FarmPolicy

June 28, 2017

Awkwardly, The 2008 Farm Bill Debate Wraps Up

Farm Bill

Mike Soraghan reported yesterday at The Hill Online that, “A clerical error caused widespread confusion on Capitol Hill Thursday, stealing the spotlight from Democrats hoping to tout the second veto override of President Bush’s reign.

“Democrats in the House and Senate won enough votes to override Bush’s veto, but one of the farm bill’s 15 titles was omitted from the official ‘parchment’ copy sent to the White House.”

The Hill article added that, “Democratic leaders said the veto and the subsequent override by both chambers are still valid, and that most provisions of the bill are now law. They also noted that Bush mentioned the missing section — Title III on trade — in his veto message, suggesting he intended to veto that part of the bill.

“The White House on Thursday repeated its opposition to the bill and chided Congress for its mistake.”

Mr. Soraghan explained that, “House Democrats on Thursday quickly passed a second, full version of the 1,768-page bill on the House floor, again by a veto-proof 306-110 count. The Senate, however, did not take up the House-passed bill. Instead, it simply completed the override.

“Senators indicated all that needs to be done is to pass the missing title, but House plans to vote on a stand-alone bill containing that language were scuttled after angry Republican leaders lined up against it.

“House Republican leaders, including those who supported the bill, complained that the measure is more vulnerable to lawsuits because of the error unless a whole new version is devised. They also complained that Democrats were not aboveboard in how they handled it.”

The Hill article noted that, “‘Fourteen of 15 titles in this farm bill are now law,’ said Senate Agriculture Committee Chairman Tom Harkin (D-Iowa). Of that remaining title, he said, ‘We’ll deal with that at some other point. It shouldn’t be much of a problem.’

“Sen. Saxby Chambliss (R-Ga.), the top Republican on the panel, was less sanguine, reflecting the concerns of his party over the omission.

“‘Over the next few days, hopefully, the waters will smooth out,’ Chambliss said. ‘We may have to take up the whole bill.’”

A press release issued yesterday by the House Ag Committee stated that, “House Agriculture Committee Chairman Collin Peterson of Minnesota and Ranking Member Bob Goodlatte of Virginia issued the following statement today:

“‘Following veto override votes of 316-108 in the House and 82-13 in the Senate, the Food, Conservation and Energy Act of 2008 has been enacted into law, with the exception of the bill’s trade title.

“‘The trade title was included in the conference report passed by Congress but was inadvertently left out of the official copy of the farm bill that the President vetoed. Today, the House also took action to correct the clerical error that resulted in the unintentional omission of the trade title from the enrolled farm bill and ensure that the entire farm bill is enacted into law swiftly. Most of the farm bill is now law and the Administration can begin implementing the new programs and policies immediately.’”

Meanwhile, the White House Press Office issued a “Fact Sheet” on the Farm Bill yesterday, which noted in part that, “For a year and a half, the Administration has consistently asked that the Congress pass a good farm bill that is fiscally responsible and better targets support programs. The Congress is now preparing to reconsider at least a portion of the farm bill and should take this opportunity to address the objections that have been raised repeatedly and the most recently raised concerns related to the Average Crop Revenue Election (ACRE) program.”

The executive branch item stated that, “Following passage of this legislation, it has become clear that a newly designed subsidy program, which is uncapped, could result in billions of dollars being made available to subsidize crops, locking in historically high price levels. The amount of the subsidy is tied to recent record prices. If prices drop even 10 percent from these levels, the new program could increase taxpayer-financed payments to farmers by billions of dollars, despite still profitable crop prices. This provision is grossly inconsistent with the Administration’s proposals for reform of subsidy payments.”

Greg Hitt reported in today’s Wall Street Journal that, “A wide bipartisan majority of the Senate voted Thursday to override President Bush’s veto of the farm bill, amid discord over how the legislation was handled in the House.

“The 82 to 13 vote in the Senate underscored the eagerness of lawmakers to notch election-year accomplishments, at a time when voters are dissatisfied with the direction of the country and with politicians of all stripes.”

Mr. Hitt indicated that, “The Senate action, which followed the House’s 316-108 vote Wednesday to override, ensures the farm bill is ‘now the law of the land,’ said Senate Agriculture Chairman Tom Harkin (D., Iowa). The veto override was only the second of Mr. Bush’s presidency.

“But in the rush to act, Mr. Harkin and other lawmakers left one piece of the farm bill still wanting enactment. That’s because a single title — a few dozen pages dealing with trade and international food-assistance programs — was missing from the more than 1,700-page bill when it was sent to the White House for Mr. Bush’s consideration.

“White House press secretary Dana Perino suggested the ‘technical error’ could give lawmakers a last chance to address Mr. Bush’s concerns with the bill.”

Jonathan Weisman reported in today’s Washington Post that, “With an overwhelming 82 to 13 vote, the Senate yesterday completed the override of President Bush’s veto of a comprehensive farm bill, shrugging off Republican concerns about an embarrassing legislative glitch to make the $307 billion bill the law of the land.

“House GOP leaders continued to grumble that Democrats had violated the Constitution by pressing forward with the veto override after they discovered that a whole section of the bill on trade policy had been inadvertently dropped from the version vetoed Wednesday.

“But Democratic leaders said they had court precedent and constitutional scholars on their side. ‘The veto override will have the force of law,’ said House Speaker Nancy Pelosi (D-Calif.).”

The Post article added that, “House Democratic leaders did push the entire farm bill back through the House again yesterday, in case they decide to start the process over again. But that appeared doubtful after the Senate’s action.

“Citing the Supreme Court’s 192 decision in Field v. Clark, House parliamentarian John Sullivan released a statement yesterday saying that ‘the law that would result from a bicameral override of the President’s veto on H.R. 2419 would be the text that was presented to the President on parchment, notwithstanding its omission of the congressionally intended [trade] title.’”

David Rogers reported yesterday at Politico.com that, “Covering trade and some international nutrition programs, the title is a small part of the spending picture, about $1.62 billion from 2008 to 2012. But the whole episode has been a huge embarrassment for the Democratic leadership, which had labored hard to get a Farm Bill and hoped to be celebrating an unblemished victory over Bush before Memorial Day.”

David Stout reported in today’s New York Times that, “Those Republicans who stood with the president in opposing the bill clearly enjoyed the awkwardness of the moment and the contortions of the bill’s supporters in trying to set things right. Representative John A. Boehner of Ohio, the House minority leader, expressed indignation, saying Democratic leaders had pushed the bill through on Wednesday night even after learning that it was flawed.

“Mr. Boehner happily offered a reminder that in 2006, Representative Nancy Pelosi of California, then the minority leader, demanded an ethics investigation after the Republican leadership allowed the House to vote on a measure that included incorrect numbers mistakenly inserted.

“In the Senate, where the vote Thursday was on an override of the veto of the original, flawed bill, Senator Harry Reid of Nevada, the Democratic majority leader, said he saw no need to worry about the missing section. If necessary, he said, the Senate will approve it separately when Congress returns in June from a week’s vacation.”

Associated Press writer Mary Clare Jalonick reported yesterday that, “‘It seems that the congressional debate on the pork-laden farm bill is coming to an inglorious conclusion,’ White House spokesman Scott Stanzel said.”

And the “Washington Insider” section of DTN noted yesterday (link requires subscription) that, “So, it now appears certain that the 2008 farm bill debate is over — while the battles over energy policy and its implementation, over trade policy, market regulations and food prices are just beginning.”

Food Prices

The UN Food and Agriculture Organization (FAO) noted in a press release from yesterday that, “The latest Food Outlook indicates that the food import bill of the Low Income Food Deficit Countries (LIFDCs) is expected to reach US$169 billion in 2008, 40 percent more than in 2007. FAO calls the sustained rise in imported food expenditures for vulnerable country groups ‘a worrying development,’ and says that by the end of 2008 their annual food import basket could cost four times as much as it did in 2000.

“International prices of most agricultural commodities have started to decline, but they are unlikely to return to the low price levels of previous years, Food Outlook reports. The FAO food price index has remained stable since February 2008, but the average of the first four months of 2008 is still 53 percent higher when compared to the same period a year ago.”

And Reuters writers Robin Pomeroy and Brian Love reported yesterday that, “In a 10-year look-ahead at likely food price scenarios, to be published next week, the FAO and the Organization for Economic Co-operation and Development saw no return to pre-crisis levels.

“‘On average over the coming 10-year period, nominal prices for cereals, rice and oilseeds are expected to be 35 percent to 65 percent higher than on average in the past 10 years,’ said a summary of the Agricultural Outlook report seen by Reuters.

“‘Prices in real terms are projected to be 10 percent to 35 percent higher than in the past decade.’

“Even a bumper harvest expected this year will do little to ease the plight of the world’s poor, FAO said in its twice-yearly Food Outlook which gives short-term estimates.”

The article noted that, “Good weather and increased plantings will provide a 3.8 percent rise in world cereal output, with wheat up 8.7 percent. That has meant the price surge has started to level off, but prices will not plummet back to pre-crisis levels, FAO said.

“Rice, a staple for more than half the earth’s population, will remain in short supply on global markets, and poor countries that rely on food imports could see food bills up 40 percent this year after a similar price hike in 2007, its report said.”

With respect to rice, Keith Bradsher and Andrew Martin reported in today’s New York Times that, “Japan is preparing to send at least 220,000 tons of rice to the Philippines, and possibly Africa. The Japanese government says the plan is meant to ease the suffering of poor nations punished by rising rice prices.

“But critics, including some in Washington, worry that it could set a precedent for Japan to dump foreign rice it was obligated to import but had never wanted. They say that the Japanese plan risks setting off a trade dispute with the United States — and may barely dent the price of rice.

“Yet opposing the Japanese plan could put the United States in a delicate diplomatic position. The price of rice, the most important staple food of the world’s poor, has risen faster than any other cereal, nearly tripling this year alone, according to rice traders. The high prices have caused protests in many countries and, according to World Bank officials, pushed 100 million people back into poverty.”

The Times article explained that, “The plan is controversial among trade experts because the rice earmarked for shipment is rice that Japan reluctantly imported from other countries under an agreement to provide at least a minimum level of access to its largely protected rice market each year.

“Separately, experts in international development warn that shipments of free or subsidized food hurt farmers in developing countries, robbing them of their customer base and making the country dependent on foreign food.

“The United States led an international effort by rice-exporting nations in the 1980s and early 1990s to insist that Japan begin allowing rice imports. Japan finally agreed to buy nearly 700,000 tons a year, as part of the 1993 global pact that created the World Trade Organization.

“But Japan has put much of the imported rice in warehouses at an annual cost to the government of $144 million, according to the United States Department of Agriculture.”

Bradsher and Martin indicated that, “A draft text for the slow-moving Doha Round of global trade talks would ban countries from exporting free food if it displaced commercial purchases.

“Selling the imported rice instead of donating it would address the food aid issue, and might comply with the letter of Japan’s pledges to the W.T.O.

“South Korea and Taiwan have both accepted deals under W.T.O. auspices that require them to allow some rice imports and explicitly bar them from re-exporting the rice. But the text of Japan’s agreement to allow minimum access to imported rice does not mention the prohibition on re-exports.

“Lawyers at the W.T.O.’s headquarters have been arguing strenuously this week over whether Japan can re-export rice, and have not come to a consensus. The W.T.O. declined to comment on the Japanese plan.”

Trade

In an item posted yesterday at the International Herald Tribune, European Union Trade Commissioner Peter Mandelson stated that, “The food crisis has reinforced two things about the future of agricultural trade.

“The first is that a growing world population, higher incomes and changes in diet are pushing up global demand for food faster than farmers can supply it. The second is that throwing up new barriers to farm trade on this crowded planet is not the way to fix this.”

Commissioner Mandelson added that, “Already some politicians in Europe and elsewhere are invoking ‘food security’ as an argument for higher farm tariffs and protected agricultural markets. Some are suggesting we should dust off the sort of trade-distorting farm subsidies that Europe abandoned in its successful CAP reforms of 2003. They even suggest that other economies should do the same. Such arguments are worrying and wrong.

“In the global age, food security can only make sense at a global level. Europe’s CAP reforms recognize this.”

In concluding his opinion item, Commissioner Mandelson stated that, “Like many crises, the food crisis is a political opportunity. The question is: for what? It can spur the developed and developing worlds into greater investment in agricultural productivity and reform of global farm trade through the Doha Round. Or it can be a pretext for a damaging retreat into agricultural protectionism. Either way, for good or ill, it will be the poorest who reap what we sow.”

Dow Jones writer Rachel Pannett reported today that, “Australian Trade Minister Simon Crean said Friday a decision by U.S. President George Bush to veto a bill giving increased support to U.S. farmers augurs well for the Doha Round of world trade talks, despite the veto being overridden by Congress.

“‘I’m pleased by the president’s commitment to the cause of liberalization. Through his veto he has clearly signaled that he wants to keep the pressure on global reform, which augurs well for Doha,’ Crean said in a statement.”

The article added that, “Australian Agriculture Minister Tony Burke described it as a ‘missed opportunity by Congress to reform U.S. agricultural policies, particularly given the current high crop prices and good producer returns.’”

Keith Good

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