Tom Harkin: “my amendment would do two things. First of all, it strikes section 505. What is section 505? Section 505--believe it or…”

“my amendment would do two things. First of all, it strikes section 505. What is section 505? Section 505--believe it or not, I know this is going to come as a shock to you, Mr. President, and others who may not have been privy to what is in this so-called farm bill--section 505 raises interest rates that the Commodity Credit Corporation charges farmers. Under current law, the USDA charges farmers interest on commodity loans at a rate based on the costs of money to the CCC, the Commodity Credit Corporation. It is a Treasury-based rate. This is the way it always has been. But the bill and the Leahy-Lugar or Lugar-Leahy amendment would increase the interest rate on commodity loans by 100 basis points above the rate, as calculated under the formula in effect on October 1, 1989. There is simply no justification for hiking the interest on farmers above a level representing the cost of funds to USDA. This bill, as drafted, would constitute usury against farmers. It is unreasonable. Here we have the Fed finally, I think, coming to its senses, I hope, in starting to reduce interest rates. They never should have hiked them in the first place over the last couple of years. Yet, on the other hand, we are going to charge more interest to farmers. I wonder how many farmers know that. I wonder how many farmers know that in this bill their interest charges are going to go up 100 basis points, for no reason. There is no reason for it.”