47 



Again, I congratulate you on your appointment and I look for- 

 ward to working with you. 



Thank you. 



Secretary Espy. Thank you. I appreciate those comments and I 

 accept your invitation to come and see your district. Let's find a 

 good date to do it. 



The Chairman. Mr. Penny. 



Mr. Penny. Thank you, Mr. Chairman. 



I want to take this opportunity to officially congratulate you on 

 your appointment and to wish you the very best. 



I have noted in the last few weeks that you have repeatedly 

 made reference to your desire to reorganize and restructure the De- 

 partment and want to make an offer to you that you have at least 

 one very strong and willing ally on the committee as you start 

 down that path. I think it is an undertaking that certainly poses 

 great challenges but we can do a lot more for agriculture if we get 

 our own house in order. 



I applaud your commitment to that goal. 



I want to be a bit more parochial, in terms of a couple of pro- 

 grams in which I have a direct interest. In the 1990 farm bill we 

 created the Ag Research Commercialization Program. As we talk 

 about rural development, new uses for farm crops is certainly a di- 

 rection we need to pursue. I urge your close attention to that and 

 would like to see you make that one of President Clinton's invest- 

 ment priorities. 



The second area is the beginning farmer bill, which we passed as 

 part of a major Farm Credit Act last year, which will take some of 

 the existing money at Farmers Home and dedicate it to down pay- 

 ment, loan assistance, and other help for beginning farmers. I 

 think a very ambitious attitude on the part of the Department of 

 Agriculture will be critical if we're going to make that program 

 work out there in farm country. 



And last but not least, I chair the Foreign Agriculture Subcom- 

 mittee and value-added exports are where it is at. Your attention 

 to that as a priority for our farm producers in the next several 

 years I think will pay tremendous dividends. 



Any reactions you might have? I just wanted to share those view- 

 points with you. 



Secretary Espy. I agree with you on all three counts. When it 

 comes to value-added exports, the statistics reflect that they have 

 now exceeded bulk products when it comes to the balance of trade 

 item. That is the wave of the future and that is how it looks. It 

 looks good. We will continue to emphasize that, Mr. Penny. 



Also, we do have a problem when it comes to our GSM Program 

 and the integrity of these programs with regard to the extension of 

 credit to the former Soviet Union and the now-CIS States. We 

 have a real problem there. As you know, we will be meeting soon 

 and talking with them about restructuring, if possible, and where 

 we go. We in the Department have now received claims by certain 

 banks that have extended funds to these new democracies under 

 our Credit Guarantee Program. It is a big problem. 



We have to move with all deliberate speed to try to make sure 

 that we can have a viable program, one that promotes these new 

 democracies, but also one that has integrity where we are able to 



