FarmPolicy

September 18, 2019

Farm Bill; Trade; Regulation; and Ag Economy

Farm Bill: Background- Budget and Spending Issues

Jonathan Allen and Jake Sherman reported yesterday at Politico that, “It’s finally slash-and-burn time for conservatives, and the programs they target in a massive spending bill next week will help shape the national political debate over what the government can, and should, pay for.

Republicans are planning a freewheeling, open-ended debate that promises to test the party’s limits on how far it’s willing to go on spending cuts, and it may divide Democrats between those who want to embrace modest cuts and those who want to protect domestic programs from the GOP ax.”

The article added that, “The most conservative faction in the House, the Republican Study Committee, already is preparing amendments that would choke off funding for President Barack Obama’s new health care law, cut domestic programs by $100 billion and force the government to pay creditors before funding other priorities if the limit on the national debt is hit. The RSC proposals would cut tens of billions of dollars more than Budget Committee Chairman Paul Ryan (R-Wis.) has proposed, reflecting new tension within the GOP majority over how aggressive it should be.

“The spending bill, called a ‘continuing resolution’ or ‘CR,’ is necessary because, without it, the government will run out of authority to spend money on March 4. Republican leaders rolled out the top-line spending number last week, and they’re expected to provide the details of the plan later this week. The bill is likely to hit the floor next week.”

Erik Wasson reported yesterday at The Hill Online that, “Blue Dog Democrats might support a plan from House Republicans to cut $32 billion in discretionary spending this year, a spokesman for the fiscally conservative bloc said Monday.

“Rep. Mike Ross (D-Ark.) said the Blue Dogs are waiting to see the details of the proposed GOP cuts before taking a position. The draft legislation from the House Appropriations Committee is due on Thursday.

“But the comments from Ross and other Blue Dogs suggest at least some of the coalition’s members are willing to defect from their party and vote for the plan despite the vocal opposition of House Minority Leader Nancy Pelosi (D-Calif.).”

Meanwhile, David Rogers reported last night at Politico that, “As key senators met Monday evening on a bipartisan deficit reduction plan, President Barack Obama faced increased pressure to articulate a strategy for himself and his party, already so edgy about spending cuts that many Democrats seem prepared to ignore the consequences for policy.

“Indeed, Obama and House Republican leaders share this much in the coming budget wars: Both are racing to catch up with the train. And just as the president must contend with panicky Democrats, Speaker John Boehner (R-Ohio) faces tea party freshmen wanting to more than double the $32 billion in reductions now proposed by the GOP for the last seven months of this fiscal year.

“Wednesday’s House Republican conference will be a first test of just how powerful these demands are. But some observers believe that if the House were to stay close to the $32 billion range, Republicans might be able to push through the package in the Senate, where Democrats face their own deadline for action in March.”

Mr. Rogers added that, “Running close to two hours and hosted by Senate Majority Whip Richard Durbin (D-Ill.) in his third floor Capitol offices, the meeting had an equal mix of Democrats—Durbin, [Sen. Budget Comm. Chairman Kent Conrad (D-ND)], and Virginia Sen. Mark Warner—and Republicans: Sens. Saxby Chambliss of Georgia, Tom Coburn of Oklahoma, and Mike Crapo of Idaho.

“Durbin, Conrad, Coburn and Crapo are all veterans of the [President’s debt] commission while Warner and Chambliss—an old friend of Boehner’s—have joined forces in an effort to advance the same agenda.

The goal is to revive — in either legislative form or the spring budget resolution — major elements of the commission’s plan to narrow future deficits by nearly $4 trillion over the next 10 years. Appropriations cuts would be part of the strategy but so would entitlement and tax reform. And if the senators can show enough political strength, the hope is that this would give Boehner and Obama enough cover to join them.”

Separately, with respect to the debt limit, Lisa Mascaro reported last night at the Los Angeles Times Online that, “House Republican leaders are prepared to take the politically unpopular step of raising the nation’s debt limit this spring — if the price is right.

Their strategy is to extract steep spending cuts in exchange for acquiescing to the Obama administration’s request to increase the debt ceiling beyond its $14.29-trillion limit.”

More specifically on farm spending, Chad Pergram indicated last week at a Fox News political Blog that, “Want to chop agriculture subsidies? That $13 billion slice will save taxpayers very little in that nearly $4 trillion budget. And taking a knife to farm programs is a risky proposition for any politician.

“In February, 1979, some 6,000 farmers drove their tractors to Washington to protest President Carter’s farm policies. The images of thousands of John Deere, Massey Ferguson and Farmall Cub tractors wheeling up and down Pennsylvania Avenue created a great tele-narrative for the news and the farmers won the day.

But the bulk of federal agriculture spending is devoted to food stamps and child nutrition programs. That visual isn’t as ripe for the TV cameras. And of course, most of that assistance goes to districts represented by liberal, urban Democrats who are no longer in charge. If lawmakers do start cutting agriculture spending, do they slash those food assistance programs that often benefit the constituents of liberal lawmakers or do they take an ax to farmers in rural America, who are now represented by conservative Republicans.”

Mr. Pergram added that, “Of course, farm program advocates invoke old chestnuts that warn against cutting food production. They argue that producing inexpensive food is critical to national security and the U.S. needs to help feed the world when the global population tops 9 billion in less than 30 years. They assert that superior food production helped the U.S. military win World War II.

But again, it’s hard to have things both ways. True cuts would mean taking a chainsaw to farm programs. And that won’t go over very well back home in the ag heavy districts represented by freshman Reps. Rick Berg (R-ND) and Kristi Noem (R-SD).”

Farm Bill: Perspectives

Nathan Hurst reported yesterday at The Detroit News Online that, “Michigan farmers and food processors are hopeful that having one of the state’s senators leading the debate over the 2012 farm bill will benefit every aspect of Michigan’s $71.3 billion agriculture industry.

“But their optimism comes at a critical juncture, with work on the bill — one of Congress’ biggest spending measures — starting just as many are vowing to rein in federal spending.”

Mr. Hurst noted that, “All told, Congress’ farm bills touch every step in the modern human nutrition chain from farm to fork, enacting a wide swath of policies including crop subsidies and price supports, insurance, food stamps and even land conservation. And Sen. Debbie Stabenow, D-Lansing, now chairwoman of the Senate’s Agriculture Committee, said the next bill is likely to go further than its predecessor, pushing beyond food to tackle energy needs, hopefully with increased support for biomass fuel producers.

“But the road ahead is likely to be rough, if history is any indication. The last farm bill, enacted in 2008, cost $288 billion over five years and included billions in crop subsidies and other price supports that were flashpoints for tea party rhetoric leading up to last year’s elections.”

Yesterday’s article pointed out that, “Stabenow has begun the conversation about changes in next year’s farm bill, including reining in crop subsidies in favor of better support for crop insurance.

“‘There are certainly a lot of ways we can look at doing more with less, and a shift toward crop insurance could be part of it,’ Stabenow told The News.”

The article indicated that, “While the upper chamber is controlled by Democrats, the GOP is in charge of the lower chamber, meaning Stabenow will have to walk a tight-rope between supporting Michigan’s second-largest industry and making sure the bill will be lean and efficient enough to get at least some Republican backing in the House.

This go-round, Republican opposition to federal spending is at an all-time high and any work over the next 18 or so months on Stabenow’s committee will have to mesh with potentially competing ideas from the GOP-controlled House Agriculture Committee, which includes tea party newcomers like Rep. Bobby Schilling, R-Ill. It will have to provide enough support for farmers and nutrition programs to appease the Obama White House as well.”

Paul Post reported on Friday at The Saratogian Online (Saratoga Springs, NY) that, “Environmental regulations, labor issues and the 2012 Farm Bill were the focus of U.S. Rep. Chris Gibson’s newly formed agriculture advisory panel on Friday.”

“The panel was created to give the freshman lawmaker grass-roots input on farming issues that he can take to Washington, D.C., when developing federal policy and legislation.

“‘There’s clearly a concern that the voice of family farmers isn’t being heard,’ said Gibson, R-Kinderhook, a member of the House Agriculture Committee. ‘We need to make sure their interests are upheld.’”

The link includes a video interview with Rep. Gibson as well.

A National Farmers Union news release from yesterday stated that, “National Farmers Union (NFU) President Roger Johnson discussed the need for a farm bill when he addressed the Crop Insurance Industry Convention today in Indian Wells, Calif. The convention is hosted by the American Association of Crop Insurers and National Crop Insurance Services…Johnson also advocated for the inclusion of a strong safety net in the 2012 Farm Bill.

“‘A robust safety net is critical to the safety and well-being of American agriculture and society in general,’ said Johnson. ‘Americans spend only ten cents of every disposable dollar on food, the lowest rate in the industrialized world. Policymakers should work to strengthen the safety net by designing policies to assist farmers and ranchers during difficult times instead of simply all the time. A strong safety net in the next farm bill is in the best interest of producers as well as consumers.’”

And an editorial posted last week at the Lincoln Journal Star (NE) indicated that, “The U.S. Department of Agriculture should be congratulated for giving high priority to the Conservation Reserve Program at a time when budget pressures are building.

“U.S. Agriculture Secretary Tom Vilsack announced last week in Omaha that federal officials plan to keep the program at the full acreage maximum authorized by the 2008 farm bill.”

The opinion item added that, “Unlike many agricultural subsidies, the CRP program is one that deservedly draws broad-based support from environmentalists, hunters, birdwatchers and traditional farm organizations. Those supporters will need to be ready to defend the program as budget knives are being sharpened in Washington.”

Trade

In a speech yesterday to the Chamber of Commerce, President Obama stated that, “We recently signed export deals with India and China that will support more than 250,000 jobs here in the United States. We finalized a trade agreement with South Korea that will support at least 70,000 American jobs. And by the way, it’s a deal that has unprecedented support from business and labor, Democrats and Republicans. That’s the kind of deal that I will be looking for as we pursue trade agreements with Panama and Colombia, as we work to bring Russia into the international trading system.”

In remarks on the Senate floor yesterday, GOP Leader Mitch McConnell (KY) indicated that, “We welcome the President’s support for the South Korea Free Trade Agreement, which has earned strong bipartisan support. But by failing to show the same commitment in passing these two other free trade agreements, the President is missing out on an important opportunity to do something good for the economy and for jobs.”

And Nebraska GOP Sen. Mike Johanns also spoke yesterday on the Senate floor about the U.S.-Colombia trade agreement- a video replay of his remarks can be found here.

Regulation

Philip Rucker and David S. Hilzenrath reported in yesterday’s Washington Post that, “House Republicans are scrutinizing a wide array of existing and proposed Obama administration regulations in areas as diverse as the environment and Wall Street, and they are taking guidance from industry groups that say the rules threaten jobs.

Responding to solicitations from Rep. Darrell Issa (R-Calif.), businesses have asked Congress to roll back or preempt more than 150 rules governing their industries, according to documents obtained by The Washington Post.

“In many cases, businesses are seizing the opportunity to reopen regulatory debates that they previously lost. In his new role as chairman of the House Committee on Oversight and Government Reform, Issa will begin a series of hearings Thursday, an effort aimed at fulfilling the new GOP House majority’s goal of making federal regulations friendlier to business.”

Louise Radnofsky reported yesterday at The Wall Street Journal Online that, “The Environmental Protection Agency, which enforces rules that affect the U.S. economy from factories to farms, is the No. 1 target of complaints from business groups collected by House Republican leaders.

“EPA rules were cited more than those from any other agency in more than 100 letters sent by trade associations, businesses and some conservative groups to House oversight committee chairman Darrell Issa (R., Calif.) in response to his call for businesses to identify regulations they deemed burdensome, according to documents reviewed by the Wall Street Journal.”

And Robin Bravender and Darren Goode reported yesterday at Politico that, “The showdown between House Republicans and the White House over climate change and environmental policies kicks off Wednesday with EPA chief Lisa Jackson as the star witness.

“The Energy and Commerce Committee will hold a hearing on legislation floated last week by Chairman Fred Upton (R-Mich.), Rep. Ed Whitfield (R-Ky.) and Sen. Jim Inhofe (R-Okla.) to strip the Environmental Protection Agency of its authority to regulate greenhouse gases under the Clean Air Act.”

Agricultural Economy

Reuters writer Sam Nelson reported yesterday that, “America’s supply of corn is expected to keep shrinking as offtake from ethanol makers expands, dropping the 2010/11 supply to its lowest in 15 years even as use for feed and export stabilizes or wanes.”

In-Soo Nam reported yesterday at The Wall Street Journal Online that, “South Korean President Lee Myung-bak on Monday called for a task force to help secure a stable supply of food amid growing concerns about global shortages and rising prices.

“While Mr. Lee linked the need for action to possible food shortages triggered by climate change, his comments reflect concerns in South Korea over global food-price volatility, given that the country imports around 70% of its food.”

And Bloomberg writer William Davison reported yesterday that, “Ethiopia raised the estimate of the number of people who will need food aid this year by half a million to 2.8 million because of drought in the Somali region, Agriculture State Minister Mitiku Kassa said today.

“The government in November estimated that a bumper harvest had cut the number of Ethiopians needing emergency food aid to 2.3 million from more than 5 million. About 107,000 children may need treatment for severe malnutrition, the United Nations humanitarian coordinator in Ethiopia, Eugene Owusu, said at a joint briefing with Mitiku in the capital, Addis Ababa.”

Keith Good

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