SENATOR DEFENDS U.S. MANDATORY FARM CONTROL BILL
  Sen. Tom Harkin, D-Iowa, defended his
  controversial mandatory supply control farm bill and said U.S.
  farmers should be allowed to vote in a referendum whether they
  approve of the proposal.
      The Harkin proposal would set loan rates of 5.17 dlrs per
  bushel for wheat, 3.77 dlrs for corn and 9.32 dlrs for
  soybeans, all to be put in effect under strict controls on
  planted acreage reductions. Present loan rates are 2.28 dlrs
  for wheat, 1.92 for corn, and effectively 4.56 for soybeans.
      Also under the plan, the U.S. would seek a world market
  sharing cartel with the European Community and other exporting
  nations, to share-out export markets, Harkin said during the
  first of several Senate Agriculture subcommittee hearings
  examining farm programs.
      Harkin made the following claims in testimony on his
  "Family Farm Act."
      -- The mandatory control bill would increase farm income
  and reduce government spending on agriculture.
      -- Harkin said his policy of high price supports would not
  ruin U.S. agricultural exports as critics claim, but would
  increase overall revenue from exports.
      This would be done by seeking agreement among major
  exporting countries including the European Community on market
  sharing at agreed high prices.
      Sen. Christopher Bond, R-Mo., countered during the hearing
  that such a grain export cartel is not workable.
      -- Harkin acknowledged that higher commodity price supports
  would be passed onto consumers, but he said high food prices
  stem more from "gouging" by food processing companies than from
  high farm product prices.
      Harkin cited what he termed "excessive" net returns on
  equity over five years of 33.4 pct at Kellogg, 31.9 pct
  Monfort, 22.8 pct Nabisco, 22.8 pct ConAgra, 21.2 pct H.J.
  Heinz, 19.1 pct Ralston Purina, 17.2 pct Pillsbury and 16.7 pct
  Quaker Oats.
      -- Harkin said a "legitimate" concern about his bill would
  be the impact of higher prices on livestock producers.
      He said as a transition to the higher prices, he would
  allow livestock producers to purchase Commodity Credit Corp.
  grain stocks for three years.
      Thereafter, livestock farmers would benefit from a
  "predictable and stable" grain price, he said.
      -- Harkin said that under his policy approach farm
  participation would be no more "mandatory" than the current
  farm program. He said farmers now must participate in farm
  programs in order to receive credit for planting and to protect
  farm income.
  

