FarmPolicy

July 31, 2014

Climate Legislation; Secretary Vilsack in Des Moines; and the Ag Economy

Climate Legislation

Lisa Lerer reported yesterday at Politico.com that, “A major Senate climate change bill is written and ready to be debated before the Environment and Public Works committee, the chairwoman of the panel said Tuesday.

“Sen. Barbara Boxer’s legislation would distribution of tens of billions of dollars of pollution allowances to power plants, manufacturing, and other industries. It will mirror cap and trade legislation passed by the House in late June with, she noted, ‘a few tweaks.’

“The legislation has been sent to the Environmental Protection Agency for analysis, which should be completed by the end of the month.”

The Politico article stated that, “Senate Finance Committee Chairman Max Baucus, however, also plans to draft legislation dealing with the pollution allowances.

“‘My position is that’s great, he should do that as well,’ said Boxer. ‘At the end of the day this should be a collaborative process.’”

And with respect to timing, yesterday’s article indicated that, “Boxer is planning three days of hearings, kicking-off on October 27, with Energy Secretary Steven Chu, Transportation Secretary Ray LaHood, EPA administrator Lisa Jackson, and Interior Secretary Ken Salazar all expected to testify.

Boxer expects to mark-up the legislation in early November. A final bill will then be complied by Senate Majority Leader Harry Reid with input from five other committees.”

Reuters writer Richard Cowan reported yesterday that, “Democratic U.S. senators pushing legislation on global warming said on Tuesday they were making progress in winning support for the controversial measure, which is expected to begin moving through a key Senate committee sometime in November.

“‘We will make our best effort and we will advance this ball and Copenhagen will know we’re not fooling around,’ Senate Foreign Relations Committee Chairman John Kerry told Reuters in an interview.”

And Jessica Brady reported yesterday at Roll Call that, “The Senate’s climate change measure, introduced Sept. 30 by Boxer and Foreign Relations Chairman John Kerry (DMass.), has so far received a tepid response among their Democratic colleagues, especially those hailing from the Midwest and coal-rich states. Boxer said Tuesday that she has been working with Democratic Sens. Robert Byrd (W.Va.), Mark Warner (Va.), Bob Casey (Pa.), Max Baucus (Mont.) and Tom Carper (Del.) to accommodate those concerns, but noted those negotiations would not slow the bill’s progress in the Senate.”

The Roll Call article added that, “Boxer did not indicate when the legislation — a top priority for Democrats that has been overshadowed by health care reform — would appear on the Senate floor.

“‘This is a decision that will be made by Sen. Reid. He’s very encouraging to us,’ Boxer said. ‘This is his decision. I certainly hope to do it by the end of the year.’”

However, in a press briefing with reporters yesterday, Iowa GOP Senator Chuck Grassley had the following exchange with respect to Senate timing on a climate bill:

“QUESTION: Good morning, Senator. There are some that are calling on the administration to get a bit more involved in climate change legislation. What do you think that’ll do for chances of climate change legislation finally coming to a vote? Whether or not it will cause it or help it to pass?

“GRASSLEY: Well, I don’t think it’s going to come to a vote this year. So whatever efforts the president is going to make in that direction, he might as well wait until January of next year to promote it because I think we’re going to spend the rest of this year on health care reform and maybe on some tax legislation, but I don’t think cap-and-trade is going to come up — global warming stuff is going to come up.

“So I think that, from the standpoint of agricultural interests, you’ll find most people in agriculture are going to find global warming legislation to be very detrimental and very costly to farming because it puts a tax on energy, and farming is very tax — very energy — it just takes a lot of energy to farm.

“And so, consequently, you know, it’s — it’s not looked upon very positively. And another thing, you know, if it doesn’t include China and India, our own Democrat director of EPA says it’s not going to reduce the problems of global warming.”

Meanwhile, the Senate Foreign Relations Committee, which is chaired by John Kerry (D-Mass.), will be holding a hearing tomorrow on climate change issues entitled, “Drought, Flooding and Refugees: Addressing the Impacts of Climate Change in the World’s Most Vulnerable Nations.”

And today, the Senate Energy and Natural Resources Committee will be holding a hearing “to receive testimony on energy and related economic effects of global climate change legislation.”

Darren Samuelsohn of ClimateWire reported yesterday at The New York Times Online that, “Sen. Lindsey Graham spent his summer testing out lines on global warming.

“As the Republican hit the town halls in South Carolina, a state with a major military presence and one of the country’s highest unemployment rates, Graham would ask people if they thought climate change was a problem.

Few did.

But Graham quickly followed with another question, asking for a show of hands from those concerned about energy security. The response was strong, and Graham wasted little time making the connection.”

The ClimateWire article explained that, “Graham’s desire to trade energy provisions for his support on a major climate bill has won him audiences with leading Senate Democrats and the Obama administration. And while few of his fellow Republicans are willing to make such a leap, Graham is.

“And that is why he landed Sunday on a very public stage — The New York Times op-ed page — publishing an article about possible legislative compromises with Sen. John Kerry, the Massachusetts Democrat who has taken his party’s lead in negotiations on the climate bill.”

Jim Snyder reported yesterday at The Hill Online that, “The pairing of Democrat John Kerry and Republican Lindsey Graham on global warming, even if only to pen an op-ed column and not actual legislation, is a step forward for the climate bill.

“Just how big of one and how many more steps there are before a bill becomes law is the subject of debate.”

While Senator Graham’s impact on the climate debate unfolds, Brad Johnson noted yesterday at The Wonk Room Blog (Center for American Progress Action Fund) that Sen. Graham’s overture on climate legislation has not been popular with everyone.

With respect to the substance of the Kerry-Boxer bill, an update posted yesterday at the National Journal’s Energy and Environment Blog provided the perspective on the legislation from seven experts, to view this interesting discussion, just click here.

Rep. Frank Lucas (R-Oklahoma), the Ranking Member of the House Ag Committee, noted in a release yesterday that, “”Recently, Senator Barbara Boxer from California and Senator John Kerry from Massachusetts unveiled the Senate version of the cap and tax bill.

“This legislation seems to be just as bad if not worse than the House version –the Waxman-Markey cap and tax bill.

“Both bills would significantly increase energy and other input costs for our farmers and ranchers, which will put our farmers and ranchers at a competitive disadvantage in international markets.”

And, in a letter to the editor published in today’s Wall Street Journal, Charlotte Hebebrand, president of the International Food and Agricultural Trade Policy Council, noted that, “Regarding New Zealand’s proposal to lower agricultural greenhouse gas emissions without jeopardizing food security (‘Cutting Carbon, Feeding the World,’ op-ed, Oct. 6):

“This global challenge must be addressed by innovation and collaboration across political borders. We have the knowledge and tools to act today. The single most important undertaking is to increase agricultural productivity on existing arable and degraded land to ensure a sustained decrease in deforestation, which is responsible for 20% of greenhouse-gas emissions.

“While reducing agricultural energy intensity is desirable, it is important to keep in mind that for some countries, an intensification of agriculture may be more appropriate. Many developing country agricultural producers, in particular in Africa, see lower yields due to insufficient inputs, including modern farming equipment and fertilizer. Low productivity and poor soil health, if left unchanged, could lead to increased rates of deforestation, and therefore exacerbate rather than mitigate climate change.”

Jim Tankersley and Alexander C. Hart reported in today’s Los Angeles Times that, “The Environmental Protection Agency on Tuesday released a long-suppressed report by George W. Bush administration officials who had concluded — based on science — that the government should begin regulating greenhouse gas emissions because global warming posed serious risks to the country.

“The report, known as an ‘endangerment finding,’ was done in 2007. The Bush White House refused to make it public because it opposed new government efforts to regulate the gases most scientists see as the major cause of global warming.

“The existence of the finding — and the refusal of the Bush administration to make it public — were already known. But no copy of the document had been released until Tuesday.”

Secretary Vilsack in Des Moines

Associated Press writer Mike Glover reported yesterday that, “Agriculture Secretary Tom Vilsack returned to Iowa on Tuesday to promote locally grown food and urge that states be given a key role in tighter regulation of the financial services industry.

“Vilsack, the state’s governor for eight years, spoke Tuesday morning at a food security conference, saying his agency supported local food production that keeps consumers closer to the food supply.

“He noted big increases in the number of farmers markets nationwide and said expansion of the food industry could help the U.S. economy by increasing spending and creating jobs.”

Kathie Obradovich reported yesterday at The Iowa Politics Blog (The Des Moines Register) that, “U.S. Agriculture Secretary Tom Vilsack, speaking this morning to the Community Food Security Coalition conference in Des Moines, spent just over 30 minutes extolling community and organic food efforts to an appreciative audience of advocates.

“Then he was asked what he’s doing to address the continued consolidation and mechanization of traditional agriculture. The questioner suggested USDA can’t be fully committed to helping small, sustainable operations compete unless it’s willing to put some curbs on conventional agriculture.

There was a little grumbling in the audience when Vilsack refused to choose small, local farms over larger, conventional operations. ‘I have two sons and I love them both. And your question sort of, kind of asks, ‘Which son do you love the most?’”

Yesterday’s update added that, “Production agriculture produces 75 percent of the food and fiber in this country, he said. ‘That’s not likely to change — in the short term,’ he said. ‘So we create opportunities for smaller (farms) to become mid-sized and for mid-sized folks to stay in business. We create more transparency and better marketing opportunities, through some livestock regulations we’re looking at, to make sure that the small producer has a fair break, a fair shake.’

The grumbling turned into a few outright boos when he refused to rule out genetically modified crops, raising the need for technology to feed the expanding world population. ‘I’m telling you what people are telling me,’ Vilsack said. He said USDA’s focus is on a transparent, fair regulatory system for GMOs.”

DTN Ag Policy Editor Chris Clayton reported yesterday (link requires subscription) that, “Secretary of Agriculture Tom Vilsack found himself walking a tightrope Tuesday as he addressed a group of community food activists who on the one hand praise USDA for some recent initiatives to promote local foods, but on the other criticize the department for its support of production agriculture.”

Mr. Clayton noted that, “Vilsack’s speech and the questions afterward highlight some of the challenges about the dual direction of USDA as the Obama administration works to promote organic gardens, farmer markets and local cooperatives while touting the need to expand trade and help promote biotechnology overseas as a way to increase food security.”

Yesterday’s DTN article stated that, “Jerry Smith, a critic of biotech crops, cited studies he claimed challenged the benefits of genetically-modified crops and foods. Smith said his friends assured him that Vilsack ‘had an open mind and was forward thinking.’ Thus, Smith asked if Vilsack is willing to consider the evidence of ‘how GMOs have failed us’ and put biotech crops ‘back into the laboratory.’ Smith’s statement got a roaring round of applause from the audience.

“Vilsack told the crowd that there are lots of studies on biotech crops and they are ‘conflicting’ on benefits versus negatives. USDA is working on regulations for introduction of biotech crops, and the department has brought in backers and opponents of biotech crops. USDA is trying to develop a ‘regulatory structure that creates enough protections and assurances,’ he said.”

Mr. Clayton indicated that, “The exchange, though, also highlighted questions raised by supporters of production agriculture. Speaking last week to the American Enterprise Institute, Sen. Mike Johanns, R-Neb., a Bush administration secretary of agriculture, specifically questioned the administration’s commitment to production agriculture as USDA goes down the dual path of touting local and organic food.

“‘There seems to be, from the current administration, an idyllic vision of the countryside, without much of a realistic understanding of how modern-day agriculture feeds an ever-growing world population,’ Johanns stated in his speech last week. ‘I would suggest to you this morning that in the face of these and other challenges, we must stand strong in support of traditional agriculture and policies based on sound science.’”

Dan Looker provided this summary yesterday at Agriculture Online: “Speaking to a group of food activists in Des Moines, Tuesday, Agriculture Secretary Tom Vilsack got a standing ovation after describing the Obama administration’s efforts to promote farmers markets and expand locally-grown foods into schools, hospitals and other government institutions. But when he refused to agree with a questioner that genetically modified organisms (GMOs) are ineffective and dangerous, he was greeted by a smattering of boos.”

Ag Economy

Hal Weitzman reported yesterday at the Financial Times Online that, “Cargill, the US agribusiness conglomerate, on Tuesday warned that the global economy was ‘still fragile’ as it said profits in the three months to the end of August had plunged by 65 per cent from last year, dragged down by poor fertiliser sales.

The results underline how the US agricultural sector continues to struggle as the drop in commodity prices and tighter credit markets force farmers around the world to cut demand for inputs such as fertilisers. Cargill is the world’s largest trader of agricultural commodities.

“Cargill said net income in its fiscal first quarter was $525m (£330m), down from a record $1.49bn in the period a year ago. However, Greg Page, Cargill’s chairman and chief executive, suggested that the company might have turned a corner from the previous two quarters, which prompted its full-year earnings for the last fiscal year to fall for the first time in eight years.”

Keith Good

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