Sudan right now.  We have a serious problem of 
getting food to them.  We, however, now, have coincidence of a 
cease-fire that has been called by both sides in the war in 
Sudan.  So we have an opportunity now to get food into that 
region and the rest of Sudan.  There are nine other countries, 
mostly in Africa, that have very serious shortages of food, and 
this food and, perhaps even more that might be forthcoming later, 
will be of real use to the people that are suffering from famine 
and the like.

	     So this is, again, a very good confluence of 
interest here.  We can both help the American farmer and in the 
tradition of the United States, provide humanitarian relief to 
the needy and the developing world.  Thank you.

	     SECRETARY GLICKMAN:  Open up for any questions that 
anybody has.

	     Q	  Mr. Secretary, under what program, CCC program, 
will this all fall under?
	     
	     MR. SECRETARY:  Well, it operates under the CCC 
Charter Act, which was enacted in 1948, and it gives the CCC 
broad authority to engage in the buying and selling and 
transporting of farm commodities and products relating to farm 
commodities and related facilities.  It's very broad authority. 
And we have very great flexible authority in order to operate 
under that act.  And over the years it has been used to carry out 
a number of programs.  In fact, the Export Enhancement Program 
and the Payment In Kind program were first authorized under the 
CCC Charter Act, and they were then separately authorized and 
appropriated as individual type programs.  But we believe that 
the authorities are clearly there.

	     And what has happened to make this more realistic 
now is that in 1986 and 1987, the surpluses and the stocks-to-use 
ratios were in much different circumstances than they are right 
now.  That is, in '86 and in '87, we were talking about very 
small stocks-to-use ratios and very low carry-overs.  But we have 
had a combination of extensive production both at home and around 
the world -- dramatic enhancement of production.  And then 
coupled with this continuing extraordinary hunger that continues 
to exist.

	     And one of the things that people constantly ask me 
about, both in farm country and other areas, is why can't you get 
this grain, these surpluses, to those hungry people.  This is 
largely the statute to do it, and we do have a confluence now of 
large surpluses and the wherewithal to get it to hungry people.  
And working cooperatively with AID and the other agencies of 
government, the President just says, marry these two things; get 

this done as quickly as possible.  It will help farm programs, it 
will help farm prices to some extent; but it will also, perhaps, 
resolve some international social problems.
	     
	     Q	  I notice the President does not mention seeking 
authority from Congress for fast track this year, and he talks 
about IMF and so on.  But can you explain why he's going to 
submit it?
	     
	     SECRETARY GLICKMAN:  The President strongly supports 
fast track, but the most pressing problem right now, short-term, 
is IMF funding assistance, because that will make the difference 
in the very short-term in terms of commodity sales overseas.  
	     
	     We want fast track authority to enter into trade 
agreements.  I worked very hard on this in this room to try to 
get the votes before.  And we obviously continue to want that.  
But from a priority perspective, from a more emergency 
perspective, the IMF assistance is number one on the list.  And 
we just provided some assistance to Russia, as you know, out of 
the reserve fund.  Not much money is left in that fund to deal 
with problems dealing with international and country-wide 
economic and currency problems.
	     
	     So IMF is number one in terms of its significance to 
American farmers and American businesspeople in the very 
short-term.  And I think the President recognizes that there are 
a certain number of things that Congress can probably end up 
doing this year before adjournment.  And he has not backed away 
from his commitment from fast track, but he is, I think, more 
concerned about the emergency nature of getting IMF assistance 
finished right away.

	     Q	  How will you determine which farmers you'll buy 
the wheat from? 

	     SECRETARY GLICKMAN:  Chris Goldthwait is our CCC 
General Manager, he'll probably tell you a little more about the 
logistics.

	     MR. GOLDTHWAIT:  Many, many of our food aid programs 
rely on open public tenders that are held by the Farm Service 
Agency out of their Kansas City office, so -- 

	     SECRETARY GLICKMAN:  That's part of USDA's 
operation. 

	     MR. GOLDTHWAIT:  So they will simply issue a tender, 
and they will specify the qualities of wheat that they are 
seeking.  And those that own the wheat will bid to fill the 
tender.

	     Q	  Is it your expectation what type of wheat 
that's going to be?  Do you have any idea? 

	     MR. GOLDTHWAIT:  I suspect that it will be a variety 
of classes of wheat, depending on the needs of the needy 
countries that are targeted.  There will be some soft wheat, 
undoubtedly, involved, but there could also be hard wheats.

	     Q	  Will it be big farmers or small farms where it 
will come from? 

	     MR. GOLDTHWAIT:  The wheat will not be purchased 
directly from farmers, but be purchased from the grain elevators 
and the companies that are the conduits to the farmers. 

	     Q	  Do you have a date set yet for the first 
tender? 

	     MR. GOLDTHWAIT:  We don't have a date for the first 

tender, but we think the tendering could begin within a week to 
10 days' time.

	     Q	  And then how long would it take?  How long to 
move out this 2.5 million tons? 

	     MR. GOLDTHWAIT:  The initial shipments could come as 
soon as 60 days from now.  They will continue for some time, but 
might be completed in three to four months. 

	     SECRETARY GLICKMAN:  We want to move this as quickly 
as possible. 

	     Q	  Mr. Atwood said that there was a need in the 
country of Indonesia alone for 4 million tons of grain per year, 
but you've said you've just announced a program that's going to 
release 2.5 million tons to five countries.  Couldn't you make 
the argument that this is just a minuscule effort to help the 
farmers and a minuscule effort to help needy countries? 

	     SECRETARY GLICKMAN:  Well, I'll let Mr. Atwood talk 
more about Indonesia, but first start by talking about that 2.5 
million tons is a lot of grain logistically to move in 
humanitarian circles around the world.  You have port facilities, 
You have shipping, You have countries that often don't have 
infrastructure to deal with it.  As I said, I'd like to increase 
this amount if we can, but this is the first tranche.

	     The second thing is that we have said that we're not 
going to interfere with normal, viable, commercial sales.  So 
some of these countries may be in a position to purchase part of 
their needs commercially.  And we have several programs in the 
U.S. using normal credit type of operations to do that.  
Remember, this is just humanitarian assistance.  But again, if we 
find the need continues to be as great as we think it is, and we 
have the surpluses available of either wheat or other 
commodities, we will use them. 

	     MR. ATWOOD:  Exactly the point, that in a normal 
year, when Indonesia's economy is functioning appropriately, with 
-- they've been experiencing a lot of growth in recent years, 
they purchase about 4 million metric tons outside.  They're going 
to have a serious shortfall.  They won't be able to purchase 
that.

	     And as I mentioned before, 95 million people living 
in extreme poverty will not be able to buy that commercial wheat 
or farm products of various types -- rice is another major 
commodity there.  So we're talking about their inability to 
purchase that amount of food.  And we've got to figure out what 
that shortfall is and help them, along with other countries, 
obviously. 

	     Q	  Given the fact that the North Korea food 
shortage is still very acute, is it likely that North Korea will 
get a sizable donation from this program? 

	     MR. ATWOOD:  We really have not made a determination 
on that yet.  As I mentioned before, there are nine countries 
that are on the list for consideration to receive wheat from this 
2.5 million metric tons.  And we're looking very seriously at 
North Korea and a number of countries.
	     
	     Q	  Are there more than those countries --
	     
	     MR. ATWOOD:  Yes, they are.  
	     
	     Q	  Just as a follow up to that, can you explain a 
little bit about the criteria in which you used to select those 
countries and whether or not there was any concern about North 
Korea's nuclear proliferation policy -- if any of the politics of 

that particular country came into play or if that did not?
	     
	     MR. ATWOOD:  It did not.  We looked very, very 
seriously at the humanitarian crisis in these countries.  
Obviously, we have a lot of interest in all of these countries, 
and North Korea is not a country with which we have very close 
international relations.
	     
	     But, nonetheless, we looked at the humanitarian 
need.  We look at the degree of starvation in these countries.  
In the case of North Korea, we've responded mainly because their 
agricultural system has virtually collapsed.  They are, however, 
on the verge of a new harvest, and so we have to really analyze 
what the need will be.  So we haven't made a determination yet 
with respect to North Korea. 
	     
	     Q	  Mr. Secretary, you've been around the country 
more than some of us in Washington and you're going next week to 
Carolina to look at the situation.  How bad is it out there?  We 
heard about the different areas, but how bad is it really?

	     SECRETARY GLICKMAN:  Some parts are very bad.  
Obviously, the Dakotas gets the most attention because of the 
extreme nature of the variety of crop disaster problems, from 
cold to wet, to test to drought.  And that's also in western 
Minnesota.  But we're seeing some of the most extraordinary 
hot-dry conditions in a generation in west Texas and in the 
Southwest.  And then I'm going d own to the Southeast to take a 
look at the conditions in South Carolina.  But I've talked with 
Commissioner Irvine of Georgia, and I was in Florida myself 
outside of Daytona Beach.

	     On the other hand, there are parts of this country 
that the weather is exceptionally good.  My own state of Kansas, 
by and large, has had very good weather, had some of the highest 
wheat yields in history.  So far, except for perhaps too much 
rain, the Central Midwest has been pretty good.  But as often 
happens, disaster is rather ad hoc, and it has hit people in 
rather unusual and extreme ways.  And as opposed to previous 
years -- this is important to recognize -- up until 1994, 
Congress would generally respond to crop disasters annually 
through what was called Ad Hoc Disaster Assistance.  A lot of 
people began to rely on those ad hoc payments as a disaster would 
come up.

	     In the mid-'90s, we replaced that program -- '94 -- 
with a crop insurance, an all-risk crop insurance program that, 
quite frankly, is not working as well as I would like to see it 
work.  Like a lot of insurance, it tends to work well if you 
never have a claim.  But if you have a claim or repeated claims, 
it tends to work to your prejudice, particularly if you don't 
have production history.  
	     
	     We're working on this ourselves, internally, but one 
of the other things the President instructed me -- if you read 
his letter to Senator Daschle -- he instructed me to augment our 
ways to improve the operation of the crop insurance program to 
make sure it worked satisfactorily in an all-risk type capacity.  
	     And what we have particularly seen in the areas like 
the Dakotas and the Texas High Plains is repeated disasters, and 
where repeated disasters occur, that tends to reduce payment 
rates under the current crop insurance program.
	     
	     Q	  In Texas, as you know, Governor Bush yesterday, 
I think, announced he wants to declare the whole state a disaster 
area in order to partake in various agriculture programs.  Will 
this speed your processes along, or how will that affect --
	     
	     SECRETARY GLICKMAN:  Well, we get these disaster 
requests county by county.  Texas has an awful lot of counties.  

And it may help if it's done on a larger area.  I can't -- this 
money that we're talking about that's in a Senate bill, 
obviously, will help.  As you understand, most disaster 
declarations do not trigger anything except low interest loans 
and related things.  They don't trigger in the old ad hoc 
disaster assistance.  They do trigger in both some USDA and SBA 
authorities.  
	     
	     But maybe doing it statewide might accelerate the 
process.  I have instructed our folks to move these disaster 
applications as quickly as possible.  I mean, I don't want any 
delays to take place.  But a lot of folks are finding it rather 
depressing to note that other than crop insurance, there really 
is no disaster program out there that is statutorily authorized 
anymore, and that crop insurance under law must be run in an 
actuarialy sound way.  So we basically have to run the crop 
insurance program as if we were running, in a sense, a commercial 
insurance program -- with some exceptions.  
	     
	     And I think that's where a lot of farmers are 
finding it unsuitable, certainly compared to what we had in 
decades passed.  And that is one of the things the President has 
asked me to look at, is what changes can we make in the crop 
insurance program to make it more suitable.
	     
	     Q	  Secretary Glickman, do you expect to go beyond 
grains into beef or --
	     
	     SECRETARY GLICKMAN:  Well, we will see what the 
country's needs are.  There's been some discussion that wheat 
flour may be used in some areas.  We have the authority to 
purchase what, Chris --
	     
	     MR. GOLDTHWAIT:  Any commodity in surplus, but we 
would focus on the tradition food aid commodities.
	     
	     SECRETARY GLICKMAN:  Any commodities in surplus -- 
as he said, we focus on traditional food aid commodities because 
they are obviously there, easier logistically to move, to 
transport, the infrastructure is there.  I do know that flour has 
been one of the items that we have heard that some folks may find 
that they need. 
	     
	     Q	  Also, you were around during the last farm 
crisis in the '80s.  How do you compare what's happening today 
with what was going on then?
	     
	     SECRETARY GLICKMAN:  Well, I've been around about 
three of them, actually.  I was there in the '70s, and I would 
say that we've had -- one of the things we've had is we've had 
two fairly good years in agriculture in '96 and '97, So we have 
not had the dramatic reduction on land values.  And by and large, 
the credit situation today is better than it was back in the 
1980s.  But saying that, you've had a precipitous fall in prices, 
a very rapid fall in grain prices, and you do not have a loan 
program, the commodity loan program acting as any kind of a floor 
on price today as it once did.
	     
	     So I think it creates a potential vulnerability out 
there which could be as great as the previous crises.  As of to 
date, it is particularly bad if you live in areas that have been 
hit by a disaster, however.  That is why it is so imperative that 
Congress pass the disaster assistance -- the indemnity assistance 
that Senator Conrad and others have pushed in the Senate bill.  
That is something that must be done to save thousands of family 
farmers in the very short-term.
	     
	     And I think the action the President is taking today 
will provide some longer-term bullishness and stability to the 
market price.  But we have a lot more to do, to sit down and, 
hopefully, in a bipartisan effort -- work together with Congress 

to find creative, positive ways to strengthen the basic farm 
economy that's out there, both from a trade and export situation 
as well as from a domestic price situation.
	     

	     And as I've said many times before, as the President 
said when he signed the 1996 Farm Bill, he said there are some 
very good things in this Farm Bill -- the planting flexibility 
provisions, the rural development provisions.  But it did not 
provide much of a safety net when prices went way down.  And 
ironically, a lot of money was paid out at a time when prices 
were high.  
	     
	     And so I think the President's words are coming back 
to be quite prescient, and we're just going to do what we can to 
work together with the Congress to see if there are some 
structural things we can do with this farm bill to ease the 
situation over the long-term.  But these steps we're talking 
about will do quite a bit of good over the short-term.
	     
	     Q	  The NAACP recently met with Mr. Gore and said 
that black farmers were suffering disproportionately more from 
the crisis.  Does this initiative in any way address that?
	     
	     SECRETARY GLICKMAN:  Not directly.  But what it will 
do is, of course, a lot of minority farmers have been hit by 
disasters in the same way that non-minority farmers have been 
hit.  I was down there, I addressed the NAACP, myself, during 
that meeting.  And, of course, we've seen a larger, 
percentage-wise, loss of minority farmers than non-minority 
farmers.  But I would say that all farmers, all family-sized 
farmers had great difficulty over the last 20 or 30 years, 
particularly in coping with volatile prices and crop disasters.  
And that's one of the reasons, particularly for smaller and more 
vulnerable farmers, that we have a crop insurance and a risk 
management system that's suitable for them.
	     
	     Q	  Just to follow up, I think both the House Ag 
appropriations bill and the Senate appropriations bill increase 
the window of time of the statute of limitations so that people 
who feel that they have been discriminated against or wrote 
letters, what have you, can pursue a case in your civil rights 
office.
	     
	     SECRETARY GLICKMAN:  Correct.
	     
	     Q	  And when you spoke, though, at the meeting in 
Atlanta, were you not saying that that gives everyone a chance, 
who feels that they have a complaint, but they need to have some 
proof before they can receive any sort of settlement?
	     
	     MR. GLICKMAN:  During the 1980s, the Reagan 
administration disbanded its Civil Rights Enforcement Office.  
And for many years, claims, complaints were lost in the bowels of 
the Department of Agriculture and elsewhere.  And the Justice 
Department has determined that there is a two-year statute of 
limitations that applies under the statute, which allows the 
government to provide affirmative cash recovery for people who've 
been discriminated against.  And that is not waivable.
	     
	     So the administration has strongly supported an 
effort to give people an additional two years to file their cases 
-- that's basically waiving the statute of limitations.  It is in 
both the Senate and the House appropriations bill.  And because 
of that, my believe is it will be in law.  However, that is not 
an automatic determination of liability.  People who file will 
still have to document their cases.  And there will be a process 
by which they will either be accepted or rejected, as we have 
done previously.
	     
	     Thank you. 

            END                        8:45 A.M. CDT

 

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