January 19, 2020

Climate Change; Ag Economy Issues; Trade; and Food Assistance

Climate Change

The “Washington Insider” section of DTN indicated on Friday (link requires subscription) that, “Throughout much of last year, Agriculture Secretary Tom Vilsack unequivocally stated and restated that cap and trade programs, such as those in the House climate change bill, would mean significant positive net benefits for agriculture. USDA staff worked under pressure to use its massive economic models, together with those from universities and elsewhere, to measure the effects of such a program — and, frankly, to build support for the legislation.

“However, when the details of these studies began to emerge and be examined critically by congressional staff and others, questions began to emerge. It appeared that the models used were based on a number of critical assumptions and focused narrowly. They appeared to say that cap and trade programs were indeed capable of raising agricultural prices and returns — but that in the cases examined, many of those benefits took place in a much reduced sector, with millions of acres diverted into ‘sequestration’ projects and planted to grasses or trees.”