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Farm Bill; Regulations; Biotech; and Ag Economy

Farm Bill: Political Notes- Budget and Spending

David Rogers reported yesterday at Politico that, “Alarmed by new deficit estimates, the Senate Budget Committee signaled Thursday that it may go beyond its typical five-year spending resolution this spring and instead pick up where a presidential commission left off last month, forcing votes on a longer-range scheme for deficit reduction.

“Leading members of both parties on the committee expressed an openness to that approach, and if the initiative were to gain steam in the Senate, it could become a vehicle to bring President Barack Obama and the new House Republican majority to the table.

“‘I’m not certain that it’s not going to fall to us to put a plan out there for our colleagues on the floor,’ said committee Chairman Kent Conrad (D-N.D.). ‘I’m going to be having discussions with members of the committee on both sides to see what the feeling would be about our taking this on and laying a plan before our colleagues.’”

(FarmPolicy Note: Extended remarks on this issue from Chairman Conrad at yesterday’s Budget Committee hearing can be heard here (MP3- 2:40)).

Yesterday’s Politico article added that, “Conrad said his preference would be for a deficit reduction summit between the White House and bipartisan leadership in Congress. But given the continued political standoff, he and several Republicans on the panel are clearly attracted to the idea of using the annual budget debate to force consideration of the more far-reaching changes recommended by the debt commission.”

“‘The thing that makes the most sense is there is a summit between the White House [and] leaders of the House and the Senate, because at the end of the day, the White House has got to be at the table,’ Conrad said. ‘If there is not going to be a summit, if there is not going to be some negotiation, maybe it’s going to fall to this committee to put forward a plan.’

“‘Maybe we’re the only ones who are going to have an opportunity to lay out a comprehensive plan absent some kind of summit.’”

Meanwhile, Alexander Bolton reported yesterday at The Hill Online that, “Sen. Mike Lee (R-Utah), a founding member of the Senate’s Tea Party Caucus, has pledged to filibuster legislation to increase the debt ceiling.

Lee said a filibuster could be averted only if Senate Majority Leader Harry Reid (D-Nev.) and GOP leader Mitch McConnell (Ky.) reach an agreement to pass a balanced-budget amendment through the Senate.”

The article noted that, “Sen. Jim DeMint (R-S.C.) has also said he will oppose legislation to raise the debt limit unless the Senate first passes a balanced-budget amendment. Passage of the amendment would need support from two-thirds of the Senate.”

And Ledyard King reported yesterday at the Argus Leader Online (SD) that, “Get ready for some pain.

“South Dakota Sens. Tim Johnson and John Thune say they welcome President Obama’s call for a five-year freeze on discretionary spending and an end to pork-barrel earmarks even though it probably will stunt – if not slice into – many important programs that benefit the state.

“‘Right now, we have got to deal with the fact that we’ve got a $14.3 trillion debt that’s growing by over $1 trillion every year with no end in sight and presents, in my judgment, a huge, huge cloud over the American economy,’ Thune, a Republican, told reporters Wednesday. ‘We’re going to have to make some hard decisions. We’ve put them off for way too long.’”

The article added that, “Thune also thinks direct farm payments are in jeopardy if true spending reform is adopted.

“‘The next farm bill is going to be more difficult for sure because the budgetary constraints that we face today and the budgetary environment that we’re in is going to subject every aspect of the budget to very serious scrutiny,’ Thune said. ‘This is not going to be pleasant. These are going to be painful decisions.’”

Farm Bill: Policy and Personnel

Earlier this week in an interview with Randy Koenen of the Red River Farm Network (RRFN), Agriculture Secretary Tom Vilsack spoke briefly about the 2012 Farm Bill, noting in part that, “I think one of the key issues that we are going to be discussing in the Farm Bill is whether or not a safety net is something that provides farmers payments every year, regardless of whether it’s a good year or a bad year, or is the safety net something that provides a good deal of help, and important help at a time when you need it most.

“I thought we had the beginning of that conversation with the 2008 Farm Bill, with the establishment of the ACRE program, and the establishment of the various disaster programs under SURE and so forth, and I think we will see a continuation of that conversation particularly in light of the need for all of us to be serious about deficit reduction.”

To listen to a portion of RRFN interview with Secretary Vilsack, just click here (MP3- 1:25)

A news release earlier this week from Sen. Jeanne Shaheen (D-NH) stated that, “[Sen. Shaheen] today introduced a bipartisan bill that would phase out the sugar support program and save consumers billions of dollars. The SUGAR (Stop Unfair Giveaway and Restrictions) Act, co-sponsored by Mark Kirk (R-IL), comes as part of Shaheen’s effort to eliminate unnecessary government programs.

“‘The sugar support program costs consumers $4 billion a year-to disproportionally benefit a limited group of wealthy sugar producers,’ Shaheen said. ‘The SUGAR Act protects consumers, saves American jobs, and allows U.S. confectioners, bakers, beverage companies, and food manufacturers to stay in business. We must stop sugar’s sweet deal.’”

In a related item, Curtis Gilbert reported earlier this week at Minnesota Public Radio (MPR) Online that, “If you made a list of the Minnesota-based companies that spend the most money lobbying the federal government, you’d see some familiar names, with Medtronic and Target at the top. But there is one relatively small Minnesota company that has become a big political player.

American Crystal Sugar pulls in annual revenues of about $1.2 billion. The Moorhead-based cooperative of about 3,000 sugar beet farmers doesn’t even crack the top 50 largest Minnesota companies. But when it comes to influence in Washington, Crystal is king.”

The MPR article noted that, “What does American Crystal Sugar have at stake in Washington?

“Three words: The Farm Bill. The federal government runs a complex system that guarantees the price for American-produced sugar and limits foreign competition. American Crystal wants those programs maintained.”

The radio piece added that, “‘There are just some realities to the world of sugar and the world sugar market that would allow a lot of foreign, subsidized sugar to be dumped into the United States market,’ American Crystal Sugar lobbyist Kevin Price explained. ‘The price would collapse and we’d go out of business.’

“American Crystal Sugar spends between $1 million and $2 million a year on lobbying the federal government. That’s about the same level as Cargill — a company almost 100 times its size. American Crystal’s political action committee spends another $1 million-plus every year on contributions to political campaigns.”

A news release yesterday from the Senate Agriculture Committee Chairwoman Debbie Stabenow (D-MI) stated that, “[Chairwoman Stabenow] today issued the following statement as her appointment, and all committee assignments, were officially announced today by Senate Majority Leader Harry Reid (D-NV) and Minority Leader Mitch McConnell (R-KY).

“‘I am so pleased to welcome all of our newly appointed Members to the Committee on Agriculture, Nutrition and Forestry. Agriculture is critical to our economy and is helping to lead our recovery. I look forward to working with all of our Committee colleagues to help create new jobs and continue America’s leadership in this important sector.’”

A full list of Sen. Ag. Comm. Members can be found here.

Georgia GOP Sen. Saxby Chambliss indicated a news release from yesterday that, “Today, Minority Leader Mitch McConnell appointed me to serve as the vice chairman of the Senate Select Committee on Intelligence. It has been an honor to serve as the top Republican on the Senate Committee on Agriculture, Nutrition and Forestry for the past six years, and I look forward to working closely with new committee leadership to champion agricultural issues of interest to my home state.

“Agriculture has been a top priority since I was first elected to Congress in 1994, and I have served on the House and Senate Agriculture Committees continuously ever since. Through work on multiple farm bills and other important agricultural legislation, I have been committed to supporting farmers, enhancing rural communities, and ensuring a safe, abundant and affordable food, fiber and fuel supply. Moving forward in the 112th Congress, I vow to continue to be a strong voice for Georgia and all of Southern agriculture.”

Farm Bill: Crop Insurance

A news release yesterday from the new Ranking Member of the Sen. Ag. Comm., Pat Roberts (R-KS), stated that, “[Sen. Roberts] and U.S. Senator Saxby Chambliss (R-GA) today sent the following bipartisan letter to U.S. Secretary of Agriculture, Tom Vilsack, commending USDA for proposing a Good Performance Refund (GPR) program aimed at strengthening the federal crop insurance program. While the GPR program is well intentioned, the senators expressed concerns that the eligibility criteria would benefit few producers from limited regions of the country, is not designed in the most cost effective manner, and falls short of meeting the intent of the law. Senator Roberts and Senator Chambliss offered to continue to work with Secretary Vilsack to improve the program and address their concerns.

“The letter was also signed by Senators Thad Cochran (R-MS), Max Baucus (D-MT), Mike Johanns (R-NE) and Ben Nelson (D-NE).”

For more background on this issue, see this item from the American Association of Crop Insurers that was included in Tuesday’s FarmPolicy.com report.

Farm Bill: Nutrition

Amie Parnes reported yesterday at Politico that, “Taking her Let’s Move! initiative on the road to Fort Jackson, S.C., Michelle Obama tied together her two favorite causes: childhood obesity and military families.

Childhood obesity is ‘not just a health issue for children, it’s a national security issue,’ Obama said while visiting the Army’s largest basic training facility. ‘You have to get the whole country behind this because it’s affecting our ability to protect our freedom.’

“In a briefing at Fort Jackson, Lt. Gen. Mark Hertling, the Army’s initial training deputy commander, said attracting recruits who can meet physical fitness requirements is becoming more difficult.”

Regulations and Agriculture

Andy Eubank of Hoosier Ag Today (HAT) interviewed Ag. Sec. Tom Vilsack on Wednesday, and as part of their wide-ranging discussion, Sec. Vilsack addressed issues regarding federal regulations, the Environmental Protection Agency and agriculture. To listen to this portion of the HAT interview with Sec. Vilsack, just click here (MP3- 4:37); while the entire conversation is available here.

Meanwhile, a House Ag. Comm. release from yesterday noted that, “Rep. Frank Lucas (R- OK) and Rep. K. Michael Conaway (R-TX) sent a letter to the chairman of the Commodity Futures Trading Commission (CFTC), Gary Gensler, yesterday requesting that the agency voluntarily adhere to President Obama’s executive order.

The executive order calls for certain federal agencies and departments to review regulations to ensure they do not ‘stifle job creation and make our economy less competitive.’ However, the CFTC would be exempt because it is an independent agency. CFTC is tasked with implementing an unprecedented number of new regulations required under the Dodd-Frank Wall Street Reform and Consumer Protection Act, which has the potential to impact every segment of the economy. Reps. Lucas and Conaway point out that it is imperative the CFTC consider unintended consequences.

“‘The regulations from Dodd-Frank will have a far-reaching impact on our economy and if the administration excludes them from review then President Obama’s initiative is not credible. The scope and magnitude of Dodd-Frank calls for a careful and methodical rulemaking process to prevent harming an already struggling economy. It is my hope that Chairman Gensler will voluntarily comply with the executive order,’ said Rep. Frank D. Lucas, Chairman of the House Agriculture Committee.”


Andrew Pollack reported in today’s New York Times that, “Agriculture Secretary Tom Vilsack announced on Thursday that he would authorize the unrestricted commercial cultivation of genetically modified alfalfa, setting aside a controversial compromise that had generated stiff opposition.

“In making the decision, Mr. Vilsack pulled back from a novel proposal that would have restricted the growing of genetically engineered alfalfa to protect organic farmers from so-called biotech contamination. That proposal drew criticism at a recent Congressional hearing and in public forums where Mr. Vilsack outlined the option.

“Mr. Vilsack said Thursday that his department would take other measures, like conducting research and promoting dialogue, to make sure that pure, nonengineered alfalfa seed would remain available.”

A release from the Sen. Ag. Comm. stated that, “U.S. Senator Debbie Stabenow, D-Mich., Chairwoman of the Senate Committee on Agriculture, Nutrition and Forestry, expressed support for the U.S. Department of Agriculture’s decision today to deregulate Roundup Ready alfalfa, but cautioned that flaws in the current biotechnology regulatory system, caused by multiple lawsuits, must be addressed to provide certainty for industry investors, farmers and consumers.

“‘I applaud the USDA’s decision to deregulate Roundup Ready alfalfa, giving growers the green light to begin planting an abundant, affordable and safe crop,’ Stabenow said. ‘While I’m glad this decision was guided by sound science, I’m concerned that USDA’s process creates too much uncertainty for our growers. Alfalfa was one of nearly two dozen genetically modified crops awaiting USDA evaluation and approval – a bottlenecked process that hinders growth and progress.’

“‘As incoming Chairwoman of the Senate Agriculture Committee, I’m committed to working with the USDA and stakeholders so that the system promotes safety, certainty, and efficiency. In the coming months, I will examine how we can promote a properly functioning, science-based system that promotes industry investment, growth and job creation while ensuring that consumers can count on safe and affordable products.’”

Chris Clayton captured additional reaction to USDA’s decision at the DTN Ag Policy blog yesterday.

Agricultural Economy

Javier Blas reported yesterday at The Financial Times Online that, “Governments across the developing world are stockpiling food staples in an attempt to contain panic buying, inflation and social unrest.

“But the hoarding is driving agricultural commodity prices even higher. The cost of wheat, the world’s most important staple, reached a fresh two-and-a-half-year high on Thursday, after countries from Algeria to Saudi Arabia announced extraordinary purchases.”

The FT item noted that, “‘If you look to the average prices from 2000 to 2006 I think we would stay above the levels we observed then,’ Gregory Page, chief executive of Cargill, the world’s largest trader of agricultural commodities, told the Financial Times in a video interview at the World Economic Forum in Davos.

“Mr Page, who said weather patterns would determine when prices peak, hopes they will not exceed 2007-08 levels if good weather prevails.

“‘Clearly at these prices, the farmers of the world are receiving a price signal to go out and intensify their agriculture,’ he said.”

Keith Good