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Capitol Comment
by Senator Kay Bailey Hutchison
Supporting Texas’ Family Farms
August 3, 2007
The American statesman Daniel Webster rightly considered farmers the “founders of civilization,” and nowhere is this more true than in Texas. Our earliest pioneers came here to settle and work the land, and their resolve helped our state to grow and prosper. The family farmers and ranchers of today carry on this spirit, and remain vital to our economic success and unique culture. One in every seven Texans is employed in agriculture, and family farms and ranches contribute billions of dollars annually to our state economy. Texas is also home to more farms and ranches than any other state, and has the country’s second highest annual revenue from agriculture. Upon return from August recess, the U.S. Senate will debate a new farm bill, and in its consideration I will continue to work for our family farmers and ranchers who uphold Texas’ legacy of leadership in agriculture.
Federal policies should support the farmers and ranchers who feed our nation. The current farm bill, which I helped pass in 2002, provided an important safety net for our family farmers and ranchers and has produced stable commodity prices, spurred additional investment and increased exports in each of the last four years. However, many of its key programs are set to expire in September unless they are reauthorized by Congress. I will work with my Senate colleagues to preserve the positive aspects of the 2002 bill in new legislation.
Elimination of the unfair Death Tax would also benefit family farmers and ranchers by allowing them to pass the fruits of their labor on to their heirs. In Texas we understand the special connection between a family and the land they have worked for generations. Sadly, when a loved one passes away, their heirs may be surprised to learn that the value of their estate exceeds a low federal tax threshold due to appreciated land or equipment. These families are all too often forced to sell their farm or ranch to pay the resulting bill. Due in part to the Death Tax, only an estimated 30 percent of family businesses, including farms and ranches, survive the second generation and only 13 percent survive the third.
The Death Tax has been gradually phased out under the Tax Relief Act of 2001, but will return in full force in 2010. If Congress does not extend the phase-out or provide a permanent exemption, the estates of farmers and ranchers who have paid income taxes for years will once again be double-taxed at up to 55 percent. For their sake, complete and permanent repeal of the Death Tax is one of my main priorities.
We must additionally ensure that our farmers and ranchers can compete fairly in an increasingly global economy. I have advocated for free trade agreements such as NAFTA and CAFTA, which have created billions of dollars in revenue for our family farms by introducing American food and fiber products to new markets across the world. And, as long as other countries subsidize their agricultural products, we must continue to provide the safety net that has helped American agriculture thrive.
Unfortunately, even the best policies and legislation can be overcome by the forces of nature. Last year, Texas experienced one of the worst droughts in our history and our largest single wildfire on record. Fires destroyed almost 1.5 million acres in the panhandle alone. After these calamities, I worked to direct $12 million in funding to farmers and ranchers in Texas through the U.S. Department of Agriculture. I was also able to secure $3 billion in aid in the Emergency Supplemental Appropriations bill passed this spring. As heavy rains flooded much of north and central Texas this summer, I worked directly with federal and state officials to obtain disaster declarations for the affected communities and make them eligible for federal aid.
Agriculture is the foundation on which Texas was built, and our farming and ranching families continue to make it one of our state’s most important industries. Their hard work and dedication to the land deserve our support, and I will continue to make their needs a top priority.
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