Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 7 - Evidence
OTTAWA, Thursday, April 6, 2000
The Standing Senate Committee on Agriculture and Forestry met this day at 9:02 a.m. to study the present state and future of agriculture in Canada.
Senator Leonard J. Gustafson (Chairman) in the Chair.
[English]
The Chairman: This morning we are pleased to have Mr. Pletz, from the Saskatchewan Rally Group.
I should like, Mr. Pletz, if you could tell us a little bit about your farm, exactly where you are from in Saskatchewan and a little bit about the organization that you represent, and then we will hear your presentation and go to questions. Please proceed.
Mr. Lloyd Pletz, Director, Saskatchewan Rally Group: On behalf of the Saskatchewan Rally Group, thank you and good morning, senators. We are a grassroots farm group. We originated as a branch of the Pro-West Rally Group. Bob Thomas and myself started the new rally group in Saskatchewan to get back on the inside so that we could meet with people such as you and MPs and MLAs at the provincial level.
I farm six quarters of land, just short of 1,000 acres. I am facing bankruptcy and foreclosure because of the farm crisis. I am here today more because of the human aspect of the crisis back home, such as divorce and lots of suicides, especially since the last federal budget due to the lack of federal aid to agriculture.
I believe our province is hurting the worst because we are the largest grain and oilseed sector. Our province may be facing bankruptcy within a year or two because of the farm crisis. There are bankruptcies and foreclosures, farmers who cannot afford to seed this year, farmers who will not seed because they pencilled in the numbers and know they cannot make a dollar at it, farmers who will make more summer fallow, and farmers who will put in half a crop with little or no inputs. All of that will be such a big financial hit to the Province of Saskatchewan as far as generating wealth and taxes that I believe my province may be bankrupt by the end of this year. My province cannot afford that kind of drop in wealth and taxes generated; neither can the federal government, frankly.
I have passed around some charts and graphs. The main graph I should like to present is the Saskatchewan income chart. I will talk mostly about my province's numbers. That graph is from the Reform Party's office on the Hill. I modified it a little to show or explain more where we are in Saskatchewan. As you can see, the chart consists of farm income in Saskatchewan versus our expenses in Saskatchewan. I drew some arrows towards the bottom right hand corner where I wrote "accounts payable". That is where I am and where thousands of other farmers are. I put that on there because accounts payable do not show up in the cash filing of income tax in the net numbers.
In 1998 I finished the year off with my line of credit gone, and right now my accounts payable, including my line of credit, have tripled for last year, 1999. That is where the majority of farmers are. We are going off the bottom corner of the page as far as accounts payable. Accounts payable are not included in the cash filing of income tax because they are not an income tax deductible item on the cash filing of income tax.
I should like to say at this time that I believe all farmers should file income tax on an accrual basis so that our accounts payable do show up in the net numbers. Then there would be no political football on the number situation kicked back and forth between the provincial and federal levels.
Some farmers have covered a lot of their accounts payable. That is where our losses are, senators, in our accounts payable. They are not in the income tax numbers. For example, according to the net numbers for Saskatchewan shown on that other chart, we need only about $12 an acre to get back to the five-year average. However, according to Saskatchewan Agriculture and Food in an article in The Star Phoenix, on a three-crop average we farmers on average lost $65 an acre. Using those figures, the $12 and the $65, you can see that less than 20 per cent of our losses are in the net numbers. Over 80 per cent of our losses are in accounts payable. In other words, 80 per cent of our farm crisis is not in the net numbers, and the crisis is approximately five times worse than both levels of government think it is.
If you look back at that first graph, you will see that I drew a line across the top. That is where our cost of production is. We have to get our expenses back to stay viable. Our expense line is your cost of production. You notice where our net numbers are running across the bottom there. I blame the majority of the farm crisis not on the subsidy wars but on the multiple effect of income tax. What I mean by "multiple effect" is that the manufacturer pays income tax, the wholesaler pays income tax, the retailer pays income tax, and every time that income tax load is passed on. By the time it hits me, Mr. Farmer, the fourth person in that chain, the income tax has multiplied and magnified. When I buy something from the manufacturer, the wholesaler, the retailer, the income tax has tripled the load of that, and as a farmer, I cannot pass that load on past my farm gate. It stops dead at my farm gate. I am the end user of all that taxation.
Another big culprit I blame the crisis on is bank profits. When I started farming in 1973, there was only a 2 per cent spread between the money I saved in a savings account versus the money I borrowed for a mortgage or equipment. Today that difference is five times as much. It is approximately a 10 per cent spread between the interest I could collect on money I saved versus what I pay for a mortgage or an equipment loan.
The biggest culprit is corporation profits. I have an NFU book with me that indicates that there are corporations making profits as high as 222 per cent on the processing side. We have equipment companies making 25 per cent. That is what has driven our expenses through the roof. It is not the subsidy wars that have driven our expenses through the roof. It is the subsidy wars that are keeping our income down from following the expenses.
I have also provided you with a number sheet that came out of the U.S. Department of Agriculture. At line 3 you see that $52 billion was spent in agriculture support payments for 1997. Following that line across, you see that support payments in agriculture are anywhere from $52 billion up to $63 billion, and they even have estimates for up to the year 2004. The U.S. is supporting its farmers in the $54,000 to $56,000 range. U.S. farmers are still going bankrupt because, as you notice, the support levels are stable on a yearly basis; the support is not following the cost of production or the expense line, which is going through the roof.
Turning to the page that lists federal and provincial expenditures in support, you can see that back in 1991-1992 federal support to Saskatchewan was about $2.8 billion. Now it is approximately $800 million. That is a big drop. There is a subsidy war on and the support is dropping off. That is a double whammy. Instead of holding support for a subsidy war they have gone backwards, and that has basically doubled the farm crisis for agriculture across Canada.
On the bottom of that page I have calculated some totals for Canada. In 1991-1992, federal and provincial support was over $9 billion. In 1998-1999, it was $3.9 billion -- less than half what it was back in 1991-1992 after we finished the last subsidy wars in the late 1980s.
Our support has been cut by more than half in the middle of a subsidy war, and it is a large subsidy war. That is why our income is falling below zero as far as the sheet goes. As far as the sheet goes, the net number line should be below zero for the last number of years, if income tax is filed on an accrual basis. If you go back to where the net numbers spread from the expenses, you can see that we farmers have not made a living on the farm since 1975. That is when the expenses and the net income separated. Right now, my accounts payable are off the end of that sheet. To get my cost of production losses back, to get my head back above water, I need a substantial cash injection.
Back home there are thousands of farmers who cannot seed; because of that there are financial cash flow problems. We still have to make mortgage payments, rent payments, equipment payments, and so on, and we cannot do it. The minute we do not seed, and we cannot seed, we are bankrupt. That negative aspect has already spilled into small-town Saskatchewan. Three businesses went down in one town in one day. My rally group right now is compiling a list of names of farmers and businesses that are being bankrupt or foreclosed on. I will try to provide that to you next week.
I know of about half a dozen suicides within a 50-mile radius of myself. There are a few more that I am aware of. There are probably others that I am not aware of. Farmers have farmed for 20 or 30 or 50 years and have lost everything. Suicides are a result not just of the financial situation.
Farmers cannot access welfare at a provincial level because we have our names on equity or on a piece of equipment or the welfare department looks at our cash filing net numbers, which show that we made money last year. I have not got my 1999 income tax done, but in 1998 my line of credit disappeared and I was maxed right out at $20,000. Nevertheless, my income tax showed that I made money. I had to pay income tax in 1998 when I lost thousands of dollars. I believe it will be the same situation for last year.
The cash filing does not work for the farm sector. I believe I will be paying again for 1999, but my accounts payable are up to about $60,000. That is where our losses are, and I believe neither level of government has those numbers. No level of government has my accounts payable. They do not know how much of a line of credit I have out. There are farmers who have a $150,000 or $250,000 line of credit out and the bins are empty. They cannot pay that money back. The governments do not have those numbers. They do not have the numbers on how many mortgage payments I have missed, how many equipment payments I have missed, how many dollars I owe on my fertilizer bill or seed bill or chemical bill or other bills. The governments do not have those numbers. They might have the Farm Credit numbers, but that is about the only account payable or arrears that they might have access to.
I covered some of my accounts payable. I lost approximately $100 an acre in the last two years. In other words, I should have lost $100,000, but my accounts payable are down to $60,000 for the simple reason that I sold some cattle. I have neighbours who sold their whole herd. That is lost income for future years, so they are basically sunk, facing bankruptcy or foreclosure in the next year or two. Many farmers have sold their equipment. That is another way I paid some of my accounts payable. I sold some of my equipment for about $10,000 or $20,000. I also went without groceries and cut corners wherever possible.
There is a human aspect to this crisis. My marriage fell apart. I went through a divorce about a month ago. Two of my three kids will not talk to me because I had no dollars to give to their mother to get re-established in town. It goes on and on like that. I could tell you numerous horror stories, but I thought I would just explain my own here a little bit.
I basically accepted the fact that, with our federal and provincial agriculture policies, but mostly the federal ones, my federal government is bankrupting us on purpose. The farmers who cannot cope or accept that fact are committing suicide or have gone into a deep depression. I cannot believe that we farmers are the only sector in Canada that generates the amount of wealth we do and at the end of the year we cannot afford even to buy groceries for our own families. Even the people on welfare are allowed the cost of living.
I cannot believe that the government has the majority of us farmers holding down two and three jobs where most sectors hold down only one job. We have farmers working around the clock, 20-hour days, to hold an off-farm job and hold the farm job and keep the farm going. That is ridiculous and insane. Why should we, because of agriculture policy, have to hold down two and three jobs? There are spouses passing in the night; some have day jobs and some have night jobs and they never spend any time together. That is seriously affecting the raising of their children. The children do not see their mom or dad, or the parents do not have any time to spend time with them off the farm doing the things that kids should normally be doing at their age. The kids do not have a life. They go to school and they come home and chip in with chores or whatever, or they do not see their parents. In a lot of cases I see the kids raising themselves, which is not good for our society. That is where a lot of kids are going wrong nowadays. They do not have their parents to raise them or guide them through their younger years.
We need our federal government to get into these subsidy wars and support us at levels comparable to what the U.S. and Europe are doing. I have another table from Mr. Proctor's office on the Hill. I believe he got the numbers when he was over in Europe. There are sectors for wheat, milk, beef and veal, and all commodities. As you can see in the milk sector, Canada is basically supporting the Canadian dairy industry. It is pretty well equal to what the U.S. and Europe do. The numbers are self-explanatory for beef and veal. The big drawback is the wheat sector, and you have all heard the numbers: 9 cents for Canadian farmer support, 56 cents for the European Union and 38 cents for the United States. One of the main reasons farmers are going broke is that we are going up against the U.S. and European treasuries on our own. That is why we are facing bankruptcy. We need the federal government to get the monkey off our back; if they do not, we are all broke.
I expect a quarter of my acres in Saskatchewan not to be seeded this year. Using that as an estimate of farmers in general, that is a guarantee that a quarter of the farmers will go broke this spring. I also estimate that, if they do put in a crop at today's grain prices, come fall another quarter will also be facing bankruptcy or foreclosure.
There is a big meltdown in my province. As I said, I believe it is from being the biggest grain and oilseed province in Canada. Everything is going backwards and it is a chain reaction. What I see and hear happening now is that, on a tonne of fertilizer, the manufacturers are taking down the wholesalers, the wholesalers are taking down the retailers, and the retailers are taking down us farmers.
Two weeks ago about 250 letters of intent went out to the town of Wingard; the retailers are trying to collect on outstanding farm accounts. They are doing it because the wholesalers are pressuring them to do it. The wholesalers are after the retailers. Fertilizer is all passed on credit. Because of the agriculture policies, we have the credit not just at the farm gate. We have been farming on credit for years. That credit is gone. Most of us are maxed right out. That is why we do not have a dollar to put a crop in. We lost $65 an acre last year, according to Saskatchewan Agriculture and Food. The previous agriculture minister stated that we lost $40 an acre in 1998. There is that $100 an acre that I and every grain farmer in Saskatchewan has lost.
From this last special $1-billion injection of cash into agriculture in Saskatchewan and Manitoba, probably all I will see is $5 an acre. I will get $5,000 when I have lost $100,000 over the last two years. That $5000 will not even buy the groceries for the year. I look at it as welfare money or transition money.
The Chairman: Will you receive that money or will your banker receive that money?
Mr. Pletz: I am not sure. People might be able to latch on to that, the bank or the creditors. It is supposed to be a cash injection based on NISA numbers from 1998 and previous years so that they can kick it out as soon as possible since they have our 1998 and previous applications. It amounts to about $5 an acre from the NISA account directly to the farmers. What is $5,000 when I have $60,000 in arrears to pay? It is an insult; it is not even grocery money for the year.
I have not got a penny to put a crop in, the same as thousands of other farmers. We have a massive meltdown and the meltdown has gone into small-town Saskatchewan. I have been hearing businesses in Regina, including three larger ones, talking about closing their doors. We have already had car dealerships going bankrupt and closing their doors. By the end of the year, my whole province will have its doors closed. The meltdown is on and the only way to stop it is one large cash injection. We have not seen that and it does not look like we will see it.
Crop insurance has been a big failure. In the early 1990s it was changed from area coverage to individual farmer coverage. Since then, mother nature has ratcheted down our coverages on a bushel coverage. I started out with about a 30-bushel-an-acre coverage back in the early 1990s. Today, on average, my coverage has dropped by 50 per cent or 60 per cent. In other words, the coverages are that much farther away from the cost of production. Crop insurance has failed just because it was changed to individual coverage. It should be changed back to area coverage.
The biggest problem with NISA is that there are never enough dollars in there to cover our losses or to keep our heads above water. NISA would give me $1,000 or $2,000. I need $60,000. Part of the problem with NISA is that I could not access my money when I needed it. The reason is that accounts payable use the net numbers and accounts payable do not come into effect there. If accrual numbers were used for NISA triggers, that would work very well, but right now the cash filing numbers and net numbers are being used and accounts payable do not come into play. I probably cannot access it now for last year, and I could not access it in the spring of 1999 for my 1998 losses. The trigger for NISA should be removed completely. I should be able to access it freely when I need it.
Another problem with NISA is that the rich farmers get richer and the poor get poorer. The poor farmers who actually need the money have no money in their accounts or only a minimal amount of money in their accounts, compared to our cost of production losses, or they cannot access that money. The larger farmers who are debt free can afford to put money in. They are the ones with the big NISA numbers that Mr. Vanclief talks about on a regular basis. They can afford to put dollars in and they receive the higher interest rate. That is magnified.
It should be capped. The richer farmer should be capped lower on the interest or lower on the matching contributions. More dollars should be channelled to the poor farmers, the ones who are younger or who are farther in debt or who cannot afford to put a dollar in there. It could be improved that way.
AIDA -- Agricultural Income Disaster Assistance -- is the biggest Canadian agriculture joke I have ever seen. I have been dealing with Mr. Steve Dunnigan out of Mr. Vanclief's office just this last week or so. AIDA cannot be fixed. For example, Murray Downing, a farmer from Manitoba, was here. Compared to me, he is really into the numbers of the AIDA program. We threw an extra $50,000 worth of expenses into his personal AIDA application. By throwing in $50,000 more in expenses, Murray Downing triggered $25,000 less in support. After that, I realized that throwing in expenses does not trigger more support. AIDA is based more on the income aspect instead of the expense aspect.
When I talked with Mr. Dunnigan yesterday, I asked him what would happen if we threw in $50,000 more in income, since the $50,000 more in expenses did not seem to improve the assistance. Mr. Dunnigan said that in some cases some farmers might trigger more, but they also might trigger less. In other words, it does not matter whether we throw more income or more expenses into AIDA applications; the program is not consistent so that the majority of farmers could access it. The triggers are not consistent.
I made a suggestion to Mr. Dunnigan. Under the GATT rules, the federal government is allowed to support us up to 70 per cent. I suggested that our federal government could maybe keep a simple program and take 70 per cent of our accounts payable. Mr. Dunnigan said that we can play around with our accounts payable. We can, but why not go back one year? It is after the fact.
The support should be based on 70 per cent of the cost of production. The problem with all three programs -- crop insurance, NISA, AIDA -- is that none of them is tied to the cost of production, which is basically your expense line on the sheet. The only way AIDA can be fixed is to put in a cost-of-production formula. The only way NISA can be fixed is to put in a cost-of-production formula. The only way crop insurance can be fixed is to put in a cost-of-production formula. Somebody must tie something to the cost of production. Cost of production is where we farmers break even. That is where we get to put a zero on our income tax every year. We are still sustainable and viable, and we can still seed this spring and next year.
That is the only solution to saving the farm sector right across Canada. It is the only solution to everything. It is the solution of putting the young farmer back on the land and letting the older farmer retire. It is the only solution. Without a cost-of-production solution, the whole agriculture industry, especially the grains and oilseed sector, is being flushed down the toilet here.
I predicted this meltdown a year ago. Mr. Thomas and I did an Agridome rally in Regina and I predicted it then. It is already a chain reaction right back through the retailers, wholesalers, and manufacturers. The chain reaction goes into the bigger cities of Saskatoon and Regina where businesses are closing their doors. The Massey Ferguson dealership in Regina closed its doors a few months ago. Now anyone who needs Massey parts has to run another couple of hundred miles one direction or another.
In the information I gave you I included a PIMA membership survey. PIMA is the Prairie Implement Manufacturers Association. The questionnaire was sent out to the dealerships. There are two pages with five questions on each page. One was just recent and one was a few months older. I do not have the dates for you. I will not go through the questions with you -- they are self-explanatory -- but you can see that you can compare the answers to the same questions on the two pages. For example, earlier, when asked about expanding their business, 12 businesses said yes and 14 said no. Now, however, one business says yes and 23 say no.
We have businesses talking about moving out of Saskatchewan. I understand from my provincial government that many of the equipment dealerships and second-line manufacturers have been invited down to the U.S., and some of them are considering going. I am trying to have a couple of names verified and get permission to use them here on the Hill with senators and MPs. I know of a few people who are moving to the United States. People are going to leave Saskatchewan.
In Saskatchewan, health care is a big issue. My premier has told me that we need $160 million to keep health care going in my province. Between the agriculture crisis and the health crisis, my premier is taxing us more to death in the last provincial budget in every area he can. It used to be $100 to get into a provincial park. It is now over $400. Fishing licenses went from $10 or $15 up to $45. Our premier has to tax us to death. It is driving out the people, driving out the business, and in effect it is killing the whole province. That is thank you to the federal policies on health care and agriculture.
I have talked about the desperation. I faxed a letter to my Canadian ambassador to the United Nations with a lot of things in it. The biggest problem we have at the farm gate is that we are the end user of the taxation. We are the end user of the corporate profit. We are the end user of the bank profit. The biggest problem is the way the taxation is set up in Canada. As I tried to explain earlier, to have a business you have overhead, you have your profit picture and you pay your income tax load. All three things are passed on from the manufacturer to the wholesaler, who has the same three things, and then to the retailer. All those costs are included in a tonne of fertilizer, and from the manufacturer to the wholesaler to the retailer they are all magnified. The majority of our inputs have doubled in price due to taxation and corporate profit and bank profit. Mr. Goodale spoke to my Pro-West Group and said that, on average, approximately 49 per cent of our inputs is tax. That is why the expenses are running away on our income, along with the corporate profit and the bank profit.
One of the reasons that we cannot pass on a lot of our costs and expenses to the corporations or the middlemen after the farm gate is that the middlemen after the farm gate want a lot of leeway and room so that they can make profit before our produce or grains or oilseeds hit the consumer plate. I have an NFU book that shows that General Mills made a profit of 222 per cent. We need our federal government to share the profit. There is enough profit in the whole agriculture industry to make everybody rich or everybody profitable.
I sat in on Mr. Vanclief's meetings in the last two days. He was at the House of Commons Standing Committee on Agriculture and Agri-Food. He said that the industry is enormously profitable and markets are developing and everything is so positive. I think he just forgot Mr. Farmer in his scenario. He does not believe we farmers are part of the agriculture industry as far as the $90-billion worth of profit we produce or the $90-billion worth of wealth we generate, never mind the taxes on that to both levels of government.
The Chairman: I want to thank you for a very detailed report of the situation. How do you read the marketing board sector of agriculture? They have a guarantee. There is no question about that. The way the marketing boards are set up for the milk producers, the chicken producers and the feather industry, they receive a margin.
Mr. Pletz: They get their cost of production. That is the problem in the grain sector. The biggest problem in the grain sector is that we export approximately 80 per cent of our grains. That is where it becomes a little hard for the federal government to give us cost of production. But if they do not, if the farmer goes, then everybody else goes too, including the middlemen before and after the farm gate. The whole industry melts down and disappears. If we go, they are next.
The Chairman: There are those who argue that if all marketing boards were removed, the reality of a level playing field would come to Canada. In other words, Western Canada in the grain industry now does not have a level playing field with Ontario or Quebec or Eastern Canada because of the marketing board situation. We do not have a level playing field with the United States because of their subsidies.
Senator Robichaud: I do not agree. That is debatable. I do not think you should make those assertions.
The Chairman: In all due respect, as an active farmer myself, I think we have had some experience with what is happening. If the Government of Canada does not recognize what is happening, we are in very serious trouble.
Senator Robichaud: I disagree. I do not think that people out West would like to see the farmers in Ontario and Quebec in the same misery they are if the marketing boards were eliminated.
The Chairman: I never said that.
Senator Robichaud: I thought I understood you to say that if we eliminated the marketing boards, we would have a level playing field. I am sorry if I misunderstood, but I just wanted to make that point.
The Chairman: Your point is well taken. I do not want to take anything away from the dairy and chicken producers, but we need the same kind of consideration.
Mr. Pletz: Right. The inequality in agriculture is that there are supply management boards or management boards in dairy and chicken and turkey where they do get the cost of production. I notice that Ontario has a market revenue insurance program. The reason Ontario has that when the rest of Canada does not is that Ontario does not export 80 per cent of what is grown there. They pretty much eat it all. That is why there is no countervailing involved there. It is harder to put a revenue insurance program back in Manitoba, Saskatchewan and Alberta because we export 80 per cent of our stuff. Countervailing would be frowned on because of that. However, if we do not have revenue insurance or cost of production, the farmers will continuously will go broke. I can see my province going back to grass and buffalo.
The federal and provincial governments have drawn a line between Regina and Saskatoon. They both have stated to me that east of that line, all grain farmers have to go to intensive livestock. Do you know what will happen if we go to intensive livestock and double or triple or quadruple the hogs and pigs and chickens and cattle? The price will fall to nothing and we will have the same scenario. We will be facing bankruptcy and foreclosure the same as we are today on the grains and oilseeds side.
The reason they are saying east of that Regina-Saskatoon line is that that is where the highest freight rate is. Given another year or two of these subsidy wars, the grains and oilseeds sector on that side of the Regina-Saskatoon line will not be economical either because the grain prices are still going to go down or stay at the levels they are at today, which are not sustainable. Basically, until our federal government gets into the subsidy wars and supports us, we will sink. The subsidy wars have driven down our net income or driven down the grain prices and will continue to do so.
Senator Robichaud: You opened up your statement here by saying that the subsidy wars were not causing the problem.
Mr. Pletz: They are causing a portion of the problem, but I blame the majority of the farm crisis on our expenses going through the roof. The subsidy wars did not cause our expenses to go through the roof. Government taxation, corporate profit and bank profit has caused that. The subsidy wars have driven our income, according to the cash filing in income tax, below zero. They are having an effect, but I still blame three-quarters or more of the subsidy wars on our expenses going through the roof. It is not so much the subsidies that are driving our expenses through the roof as it is our own Canadian policy on taxation and allowing the banks and corporations to gouge on the prices of all our inputs or gouge us after the farm gate.
Senator Robichaud: You have painted a pretty dark picture. Maybe there are a few flashlights somewhere to shed some light, but it looks pretty dark. I do not doubt you. You are out there; you are living the situation.
Did you say you have fewer than 1,000 acres?
Mr. Pletz: I have six quarters, which is 960 acres.
Senator Robichaud: You are looking to seed?
Mr. Pletz: No, I am finished. I have to go home and declare bankruptcy, if my bank does not beat me to it by foreclosing on me.
Senator Robichaud: What could save you?
Mr. Pletz: A cash injection. I need about $60 an acre to have my accounts payable caught up, to get my head back above water. If my accounts payable are caught up, then I can go and get a production contract from my elevator and I am back on credit again to put another crop in the ground. Right now I have no credit from my bank or from my grain buyer. The last number of years the majority of our farmers have been getting production contracts where we can defer our inputs until fall and hopefully have enough money from the crop in the fall to pay that back. A lot of us, including myself, could not pay the inputs back. They were interest free until October and then I got hit with interest retroactive all the way back to May 1, 1999. That cost me another $3,000 or $4,000 or $5,000 in interest.
To keep the farmers on the land, we need a large cash injection so that we can get our accounts payable caught up or possibly get a dollar to put in a crop. If we do not seed a crop, we are all bankrupt.
Senator Robichaud: But you are saying that even if you put in a crop, you are losing money.
Mr. Pletz: Yes. It is a Catch-22 right through.
Senator Robichaud: It is.
Mr. Pletz: We are damned if we do and damned if we don't. Why would you seed a crop and lose more money? That is why I mentioned at the start that probably another 25 per cent of farmers will be bankrupt this fall simply because they lost more money by seeding. But if we do not seed we lose our farms. It is a Catch-22. That is why we are in hell.
Senator Robichaud: Those of you who have other jobs to try to put food on the table are using some of that money to keep your farms going. If you seed, then you will have to use some of that money to lose more money.
Mr. Pletz: That is the scenario. All of the off-farm job money is being lost in the farm. Even people with two and three jobs and both spouses working off the farm are still facing bankruptcy because every dollar is being lost in the farm. We are not getting our cost of production due to the subsidy wars and due to the fact that our expenses, our inputs, have doubled on us. Our expenses are going through the roof. Nobody is controlling anything here. Nobody is controlling the government taxation and nobody is controlling the corporate profits.
The corporate profits should be capped. There must be some profit-sharing. Instead of a corporation making 222 per cent profit, allow them to make 100 per cent profit so that some of that profit could be channelled back to Mr. Farmer.
There are only three places we farmers can get our dollar: from the consumers, and that will never happen because they enjoy their cheap food policy; from the marketplace, and we cannot get it there because the subsidy wars have that all messed up; and from the government. Right now we cannot get it from the two and the only option we have is to get it from the government. The government will not do it. We are bankrupt. Basically, I view my federal government as bankrupting farmers on purpose.
Senator Robichaud: You mentioned the rich farmers and the poor farmers.
Mr. Pletz: It was an expression I used for the NISA account. There are a few farmers who are 65 or 75 years old who are possibly debt free. Even those farmers are starting to complain back home because they are using up their equity, assets and savings, and within a year they are going to be in trouble just like the majority of other farmers now who are carrying some debt or who have no place left to turn.
Not 100 per cent of the farmers in Saskatchewan are hurting. I estimate that 70 per cent to 80 per cent of us are in trouble. About 20 per cent of the farmers are debt free, older, and maybe have some savings and maybe do not have a mortgage payment.
Senator Robichaud: They are not corporations.
Mr. Pletz: No, they are older farmers.
Senator Robichaud: You say that 70 per cent are in trouble?
Mr. Pletz: Yes. I believe that 70 per cent to 80 per cent are in trouble. We are all getting the same price for our grain, so we are all losing money. That is the problem with NISA, AIDA and crop insurance, the inequality. We are all losing the same amount of money on a bushel of wheat. We are all losing the same amount of money on a bushel of canola. There is no equality at the farm gate or in the agriculture policies. In every other sector people get treated equally. For example, when you senators or the MLAs or MPs or the unions get a raise, everybody gets it. Everyone is treated equally. However, at the farm gate, what is happening now, especially in the AIDA program, is that approximately 25 per cent of the farmers get a dollar, but that is just a small fraction of their cost of production losses. Seventy-five per cent of us get nothing. Where is the equality in the agriculture industry? There is none. We are being discriminated against.
Senator Fairbairn: Thank you for coming here to meet with us, Mr. Pletz. I think you and I met before in Regina a year ago, and things have deteriorated since then.
As you are speaking with us today, if I am not mistaken, the farm safety net committee co-chaired by Mr. Friesen of the Canadian Federation of Agriculture is meeting here in Ottawa, presumably and hopefully to deal with the incredible enigma that has developed in the support systems for farmers. As you say, a small percentage of farmers appear to be getting support but a much larger percentage are not, no matter how much is put out there. A substantial amount of money has been put out there, but it does not seem like it because of the system under which it is being implemented. It seems that virtually no amount is going to a majority of farmers in your province who need the help the most.
Presumably that committee will deal with questions like incorporating margins and so on. Do you think there will be any light at the end of that meeting?
Mr. Pletz: No. Mr. Friesen and the safety net committee are meeting in Winnipeg today. They have five or six proposals of different programs related to revenue insurance or something along those lines or tied to the cost of production. I have no faith or hope in that because our federal government refuses to enter the subsidy wars or to support farmers up to our cost of production.
Until our federal government decides to put some money on the table and get into the subsidy wars, we can throw 150 cost-of-production programs at them and they will not look or take any one of them. The federal government is saying, "Here Mr. Farmer, here is X amount of dollars in the pot." They divvy it up between three programs now -- crop insurance, AIDA and NISA -- and the amount of money in the pot is so minimal compared to our cost of production losses that nothing is going to help us until the federal government comes up to the plate and offers enough to cover the $65-an-acre loss.
I have the Saskatchewan Agriculture and Food numbers with me that project the bushel or acre losses again. They are the same again. We are going to lose $60 to $70 an acre again this year.
Senator Fairbairn: What sum of money do you and your colleagues and friends believe would be necessary for the federal government to engage in the subsidy wars? I understand from listening to you today that there is more than one subsidy war. It is not simply the international one; there is a domestic one as well. Do you have a ballpark figure in your considerations that you think would be necessary in order to provide some type of assistance that would be relevant to your problem?
Mr. Pletz: I and thousands of other farmers back home have absorbed a lot of losses. We have lost the majority of our equity and assets. We have sold equipment and land just to keep our heads above water. For myself and my group, we need anywhere from $60 to $100 an acre, and we will need that same amount again at the end of this year. That is billions of dollars.
Senator Fairbairn: Looking across the spectrum, do you have any notion what that total figure might be?
Mr. Pletz: In my province, a payment of $60 an acre would amount to about $3 billion. Basically, we lost $3 billion last year and we are going to lose another $3 billion this year.
We are in arrears on our accounts payable and the interest factor is killing us. A lot of the interest on my farm accounts is 2 per cent compounded monthly, which is 28 per cent or 29 per cent per year. That is what many of our chemical, fuel and fertilizer providers are charging us. The $5 an acre I might get out of this last $1-billion injection to Saskatchewan will not cover my interest losses. For some farmers the $5,000 will not buy groceries and for others it will not even pay the extra fuel bill from the fuel prices going up.
Senator Fairbairn: This next question has always bothered me a great deal, and I know it bothers you a great deal, because I do not think Canadians understand that you are in a position where you cannot -- no matter what your situation -- access, even for fundamental needs, the welfare system because of your land equity. That is about as tough as it gets in our support system generally across this country. I do not think this issue is understood by many people outside those of you who are suffering from it the most.
Has there been any -- even in the recent budget -- consideration within the Saskatchewan government of doing something that would change that?
Mr. Pletz: No. My rally group and I were part of the sit-in at the provincial legislature. During that time I arranged a meeting with the Department of Social Services's Mr. Harry Van Mulligan. We had about 50 farmers in the room and the only solution we came out with was that Mr. Van Mulligan told us to apply and go through proper procedures. The only solution we see coming out of that meeting is that our wives and kids would have to separate and move to town to access welfare dollars. Again you have coming into play the break-up of families and divorce. You are destroying thousands of farm families here and it is because of the agriculture policies.
Everybody says that we farmers are a business. However, there is one big difference between being a business as a farmer and being a businessman in the city. We are directly affected by agriculture policy. Where is the policy that affects the businessman in town? We do or die.
I believe it is our federal government's policy to keep us farmers in the poorhouse. Now I believe it is our federal government's policy to bankrupt us or let us go. Whatever the financial reason or hidden agenda is -- I have some assumptions but I do not really care -- it is happening out there. That is the reality of it all.
Senator Fairbairn: I personally cannot share that conviction with you that there is a policy to do that. Our concern and the concern in this committee is to try to do anything we can, and we will be putting out a report when these hearings conclude. We have had a number of witnesses and people like yourself who are in deep distress. We hope we can offer some useful suggestions.
I am not in the position that you are to give up hope totally on governments being able to put together some assistance. I hope that some of the issues that you have discussed today -- and I am sure you have discussed them with many other people -- and some aspects of your message will be able to help with a solution that will ease the desperate straits you are in. I truly hope that that will take place.
Mr. Pletz: Before I leave, I should like to make some strong recommendations. I should like to recommend that all farmers be put on an accrual basis for filing their income tax. I should like to recommend that crop insurance be changed back to area average. I want to recommend that the triggers be taken off the NISA accounts. Give us free access to our own money. I recommend that the AIDA program be tossed in the garbage can and an acreage payment be done so that we farmers can get the money directly. That is about the only way that the farmers of Saskatchewan, and the majority of us are grains and oilseeds farmers, are going to survive this mess.
The Chairman: Mr. Pletz, did your farm receive any money from the government to this date?
Mr. Pletz: No. I have not accessed my NISA account for two or three years now. I should be able to access it now though. I believe I have about $10,000 in there. Crop insurance has let me down year after year after year. I am really perturbed with crop insurance because our federal government has come up with that $20,000 Canadian Wheat Board cash advance and you have to be in crop insurance to get that. I was forced out of crop insurance because I could not pay my premium bill last year, so I cannot access that. I could not access one dollar out of AIDA. I got zero out of there for 1998. I have not done my 1999 forms yet, so I am not sure if I will be able to access there or not. As I said, the AIDA program is jimmied. Even with some minor changes Mr. Vanclief has made in there, I think 70 per cent of the farmers will still not access one dollar out of AIDA because they cannot trigger it. Since there is a 70 per cent support level there, the first 30 per cent that we farmers are supposed to lose in AIDA covers up 100 per cent of our accounts payable where our losses are; that first 30 per cent eats up 100 per cent of our accounts payable and that is why we cannot trigger or access AIDA. We need a cost-of-production formula somewhere that is long term. We need a large cash injection this spring or basically we are done for.
The Chairman: There is a lot of talk about a level playing field in agriculture because we are an exporter of grains. We do have to compete with the U.S. We have to compete with the European Community. We have in Canada about 10 per cent of the grain producers equivalent to the Americans.
Canada and the culture of this country should allow an injection of capital. We cannot afford not to because the country is going to pay a big price for it down the road at a time when they will not be able to reinstate the industry. It is a sad thing that this message is not getting through.
If our grain producers were to receive the equivalent of what the Americans are injecting into their economy, would that solve the problem?
Mr. Pletz: Yes, it probably would. Historically, Canada has always done 10 per cent of what the U.S. provides, so if the U.S. has been putting in $50 billion or $60 billion per year, our government would have had to put in 10 per cent of that or $5 billion or $6 billion a year to sustain the Canadian agriculture industry.
The Chairman: Canada's agricultural exports added to the economy of Canada 25 per cent of the balance of payments that this country received. It was a significant benefit for Canada, and it seems to me that the farmers are not receiving their share of that.
Mr. Pletz: No, they are not.
The Chairman: Because our net take last year, according to the farmer's union appearing before us here, was 0.7 per cent return on investment.
Mr. Pletz: That number is wrong because our accounts payable are not deducted off that number.
The Chairman: So you think it is even in the minus?
Mr. Pletz: Yes, it is. On the accrual basis, our net numbers would be all minus for the last number of years, because our accounts payable would have kept the net numbers below zero. We have been losing money for years, in reality. There is only 20 per cent of the losses in the net numbers. All governments do not have the other 80 per cent of the real story, because it is hidden. Nobody has those numbers or accounts payable or our losses.
The Chairman: What if we in the grain industry were to receive returns on our investment and input costs equivalent to what the dairy producers, the chicken producers and the feather producers are receiving from the consumer of Canada through legislation? They do not export. They deal mainly with the amount of consumed food in Canada. Now, our industry cannot do that because we are exporting. What is the percentage that we consume?
Mr. Pletz: It is about 20 per cent, and 80 per cent is exported. What I really cannot see and justify is how both levels of government, federal and provincial, can, in essence, from my point of view, bankrupt us on purpose. We farmers generate wealth right across Canada, and we generate taxes. To take us from wealth generators and tax generators and put us on the welfare lines is a triple whammy. Where is the economic sense in that?
I have heard that we generate about $90 billion worth of wealth for Canada. Is it not just good economic sense to inject $5 billion or $10 billion a year to keep that $90 billion coming? I do not see the economic sense of bankrupting or ruining the agriculture industry in Canada.
The Chairman: As chairman of the committee, I want to clarify this by saying that I do not believe that there is an agenda of the government to bankrupt farmers. I do not believe that. However, I do believe that there is a misunderstanding in the country of the size of the problem we face. That is largely due to our culture. By comparison, for instance, the culture of Europe is very concerned with agriculture, and there many reasons for that. Maybe in Canada we have taken food for granted for too long. Maybe we just do not fully understand the importance of the spin-over that comes out of agriculture.
I want to make it clear that in my view Canadians cannot afford to close their eyes to the problem that exists particularly in the grain industry at this point in time. It will be a serious detriment to the whole economy of Canada and will have far-reaching effects if we do not do the right things -- but I believe we will; eventually we will. However, the question is how much fallout will we have before this is done?
Mr. Pletz: The fallout I see is a bankrupt Saskatchewan within a year. The chain reaction is already happening all the way back to the retailer, manufacturer, and wholesaler. Once the industry is destroyed, how do you refire it back up? It will cost billions more to get it back up on its feet, if the federal government ever cares to get it back up on its feet.
I can see us being eliminated just by lack of support, by letting us go. I can see us going from an exporting country, if you eliminate enough farmers, down to being just self-sufficient within Canada -- by doing nothing, by not supporting the farm industry. Our federal government may be just letting the whole industry level itself out, but in doing that you are destroying the majority of the industry and you are destroying thousands of farm families.
Only 1.03 per cent of the federal budget is spent on supporting agriculture. In Europe 40 to 50 per cent of the budget goes to agriculture. Those are numbers I got on the Hill in the last week.
Senator Robichaud: You said you picked up those numbers on the Hill?
Mr. Pletz: Right. I got those from Mr. Proctor's office. He is the federal NDP agriculture critic.
Senator Oliver: Mr. Chairman, I apologize for being late. As you know, I was at another meeting. However, I have heard the tail end, and it is a depressing story that the witness tells.
I agree with the chairman and others in saying that I do not believe that the government has a policy of trying to put farmers out of business. I know that you may feel badly, but I do not think that that is a government policy. On the other hand, it seems that what is required is not simply for someone to come along and give you $60,000 today, because, as you said to Senator Robichaud, that would not cure the problem. Rather, some sort of systemic restructuring of your business, of the farm industry, has to take place -- and it should have taken place yesterday.
Mr. Pletz: Right.
Senator Oliver: You have given us four things that you would like to see restructured: the accounting system going to accrual, and so on, and crop insurance going back to the area, and so on. Those are good points, but is there any other kind of restructuring that you would recommend that could take place now to add some immediate cash flow to the farmers? Have you looked at mixing the crops? Have you considered going into bison or deer farming? Have you looked at vegetable crops, using some of the land for things other than wheats and grains as a way of trying to restructure the industry in Saskatchewan?
Mr. Pletz: Yes, we have, and the majority of us have diversified. However, we can diversify until the cows come home, but until we get a cost production formula in place, it is not the answer. There are a number of people in the elk and buffalo industry, but their prices have been dropping, too, because of the fact that so many people are getting into their industry. In other words, you have a niche market, but your niche markets only last for a year or two and then they are in financial trouble. If everybody jumps into the elk or the buffalo or the vegetable side, we are still in the poor house because there is no cost production formula there.
Mind you, it is working for a few farmers. They are making dollars and they are surviving, but in my Saskatchewan Crop Planting Guide, the only crop that I can grow this year that I can make a dollar on is lentils. Every other crop loses anywhere from $30 to $80 an acre, and those numbers do not include a return of profit. They do not include the cost of living.
Senator Oliver: Why not triple the amount of lentils you are planting, then?
Mr. Pletz: Because if every farmer in Saskatchewan, or the majority, grew lentils this year, supply and demand in the marketplace would fall so far that nobody would make a dollar on them. It seems that no matter what we do it is a Catch-22 situation: we are damned, if we do, and damned, if we don't.
Senator Oliver: Just going back to this 28 or 30 per cent interest, that is not with a Canadian bank, is it?
Mr. Pletz: No, most of the banks are 10 to 12 per cent, or in that range.
Senator Oliver: Product plus 12?
Mr. Pletz: No, just 12 per cent -- 10 to 12 per cent per year. Most of them are seed, fertilizer, chemical companies. We are paying over 1 or 1.5 per cent on our arrears.
Senator Oliver: So there is no way you could refinance some of that with a debt and get 12 per cent, to save the tremendous interest charges there, is there?
Mr. Pletz: No, because we are credited out at our banks already. It would be nice, yes, if I could go to my bank and say, "Let's amalgamate all my accounts payable and have a 10 per cent rate instead 2 per cent compounded monthly.
Senator Oliver: So there is no other financial institution, like the Farm Credit Corporation, that could help?
Mr. Pletz: The Farm Credit might; I have not tried them yet, but we are still done for, senator. What I see back home is that every farmer has basically kicked into an individual survival mode, and that is where the depression and suicides are coming from.
Senator Oliver: Is there a charge against your land? Is there anything you could do by selling off a few more acres to raise immediate cash?
Mr. Pletz: There is nobody to buy it, sir. The only one who might buy it is the odd foreigner coming in. We cannot sell. The auction sales are going to be numerous, more than average, and most of the equipment being sold at those auction sales will be 10 cents on the dollar to maybe 50 cents on the dollar for some of the larger, newer equipment. It is just going to be given away.
I attended auction sales last fall where there was a $60,000 air seeder sold for $7,000 -- so 10 cents on the dollar. I cannot even leave my farm with a little pride, because if I sell all my equipment, and give it away for 10 or 20 or 30 cents on the dollar, I still cannot pay my bills, so that I could at least leave my farm with a little dignity and pay off my creditors. A lot of my creditors I know personally, like my fuel dealer, my co-op dealer, my seed supplier, and my grain buyer. I am going to have to short them all by declaring bankruptcy. That is where the anger and frustration and the hell is for everyone -- not just the farmer.
The Chairman: There is some clarification on that, however, and I am sure Mr. Pletz will agree with me. For instance, in an oil area, where you have oil and farm land, there are farmers who have made a lot of money in the oil business. They have not made any money from farming, but because they had oil rights that returned money to them. Those farmers are picking up land at the cheap rates and expanding their business, not with farm income, but with oil income.
There are probably other areas that that may happen in, in some specific areas where they have income from other sources; but they are monopolizing. This is only doing one thing, though. It is making very large farms out of the ones who can farm with oil money. Interestingly enough, they are the same people who received the AIDA money.
I can give you examples of people who got $75,000, $50,000 and $48,000, and so on, because they never diversified in years, because they had oil money coming in and they said, "Why should I change my operation?" So they just grew wheat. Just growing wheat, they had three good years of crops and then the price plummeted and so AIDA paid out. However, for the poor little guys beside them it did not pay out, because they had diversified and moved into other crops, and so on.
Senator Robichaud: Why would those farmers with oil money put money into the farm business? So they can lose it faster?
Mr. Pletz: It is a tax write-off.
Senator Oliver: They can write off their losses.
Mr. Pletz: It is a tax write-off on their oil money.
Senator Robichaud: So they are not going to seed or to have any activity, are they?
The Chairman: Oh, they will have activity, and there will be the farmers who will be buying the new tractors at $200,000.
Senator Robichaud: They do not have to buy new tractors; somebody else will be selling his for about 10 cents on the dollar; so why buy a new one?
The Chairman: They will not bother with that old, used tractor of his. They want a new, modern tractor. I would not say that that is widespread, but it is there. I just wanted to clarify that, and I would like to hear your comment on that.
Mr. Pletz: I agree with you, senator. That does happen, but those farmers are few and far between. For the farmers who have off-farm jobs, the majority of that money, if not all of it, is going to pay the losses and they still have no grocery money. I know numerous farmers back home who do not have money for groceries but keep their power and the telephone on.
I would like to comment at this time that I have numerous farmers threatening to pick up their guns and basically bear arms against the federal government. That is what is coming. Basically, our rally groups have been holding a lot of these farmers at bay, and it has got to the point where we cannot hold them at bay any more.
Senator Robichaud: I cannot see where that will produce any results. Violence breeds violence. I cannot agree with you. I would urge you to discourage your people to use that route, because it certainly will not bear any fruit.
The Chairman: I, as chairman, go along with that very important suggestion that we must not allow this violence. We must work together in an understanding way to see that that does not happen.
Mr. Pletz: We have been trying, but I am saying that, as a rally group organizer and part of a couple groups already, these farmers are no longer listening to our discouragements to not take that route. I just use that to show the desperation and the hell that people are going through. They are at the point of retaliating.
Senator Chalifoux: Mr. Pletz, I find many of your comments very interesting. I come from Northern Alberta. I just came from a Grand Prairie meeting with the Northern Alberta Development Council up there. There are a lot of farmers there. They have been in a drought situation for over three years, and they are facing another drought this year. Northern B.C. is the same. Yet what I found there is that they are not advocating more money; they are advocating restructuring the programs that are now available so that the farmers can have access to the monies that are available.
The same thing applies to Southern Manitoba. Senator Fairbairn and I sit in northern and western caucus on the government side. The farm crisis is top priority. Minister Goodale is really there fighting. We also have the rural caucus which is fighting to come to some sort of a restructuring.
Minister Vanclief and the Premiers of Saskatchewan and Manitoba came to an agreement for more money to go into the farm sector in Saskatchewan and Manitoba. I would like to know your opinion on that extra money that is coming in; if you cannot access it, why can't you?
Mr. Pletz: You mentioned restructuring programs. I gave you comments on NISA, AIDA and crop insurance. All the farm industry is calling for restructuring, but the bottom line is that the restructuring we desperately need is a cost production formula some place. My understanding of that so-called new money, or that special program that came to Saskatchewan and Manitoba, is that it was basically done using the CROW as an excuse to target it to Manitoba and Saskatchewan. The reason that that was done was that 70 or 80 per cent of us grain and oilseed farmers could not access AIDA dollars. That is why it was done.
That $1 billion that is coming to Saskatchewan is not cash; only $300 million of it is, and that is the $5 an acre I talked about, which is peanuts. About $400 million of that total is the Canadian Wheat Board cash advance, which is just another loan, which is no good because we are all credited out. You cannot solve the farm crisis with another loan. I believe there will be thousands of farmers refusing to even go and get it, for the simple fact that it does not help. It is just another loan and it puts you farther into debt. It is just another way of losing a little more equity or assets later this year.
As to the AIDA program, there are some changes there. I believe that for 1999, still for the last year, 70 per cent of us grains and oilseeds farmers will still not access one dollar out of that. The only money we will access is the $300 million out of that $1 billion, at about $5 an acre. We have lost $100 over the last two years, so what is $5?
Senator Chalifoux: Have you met with the rural caucus?
Mr. Pletz: No, I have not. Which rural caucus is that?
Senator Chalifoux: The federal government; Larry McCormick, the MP, is the chair of it. He is very concerned about this crisis.
Mr. Pletz: Could I get Mr. McCormick's phone number?
Senator Chalifoux: Yes.
Mr. Pletz: I will be here on the Hill for another week, and I would like to meet with him and a few more of the MPs and maybe Jack Wilkinson of the Ontario CFA. I have already met with Bob Friesen in the CFA and a number of other people.
Senator Chalifoux: If you can possibly meet with Reg Alcock, who is an MP from Manitoba, you will find him very knowledgeable and very good, especially on the transportation issue. There is a large transportation issue, and that was brought up in Grand Prairie as well. The transportation costs are very important to the survival of our agriculture industry. I would strongly suggest that you meet with those two people especially.
Mr. Pletz: Thank you.
The Chairman: Just as a point of interest on that, the CPR just increased its freight rates by 3 per cent.
Mr. Pletz: I met with Mr. Goodale's office last week and, although I have met and talked to so many people, I think it was through that office that I learned that they are talking about taking the Estey-Kroeger report and throwing it in the garbage can and not doing anything with the freight issue. About 30 to 40 per cent of my grain cheques go to freight. What is left does not pay my costs. That is why we need a cost production formula.
Senator Chalifoux: The northern and western caucus of the federal government have been big pushers in restructuring the Estey report. That is why I suggest that you talk to Reg.
Mr. Pletz: Right.
Senator Chalifoux: Whatever you do, do not resort to violence; it does not work.
Mr. Pletz: All I can say, senators, is that, between the financial hurt and seeing your neighbour commit suicide and leave his home behind, and his wife and kids, that is what is escalating the crisis.
The Chairman: Thank you, Mr. Pletz, for a very sincere and touching description of the desperate situation that you have presented here before the Senate committee this morning. I want to commend you for the work you do, for the sincerity that you carry in this difficult time. I wish you well along with the other farmers.
This has been a good committee, one that has had an ear for attuned to the hurt that is out there, and I commend the senators for their loyalty in trying to help the government come to grips with the serious situation that we face, particularly in the grain industry.
Thank you again, Mr. Pletz. I want to encourage you and at the same time suggest, as other senators have indicated, that, whatever you do, you do not resort to violence, because that would only compound what is already a very serious problem. Thank you for appearing this morning.
Mr. Pletz: Thank you for having me.
The committee adjourned.