FarmPolicy

September 2, 2014

Farm Bill; Climate Issues; Biotechnology; Food Safety; and Financial Regulation

Farm Bill

DTN Ag Policy Editor Chris Clayton reported on Friday that, “Congress has largely ignored proposals from the Obama administration to cut program payments to some of the nation’s larger farms. But, Secretary of Agriculture Tom Vilsack’s push to spend more money on rural development and spend less on farm programs is drawing some ire from lawmakers who want to preserve the current safety net for commercial farmers.

“Vilsack has been accused of promoting ‘bedroom communities’ and wasting precious budget resources to prop up the urban locavore movement at the expense of production agriculture. Last week, Sens. Saxby Chambliss, R-Ga., Pat Roberts, R-Kan., and John McCain, R-Ariz., wrote a letter complaining that USDA spent $65 million last year on the ‘Know Your Farmer, Know Your Food’ program and is expanding the program this year.”

Friday’s article pointed out that, “The complaint letter comes as Vilsack has become more vocal about the crisis rural America faces and suggests it could better be solved by focusing more on rural economic development and less on farm programs.

“It’s an argument that was made in 2005 by a report from the Federal Reserve Bank of Kansas City — that farm program payments don’t exactly translate into economic prosperity. In fact, the report showed that the counties most reliant on farm payments had stagnant job growth or outright job losses from 1992-2002, a time of generally good economic times.”

Mr. Clayton indicated that, “House Agriculture Committee Chairman Collin Peterson, D-Minn., who has driven the early talk about the 2012 farm bill, said he thinks Vilsack makes some valid points. But improving the state of the rural economy is a different conversation than helping farmers manage risk.

“‘There are two different issues,’ Peterson said. ‘I don’t think they are tied together, frankly. In the case of the traditional commodity programs and crop insurance and all of that stuff, the purpose of that is to help people manage their risk, to be able to borrow enough money that they can put a crop in the field. That’s why we have those programs. If you don’t have those programs, or some way for people to collateralize their capital, in my part of the world, they don’t have the capital to put a crop in the ground.’”

“Another major argument for protecting the current safety net is that farm programs help Americans pay less for food than they would otherwise. The $7.7 billion or so paid in commodity subsidies in 2009 helped lower overall grocery bills for Americans, according to defenders of farm program payments to farmers,” the DTN article said.

In an article posted on Saturday at the Pittsburgh Tribune-Review Online, Carl Prine reported that, “Vilsack continues to spar with mostly GOP congressmen in farm states over the direction of federal agriculture policy. Last week, House Agriculture Committee Republican leader Frank Lucas of Oklahoma blasted Vilsack’s emphasis on nontraditional farm issues such as regional food systems, organic vegetable cultivation, community gardens and other initiatives as threats to turn rural America into ‘bedroom communities.’”

The article stated that, “GOP U.S. Senators John McCain of Arizona, Saxby Chambliss of Georgia and Pat Roberts of Kansas, the ranking Republican on the powerful Senate Agriculture Committee, wrote Vilsack last week accusing his ‘Know Your Farmer, Know Your Food’ program of helping ‘small, hobbyist and organic producers whose customers generally consist of affluent patrons at urban farmers markets’ instead of traditional producers who grow most of America’s food.

“‘Well, it’s really an unfortunate circumstance,’ Vilsack told the Trib. ‘These senators have not taken the time to understand and appreciate our ‘Know Your Farmer, Know Your Food’ program.’

Calling their letter ‘inappropriate’ because they ‘didn’t take the time to find out’ key parts of the program such as trimming the distance traditional livestock ranchers need to drive their herds to slaughter, Vilsack said he would continue to promote community gardens, farmers markets and other initiatives as a means to find new markets for all producers.”

In related news, Rep. Jerry Moran (R-Kansas) issued a news release on Friday, where he noted in part that, “Kansas agricultural producers have made agriculture a way of life and it is critical that they have a Secretary of Agriculture who understands their unique challenges and advocates on their behalf. They need someone who recognizes the importance of a strong farm safety net, not a Secretary who finds questions about the farm safety net ‘irritating.’

Recent comments from the Secretary that off-farm income is ‘more critical than the safety net’ are not helpful to those of us on the Agriculture Committee charged with writing the next farm bill. To suggest that a farm bill should focus more on part-time farmers with a job in the city and 100 acres in the country, rather than full-time farmers, is an example of how out-of-touch this Administration is with actual producers. We cannot overlook the agricultural producers who make the business of farming and ranching their livelihood. Rural communities are built around these individuals and they are the ones that keep us fed and clothed.”

Meanwhile, Philip Brasher reported on Saturday at The Des Moines Register Online that, “New rules that were supposed to cut off farm subsidies to rich landowners and farmers did little to stem the flow of payments to Iowa’s largest corn and soybean operations.

“Twenty percent of the subsidy recipients in Iowa accounted for 63 percent of the payments in 2009, compared with 64 percent in 2007 before the rules were tightened, according to government data.”

The article noted that, “But those subsidies may be in for cuts in the next farm bill. The chairman of the House Agriculture Committee, Rep. Collin Peterson, R-Minn., thinks it makes more sense to subsidize farmers based on fluctuations in their revenue, rather than giving them the fixed payments.”

All subsidies may eventually be folded into some form of crop insurance, a system already heavily underwritten by taxpayers but with more public support, Peterson said.

“But that is no answer to concerns that the government payments go mainly to large farms, experts say. The crop insurance program, which allows farmers to protect themselves against drops in prices as well as drought and storm damage, has no limits on the acreage that farmers can cover,” the Register article said.

An update posted recently at WFTV Online (Florida) reported that, “Millions of your tax dollars are being paid to nearly 2,400 people in Florida, just over 250 in Central Florida, who may not deserve one cent. That’s because federal records show they’re dead.

“WFTV obtained the entire federal list of dead farmers (read it) who may still be receiving tax dollars. Reporter Berndt Petersen reveals abuse in the federal farm aid program.”

The article noted that, “‘People do the same thing with social security checks. Their relatives are cashing the checks when the person is dead. That’s against the law,’ Representative Cliff Steams (R-Ocala) said.

“Stearns said the U.S. Department of Agriculture was told about it in 2007, when the Government Accountability Office discovered 172,000 dead people nationwide received $1.1 billion in farm aid.”

Congressman John Mica (R – FL) fired off a letter (read it) to demand a Capitol Hill hearing.

“‘Something’s got to be done to get this madness under control,’ Mica said.”

In other news, a new Dairy Policy Analysis Alliance of the University of Missouri Food and Agricultural Policy Research Institute (FAPRI) and the University of Wisconsin-Madison Department of Agricultural and Applied Economics recently released a report titled, “Dairy Policy Issues for the 2012 Farm Bill.”

A University of Missouri news release from Friday noted that, “An alliance of dairy economists from Wisconsin and Missouri wants the industry to remember what worked—and what didn’t—as debate starts on dairy policy to include in the 2012 Farm Bill.”

“‘The booklets tell what was tried in the past, rather than proposing new policy. There are plenty of lessons from the strengths and weaknesses of the policy strategies already tried,’ [Scott Brown, dairy economist at the University of Missouri] said.”

And from an international perspective, Emily Wax reported in Saturday’s Washington Post (“Spread of insurance to rural areas underscores India’s growing prosperity”) that, “As India’s economy continues to click along at 7 percent growth, prosperity has spread beyond New Delhi and Mumbai and into the rural villages where a majority of Indians still live. Farmers who find themselves with a little disposable income are turning to insurance — a once-unthinkable luxury that allows them to secure their gains, plan with confidence and feel something that earlier generations could never imagine: hope in the future.”

“In addition to providing a measure of security, insurance has been an economic catalyst that has allowed farmers such as Debarasu to invest more boldly in new livestock or equipment, without the fear that a single storm or accident could wipe them out.”

The Post article added that, “K.G. Krishnamoorthy Rao, chief executive of Future Generali India Insurance, said the Mumbai-based company insured 40,000 cattle last year alone. It is now canvassing three more states. Future Generali and other private insurance companies often partner with nongovernmental groups to reach out to farmers. The groups also monitor the insurance companies to avoid scams.

“‘Rural India is our new and exciting frontier for major growth,’ Rao said. ‘We are insuring tractors, water pumps, even poultry. It’s a great sign of how healthy the economy is becoming in many villages.’

“The Indian government opened up insurance to private firms about a decade ago. In the past few years, more than 15 private companies started fanning out to farmers and day laborers, offering low-cost ‘microinsurance’ packages to the upwardly mobile Hindu hinterland.”

Climate Issues


CQPolitics reported on Friday
that, “Sens. John Kerry and Joseph I. Lieberman will unveil a long-awaited climate change bill on May 12, without the participation of their former partner, Sen. Lindsey Graham , who had been the measure’s only Republican supporter.”

A news release issued by Sen. Kerry on Friday stated that, “We’ve continued to work with the Senate leadership and the White House, and we believe we’ve made new progress on the path to 60 votes.”

A news release issued by Sen. Lindsey Graham on Friday stated that, “I believe there could be more than 60 votes for this bipartisan concept in the future. But there are not nearly 60 votes today and I do not see them materializing until we deal with the uncertainty of the immigration debate and the consequences of the oil spill.”

Glenn Thrush reported on Friday at Politico that, “Sen. Lindsey Graham (R-S.C.) has gone from fence-sitting to urging Democrats to scrap climate change legislation before the midterms — saying the Gulf oil spill warrants a pause in the effort.

“And his two former bargaining partners — Sens. John Kerry (D-Mass.) and Joe Lieberman (I-Conn.) – are planning to push forward without him, introducing a bill on Wednesday even though Graham’s comments significantly reduce the chances the landmark legislation will be passed before November.”

John M. Broder reported on Friday at The New York Times Online that, “Without the support of Mr. Graham and at least a handful of Republicans, the measure may well be dead for the year. Mr. Graham praised Mr. Kerry and Mr. Lieberman for their efforts, but said he would not join them.”

Nonetheless, Ben Geman reported on Friday at The Hill’s Energy and Environment Blog that, “White House Press Secretary Robert Gibbs on Friday disputed Sen. Lindsey Graham’s (R-S.C.) claim that the Gulf of Mexico oil spill should prompt a pause in efforts to advance energy and climate legislation.

“Gibbs noted that gasoline prices — which typically rise with the onset of summer — will create a ‘very public impetus’ for legislation. Gibbs also told reporters that the spill shows that ‘with what you see is going on in the Gulf, you understand that drilling and drilling alone isn’t going to solve our energy problems.’

“‘So I think, quite honestly, the time is . . . more ripe than it ever, in all honesty, has been,’ Gibbs said.”

From an international perspective, Dow Jones news reported on Saturday that, “The international community shouldn’t exaggerate expectations from global climate change talks in the Mexican resort of Cancun this year, although there is still time to strike a deal, India’s Minister for Environment and Forests said Saturday.

“Should the talks in Cancun prove inconclusive then an agreement on tackling global warming would be reached by 2011 at the latest when delegates reconvene in South Africa’s Cape Town, Jairam Ramesh said in a speech in Beijing.”

And Shai Oster reported on Friday at The Wall Street Journal Online that, “China is trying to strengthen its role as leader of the developing world in climate-change talks just as it faces an embarrassing setback in trying to curb its own carbon emissions.

“This weekend, China is hosting a high-profile global-warming forum that will feature the country’s top leaders and ministers from key negotiating blocs in the developing world, including its fellow Basic Group members Brazil, South Africa and India.”

The Journal article noted that, “Such a signal is especially urgent after news that China’s infrastructure and housing-led economic recovery increased the country’s energy intensity 3.2% in the first quarter compared with a year earlier, reversing a steady decline. China said it would cut energy intensity 20% by the end of this year, a goal that is closely tied to the country’s promise to the international community to reduce its carbon intensity—the amount of carbon emitted per dollar of GDP—by 40% to 45% by 2020. Most of China’s energy comes from burning coal, a major source of carbon emissions.

China’s climate-change czar said a binding pact on tackling global warming remains out of reach until several big issues are settled, including how to track $100 billion in funds for developing nations to rein in greenhouse gases over the next decade.

“‘I think the possibility to reach a legally binding agreement is low’ at the U.N. Climate summit in the Mexican resort of Cancun, due to take place at the end of this year, Xie Zhenhua said. ‘There are only a few months left.’ Instead, the focus would be on talks in South Africa in 2011 where Xie said a legally binding agreement is likely to be reached.”

Biotechnology

James Kanter reported in a column posted yesterday at The New York Times Online that, “Madeira is more than 500 kilometers from the African coast and is officially one of the ‘outermost regions’ of the European Union.

“Despite that far-flung status, Madeira catapulted into the center of the Union’s agricultural and environmental affairs last year when Portugal asked the European Commission for permission to impose an unprecedented ban on growing biotech crops there.

“Last week, the commission quietly let the deadline pass for opposing Portugal’s request, allowing Madeira, which is one of Portugal’s autonomous regions, to become the first E.U. territory to get formal permission from Brussels to remain entirely free of genetically modified organisms.”

The Times article added that, “But the case of Madeira represents a significant landmark, because it is the first time the commission, which runs the day-to-day affairs of the European Union, has permitted a country to impose such a sweeping and definitive rejection of the technology.”

Meanwhile, The Des Moines Register’s Philip Brasher has compiled a series of articles and interesting photos posted at the paper’s webpage titled, “Special report: Can biotechnology save Africa?”

The Register noted that, “Philip Brasher traveled to Kenya and South Africa in November after winning a World Affairs Journalism Fellowship. This project was directed by the International Center for Journalists and funded by the Ethics and Excellence in Journalism Foundation and the Pulitzer Center on Crisis Reporting. It was Brasher’s fifth trip to Africa.”

Food Safety

Carolyn Lochhead reported on Friday at the San Francisco Chronicle Online that, “As lettuce contaminated with E. coli was traced to an Ohio company Thursday, a House committee heard testimony on two government reports showing that the Food and Drug Administration inspects just 1 in 4 U.S. food facilities each year, and only a tiny fraction overseas.

“The Government Accountability Office [related testimony] and the Office of Inspector General [related testimony] overseeing the FDA called on a panel of the House Energy and Commerce Committee to increase the FDA’s authority to issue mandatory recalls and require food facilities, including many farms, to impose new safety controls.

“The reports added fuel to a bipartisan push for new food safety legislation: S510, which is pending in the Senate, and HR2749, which passed the House in July. Small growers in California say the bills threaten their existence with costly new rules and can conflict with organic methods.”

Financial Regulation

Brady Dennis reported in today’s Washington Post that, “The tourists had gone. His colleagues had cleared out.

“But Majority Leader Harry M. Reid (D-Nev.) remained on the deserted Senate floor last Tuesday evening, looking sullen. The Senate had just approved July 9, 2010, as ‘Collector Car Appreciation Day.’ What it had not done for days was make headway on a 1,400-page bill to overhaul the nation’s financial regulations.”

The article noted that, “Reid has said he hopes to wrap up the financial overhaul bill by the end of the week. With no votes scheduled for Monday or Friday, that leaves lawmakers just three days to hammer out the remaining differences on topics as complex as regulating the $600 trillion financial derivatives market.

“Several times in recent days, Reid has ticked off other priorities on the Senate’s plate. Appropriation bills. Food-safety legislation. Tax provisions. Presidential nominations. A jobs package. And on and on. ‘We have no choice but to finish’ the financial overhaul soon, he told reporters, warning that lawmakers might have to delay their planned August recess.”

Keith Good

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