January 25, 2020

Farm Bill; Federal Debt; Legislative Agenda- Climate Issues; Crop Insurance; Nutrition Programs; and USDA Nomination

Farm Bill

DTN Political Correspondent Jerry Hagstrom reported yesterday (link requires subscription) that, “House Agriculture Committee Chairman Collin Peterson, D-Minn., said he plans to begin hearings on the 2012 farm bill in March or April of this year and that he is determined to write a bipartisan bill that is within the funding baseline that exists in 2012.

“The funding baseline is the amount of money that the Congressional Budget Office determines would be spent on all programs in the farm bill if the same programs were to continue after 2012. CBO projects the funding levels based on spending in programs in past years.

Peterson said at least initially he expects each major farm bill section — the farm program, conservation and nutrition — to stay within its 2012 baseline.”

Mr. Hagstrom added that, “Peterson told a joint meeting of the National Association of Wheat Growers and U.S. Wheat Associates, a trade promotion group, on Monday that he does not want to go to other committees to seek additional funding as he did in 2008 because ‘it’s an uphill battle to work with people who have no understanding of agriculture.’”

Yesterday’s DTN article indicated that, “Reuters reported that the future of the $5 billion per year direct payment subsidy for farmers will be part of the debate. Karl Scronce, president of the National Association of Wheat Growers, asked Peterson if the direct payment would survive in the 2012 law.

“‘These are things we need to talk through,’ responded Peterson. He said reformers were likely to attack the direct payment, a guaranteed annual payment created in 1996 and based on a farm’s past production of grains, cotton and soybeans. If farm groups back the subsidy as the best method for providing support, ‘I’ll be there’ to fight for it, said Peterson.”

Federal Debt

Meanwhile, Jackie Calmes reported in today’s New York Times that, “President Obama will call for a three-year freeze in spending on many domestic programs, and for increases no greater than inflation after that, an initiative intended to signal his seriousness about cutting the budget deficit, administration officials said Monday.

“The officials said the proposal would be a major component both of Mr. Obama’s State of the Union address on Wednesday and of the budget he will send to Congress on Monday for the fiscal year that begins in October.

The freeze would cover the agencies and programs for which Congress allocates specific budgets each year, including air traffic control, farm subsidies, education, nutrition and national parks.”

The Times article explained that, “Fiscally conservative Democrats in the House and Senate have urged Mr. Obama to support a freeze, and it would suggest to voters, Wall Street and other nations that the president is willing to make tough decisions at a time when the deficit and the national debt, in the view of many economists, have reached levels that undermine the nation’s long-term prosperity. Perceptions that government spending is out of control have contributed to Mr. Obama’s loss of support among independent voters, and concern about the government’s fiscal health could put upward pressure on the interest rates the United States has to pay to borrow money from investors and nations, especially China, that have been financing Washington’s budget deficit.”

Today’s article pointed out that, “The administration officials did not identify which programs Mr. Obama would cut or eliminate, but said that information would be in the budget he submits next week. For the coming fiscal year, the reductions would be $10 billion to $15 billion, they said. Last year Mr. Obama proposed to cut a similar amount — $11.5 billion — and Congress approved about three-fifths of that, the officials said.”

Lori Montgomery reported in today’s Washington Post that, “Although the freeze would shave no more than $15 billion off next year’s budget — barely denting a deficit projected to exceed $1 trillion for the third year in a row — White House officials said it could save significantly more during the next decade. They described the freeze as a critical component of a broader deficit-reduction campaign intended to restore confidence in Obama’s ability to control the excesses of Washington and the most lavish aspirations of his own administration.”

Ms. Montgomery noted that, “Administration officials said Obama would not freeze spending across the board but would increase investments in some agencies while slashing others. For example, Democrats are eager to offer additional help to a struggling middle class.

“Administration officials have said that goal would not conflict with deficit-reduction efforts. But the tension between them was on display Monday as Obama rolled out a list of relatively inexpensive initiatives to help middle-class families. Most of them were included in the budget he sent to Congress last year but were never funded, according to Democratic congressional aides.”

In other developments on the federal debt issue, Jackie Calmes reported yesterday at The New York Times Online that, “Just as President Obama and Congressional Democrats are trying to create a bipartisan commission on reducing the debt, some well-known former elected officials and veterans of past administrations are announcing their own task force on Monday, underscoring the mounting concern over the nation’s fiscal future.

“The timing of the group’s formation is coincidental, organizers said. Yet the outside group, including prominent Democrats and Republicans, could provide pressure and political cover for the parallel effort by the administration and Congressional leaders to consider both unpopular spending cuts and tax increases.”

Meanwhile, Walter Alarkon reported yesterday at The Hill Online that, “The Senate is expected on Tuesday to reject an amendment creating a fiscal commission that would recommend deficit-cutting measures Congress would have to vote on.

The vote would prompt President Barack Obama and centrist Democrats to turn to their backup plan of creating a commission by executive order, a move that could be announced by the president as early as Wednesday in his State of the Union address.”

Legislative Agenda – Climate Issues

Beyond a renewed focus on the federal debt, the legislative agenda also appears to be turning to the economy and job creation.

Silla Brush reported yesterday at The Hill Online that, “Senate Democrats are considering a jobs bill in the range of $80 billion.

“The package is subject to change, but a draft summary of proposals under discussion includes small business credits, tens of billions of dollars in infrastructure spending, energy efficiency programs, money to hire police and firefighters and billions to boost lending to small businesses.”

And Katherine Ling of Greenwire reported yesterday at The New York Times Online that, “A Senate Environment and Public Works subcommittee this week will highlight solar energy and clean energy job opportunities as President Obama and Democrats continue to work on economic recovery and job creation.

“Obama appeared at Lorain County Community College in Ohio on Friday to urge Congress to pass legislation that includes incentives for training in clean energy such as making solar panels and windmill blades. Obama watched formerly laid-off workers weld and shape components for wind turbines as they work toward a certificate or associate’s degree.”

Yesterday’s article noted that, “[Sen. Bernie Sanders (I-Vt.), chairman of the Green Jobs and New Economy Subcommittee] is not alone in his call for more funding for solar incentives, particularly in any jobs package the Senate is developing. The House passed a jobs bill in December that included incentives for energy efficiency but not other alternative energy.”

The focus on jobs is also increasingly seeping into the debate over climate legislation.

Darren Goode and Amy Harder reported yesterday at the National Journal’s Energy and Environment Blog that, “Democratic leaders’ efforts this year to get broad climate and energy legislation passed will largely hinge on whether they can convince moderates in both parties that it would create jobs.

“The Senate Environment and Public Works Committee will hold another in a series of hearings this week to try to further that argument. Thursday’s hearing stars Interior Secretary Ken Salazar and focuses on jobs that could be created through expanding the use of solar energy.”

Yesterday’s update pointed out that, “Democratic leaders have a tough climb toward 60 votes for a bill like the one passed in the committee last year that calls for an economy-wide cap-and-trade program. It is unclear how persuasive Thursday’s hearing will be with a panel that — other than Senate Finance Chairman Max Baucus, D-Mont. — does not have a strong representation of moderates in either party.

“At the same time, Senate Energy and Natural Resources ranking member Lisa Murkowski, R-Alaska, and Senate Agriculture Chairwoman Blanche Lincoln, D-Ark., are leading an effort to try to pass a resolution blocking EPA from regulating greenhouse gases. There is some fear this effort could undermine the attempt to pass broad climate legislation by this spring, as both Murkowski and Lincoln have cautioned that that timeline may be too quick to do a bill that has a deep impact on the economy.

“Senate Foreign Relations Chairman John Kerry, D-Mass., and Sen. Lindsey Graham, R-S.C., are scheduled to deliver remarks at a discussion hosted by several advocacy groups Wednesday in the Capitol. Kerry and Graham, along with Sen. Joe Lieberman, I/D-Conn., are working together to forge a bipartisan climate bill. Other speakers include energy experts in the national security and agriculture arenas. The discussion’s sponsors include Operation Free, Blue Green Alliance, National Farmers Union and We Can Lead.”

In more detailed reporting regarding the ‘disapproval resolution’ co-sponsored by Sens. Murkowski and Lincoln, Manu Raju reported yesterday at Politico that, “[T]here are other signs that moderates are growing eager to show independence from their party. Sen. Lisa Murkowski (R-Alaska) has offered a resolution to block an effort by the Environmental Protection Agency to control carbon dioxide, and she’s receiving strong support from the likes of moderate Democratic Sens. Ben Nelson of Nebraska, Mary Landrieu of Louisiana and Blanche Lincoln of Arkansas.

Murkowski is courting other wavering Democrats. And since the resolution requires only a simple majority for approval, Republicans believe they have a shot at a symbolic victory over the administration’s climate change agenda.”

And a news release issued yesterday by the National Council of Farmer Cooperatives (NCFC) indicated that, “The [NCFC] today announced its strong support for a resolution offered by Senator Lisa Murkowski (R-Alaska) under the Congressional Review Act that would prevent the Environmental Protection Agency (EPA) from regulating greenhouse gases under the Clean Air Act (CAA). The resolution comes after the EPA issued an endangerment finding under the Act that greenhouse gases present a threat to human health.

“‘It should be clear by now that the Clean Air Act is a totally inappropriate vehicle for attempting to reduce greenhouse gas emissions, and I would like to applaud Senator Murkowski’s leadership in seeing this issue brought before the Senate,’ said NCFC President and CEO Chuck Conner. ‘Subjecting greenhouse gases to regulation under the act would not only be a nightmare to enforce, but has the potential to lead to higher agricultural input costs, dramatic land use changes, and a raft of other unintended consequences. In addition, if the U.S. were to take this step unilaterally, our farmers and ranchers would be at a severe disadvantage to unregulated foreign competition, further damaging the profitability of American agriculture and threatening the rural economy.’

“‘For those of us in the co-op community, it has been heartening to see the leadership offered on this issue by the Senate co-chairs of the Congressional Farmer Cooperative Caucus—Senator Blanche Lincoln (D-Ark.) and Senator John Thune (R-S.D.),’ continued Conner.”

A news release issued on Friday by the National Cotton Council noted that, “The National Cotton Council said today it was reassuring to the agricultural community to see Senate Committee on Agriculture, Nutrition and Forestry Chairman Blanche Lincoln (D-AR) and Ranking Member Saxby Chambliss (R-GA) responding to 138 diverse organizations by joining 35 other senators in cosponsoring a measure that would keep U.S. farmers and ranchers from economic harm.

“The NCC said the Sen. Murkowski (R-AK)-introduced ‘resolution of disapproval,’ if passed, will repeal EPA’s endangerment finding on greenhouse gases (GHG), preventing EPA from regulating GHGs under the Clean Air Act (CAA).”

Reuters writers Richard Cowan and Timothy Gardner reported yesterday that, “When U.S. President Barack Obama delivers his State of the Union address on Wednesday, he is expected to promote alternative energy as a way of tackling global warming problems and creating more domestic jobs.

But climate change legislation is facing serious difficulties in Congress, where many politicians do not want to cast votes on legislation that some fear could eventually raise energy prices on the heels of a severe economic recession.

“Also, with the November congressional elections coming into focus, lawmakers are keeping a close eye on public opinion polls, some of which show support is sinking for a climate bill this year.”

The Reuters article stated that, “Some prominent Senate Democrats already have predicted that comprehensive climate control legislation, such as cap and trade, will not pass this year.

A new poll by the Pew Research Center for the People and the Press says that only 28 percent of those surveyed now list global warming as a top priority this year. That’s down from 38 percent in 2007.

Dealing with domestic energy problems was listed as a top domestic priority by 49 percent, down from 60 percent a year ago, according to the Pew poll.”

Cowan and Gardner went on to explain that, “If [Senator John Kerry ] fails to find a compromise bill, Democrats might push a narrower bill requiring more use of alternative energy sources, such as solar and wind power, without mandatory reductions in carbon dioxide emissions.

“Environmental groups would have a hard time supporting the expanded oil and gas drilling and more help for nuclear power without imposing mandatory caps on carbon.

“The Environmental Protection Agency is threatening to regulate carbon emissions if Congress won’t.

Regulations could go forward as early as March. But a barrage of lawsuits is expected from opponents, which could delay action.”

Crop Insurance

DTN Executive Editor Marcia Zarley Taylor reported yesterday (link requires subscription) that, “USDA’s decision last month to eliminate county-based crop insurance from one-third of the 3,141 ag counties nationwide in 2010 leaves great swaths of the South, Great Plains and eastern U.S. with subpar risk-management options compared to their Midwest peers, farmers and crop insurance sources tell DTN. The decision affects corn, soybean, grain sorghum, cotton and peanut producers and also raises questions about the accuracy of USDA’s county-level yield data for other purposes.

“Corn farmers in Lawrence County, Ala., are among those with the biggest gaps in insurance coverage. Eliminating county-based crop insurance there reduces the maximum insurable corn yield coverage to about 60 bushels per acre, down from their guaranteed 135 bpa under Group Risk Income Protection (GRIP) and Group Risk Program (GRP) in 2008.”

Yesterday’s DTN article added that, “One reason for the regional gap is that while Revenue Assurance and Crop Revenue Coverage remain available in all counties affected by the Risk Management Agency’s new policy, many Southern growers can cover only 75 percent of their historic yields with those policies, crop insurance sources said, not the 80 percent or 85 percent available for individual policies in the Midwest. County-based insurance allowed buy-ups to 90 percent coverage.

In USDA’s defense, federal crop-insurance officials argue that farmers were only buying county-based insurance in 310 of 1,062 counties where it plans to cancel GRP and GRIP for corn, soybeans, cotton, grain sorghum and peanuts in 2010. What’s more, USDA statisticians said their inability to collect at least 30 yield reports or 25 percent of a county’s harvested area makes county-based insurance hard to validate.”

Meanwhile, DTN Ag Policy Editor Chris Clayton reported yesterday (link requires subscription) that, “Major commodity and general farm organizations asked USDA on Monday not to undermine the gains made in crop insurance over the past decade with a proposed $4 billion cut in payments to the crop-insurance industry.

“Adding their voices to a list of people resisting more cuts to crop insurance, the farm groups co-signed a letter to Secretary of Agriculture Tom Vilsack asking him to ensure that a new standard reinsurance agreement actually strengthen risk-management for farmers and increase access to crop insurance.

“‘The consideration of a $4 billion cut to the crop insurance program over five years on top of several substantial cuts made last year concerns both producers and businesses,’ stated National Farmers Union President Roger Johnson.”

Mr. Clayton added that, “The farm organizations are concerned about USDA’s first proposal, which included $4 billion in cuts to the crop-insurance program over five years. The farm groups stated that crop insurers had already sustained a cut of $6.4 billion over 10 years in the 2008 farm bill. Other government sources put that farm bill cut at closer to $5.6 billion over 10 years.”

Nutrition Programs

A House Agriculture Committee news release from yesterday stated that, “Today, the House Agriculture Subcommittee on Department Operations, Oversight, Nutrition and Forestry held a field hearing in Colton, California, to review federal nutrition programs. Representative Joe Baca, who represents Colton in the U.S. Congress, chaired today’s hearing.

“‘Obesity related health spending has doubled in the past decade to reach a high of $147 billion annually,’ Chairman Baca said. ‘If nothing is done to change this trajectory, it is estimated obesity will cost our nation $1 trillion by the year 2030. We must act decisively to stop this oncoming crisis and create healthier communities across our nation. Today’s hearing was an excellent opportunity to hear from experts at the local, state, and national level on ways to increase participation rates for nutrition programs and to better educate the public on healthy lifestyles.’”

Meanwhile, Jason DeParle reported in today’s New York Times that, “Nearly one in five Americans said they lacked the money to buy the food they needed at some point in the last year, according to a survey co-sponsored by the Gallup organization and released Tuesday by an anti-hunger group.

“The numbers soared at the start of the recession, but dipped in 2009 despite the continuing rise in unemployment. The anti-hunger group, the Food Research and Action Center, attributed that trend to falling food prices, an increasing use of food stamps and a rise in the amount of the food stamps benefit.

More than 38 million Americans — one in eight — now receive food stamps, a record high.”

USDA Nomination

A news release issued yesterday by USDA indicated that, “President Obama today announced his intent to nominate Dr. Elisabeth Hagen as the U.S. Department of Agriculture’s Under Secretary for Food Safety. Hagen will serve with Agriculture Secretary Tom Vilsack.”

Keith Good

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