Farm Bill Issues
A joint statement Friday from Treasury Secretary Tim Geithner and OMB Deputy Director for Management Jeffrey Zients indicated that, “[Sec. Geithner] and [Dep. Dir. Zients] today released details of the final fiscal year (FY) 2012 budget results. The release shows the deficit in FY 2012 fell to $1.089 trillion, $207 billion less than the FY 2011 deficit and $238 billion less than forecast in President Obama’s February Budget.”
Friday’s update added that, “Outlays for the Department of Agriculture were $139.7 billion, $7.7 billion lower than the MSR [Mid-Session Review] estimate. Major differences from MSR estimates include:
“Outlays for the Farm Service Agency (FSA) were $1.2 billion lower than expected. The bulk of this difference was due to lower commodity marketing loan-making and higher loan repayments than anticipated, due to higher-than-estimated crop prices. Additionally, FSA paid out less in disaster assistance for 2010 crop losses and other disaster payments than anticipated in the MSR…[O]utlays in FY 2012 for the Food and Nutrition Service were $2.6 billion lower than estimated in MSR. The majority of this difference was due to lower-than-expected growth in the Child Nutrition free meals program.”
Meanwhile, Bloomberg writer Alan Bjerga reported on Thursday that, “Food-stamp overpayments have dropped to record lows even as the number of Americans receiving aid is at an all-time high, according to U.S. Department of Agriculture data.
“The BGOV Barometer shows the percentage of food-stamp payments that were above program guidelines fell to 2.99 percent in the year ended Sept. 30, 2011, the most recent available, according to the department. The overpayment rate was less than half what it was a decade earlier, while the number of recipients more than doubled to 44.7 million people on average in 2011.”
An article late last week at NBC-29 Television (Charlottesville, Va.) noted that, “Congressman Bob Goodlatte [R.Va.], who is vice-chairman of the House Agriculture Committee, blames the expiration [of the Farm Bill] mostly on disagreements over funding for nutritional programs. He’s confident the 2012 farm bill will be approved before the end of the year.”
In an article from Friday, Cullman Times (Ala.) writer Benjamin Bullard quoted House Ag. Comm. Chairman Frank Lucas (R., Okla.), who was speaking to a group of Alabama farmers last week, as saying: “‘There’s everything in a farm bill to impact rural America and production agriculture,’ [Lucas] said. ‘Not having a bill in place makes it more difficult for farmers, and their families, and their bankers, and their suppliers, to make decisions about what direction they need to go.’
“The near-term fate of farmers represents only part of a renewed farm bill’s significance for Americans, added Lucas.
“‘Remember: farm bills are, in addition to the commodity title — what many people think of as the corn program, or the cotton program, or the wheat program — they’re also the nutrition program. They cover school lunches, conservation and rural development, agricultural research, farm credit, and so on. Whether you live in rural America, are a farmer, or simply if you eat, it’s important — because it’s a consumer bill, too.’”
An update on Friday at the Democratic Leader Blog (Rep. Nancy Pelosi (D., Calif.)) indicated that, “On the House Floor today, Republican Congressman Scott DesJarlais, who served as Speaker Pro Tem, gaveled down the minutes-long pro forma session ‘…at the behest of Speaker John Boehner (R-Ohio).’
“Congressman [and House Ag. Comm. Member] Jim McGovern (D-Mass.), attempting to urge the Republican Congress to address the major issues of middle class Americans and seniors on jobs, middle class tax cuts, and avoiding the severe cuts imposed by the sequester, found a dead microphone at the lectern and was silenced by House Republicans.”
“House Democrats stand ready to act with real solutions to the issues facing the American people – creating jobs, extending middle class tax cuts, passing the bipartisan Farm bill…,” Friday’s update said.
And, the stalled Farm Bill has become an issue in some federal campaigns this year.
Reuters writer Nick Carey reported on Saturday that, “Democrats fighting an uphill battle to win a majority in the U.S. House of Representatives are trying to use rural angst over the failure of congressional Republicans to pass a farm bill to win some Midwestern seats in the November 6 election.”
The article pointed out that, “Democrats are focusing on the farm bill in Iowa, Wisconsin, South Dakota, Colorado and Illinois. It is also a major issue in close U.S. Senate races in Montana and North Dakota, where Republican House members are seeking seats held by Democrats.”
(For additional details on some of these elections, see this FarmPolicy update, Snapshot: An Election Year Farm Bill- Campaign Impacts.)
A National Journal (Hot Race Hotline) item from Friday pointed out that, “House Maj. Leader Eric Cantor stumped for state Rep. Lee Anderson (R) at a private fundraiser in an Atlanta suburb, saying Rep. John Barrow (D) ‘is out of touch with the district.’
“‘Meanwhile, Barrow blamed Cantor for holding up passage of legislation critical’ to the CD’s farmers.”
The update noted that, “Barrow, in a statement: ‘It’s too bad that Lee Anderson is campaigning with the one individual most responsible for preventing Congress from passing a farm bill. There is enough bipartisan support for the House to pass the bill, but it has never been allowed to come to the floor for a vote.’”
An article Saturday at Windsor Now (Greeley, Colo.) Online reported on the Colorado 4th Congressional District Race (Rep. Cory Gardner, GOP Incumbent vs. Brandon Shaffer (D)) and noted that: “‘It’s one thing to have to deal with the unpredictability of the weather, but you shouldn’t have to deal with the unpredictability of Congress, as well,’ Shaffer said. ‘On the farm bill, there was a procedure in the House of Representatives to force a vote on the farm bill and it’s called ‘a petition to discharge’ the bill. If you get the majority of the representatives to sign the petition to discharge a bill from a committee, you can force a vote on that bill in the committee in order to discharge it out to bring it to the floor of the House of Representatives. It’s important to note that Rep. Gardner refused to sign that petition to discharge. People need to know that he’s playing games with the farm bill.’”
Deborah Mcdermott reported on Saturday at SeaCoastOnline (Portsmouth, N.H.) that, “‘The House refused to bring up the [Farm] bill,’ she [House Ag. Comm. Member Chellie Pingree [D., Maine] said, adding several theories emerged for the decision. She said it was frustrating to Senate and House agriculture committee members who worked together on the bill.
“If it isn’t passed in the lame duck Congress, ‘very possibly, we would have to start all over again’ in the new session, she said.”
An update at the Pierce County Herald (Ellsworth, Wis.) Online (videos included) noted that Sen. Ag. Comm. Member Amy Klobuchar (D., Minn.) campaigned recently with Rep. Tammy Baldwin (D., Wis.), who is currently running for the U.S. Senate in the Badger state. The article noted that, “Klobuchar said when it comes to Washington D.C., ‘you need people to get things done’ and with Baldwin’s history in the last 13 years in the U.S. House of Representatives, she has proven that.
“Getting the Farm Bill passed, the Minnesota senator said, is the number one thing she wants to get done when she returns to Washington D.C.”
In other Senate campaign news, Chad Selweski reported on Saturday at the Daily Tribune (Mount Clemens, Mich.) Online that, “Embracing her new role as chair of the Senate Agriculture Committee, Sen. Debbie Stabenow hopes that her role in reforming farm subsidies and gaining political support from the farming community will help her win re-election in November.”
A recent poll showed that Chairwoman Stabenow maintains a lead in her re-election bid against former Rep. Pete Hoekstra (R), and Sen. Stabenow recently released a video highlighting agriculture (“Our Farm Jobs Tour!”). And yesterday, The Detroit Free Press endorsed Chairwoman Stabenow for re-election.
Meanwhile, House Ag. Comm. Chairman Lucas also recently released a campaign video that highlights broad themes of leadership and features several agricultural scenes, but does not specifically note farm policy issues.
With respect to the executive branch, an update on Friday at the Iowa Politics Blog (Des Moines Register) reported that, “Next week, President Barack Obama will make his ninth trip to Iowa this year, according to his campaign.”
Recall that GOP Pres. Nominee Mitt Romney was in Iowa last week and discussed farm policy issues.
The Des Moines Register editorial board noted yesterday that, “In Iowa last week, Republican presidential candidate Mitt Romney blamed the failure of Congress to pass a new farm bill on a lack of leadership from President Obama.
“How engaged the president has been on this legislation is a fair question, but the reason why it stalled has more to do with the fact that support in Congress for taxpayer subsidies to agriculture and food stamps has seriously eroded.”
The editorial added that, “It’s hard to see a fruitful discussion of these issues in a lame duck session of Congress. One option would be to extend the provisions of the old farm bill. Then the new Congress could have a larger discussion of U.S. food and nutrition policy. The first step would be to slice the bill in two to eliminate the distraction over food stamps from the farm bill debate.”
In other policy related news, Michael M. Grynbaum reported in Saturday’s New York Times that, “New York’s battle over big sodas is heading to the courtroom.
“The American soft-drink industry, joined by several New York restaurant and business groups, filed a lawsuit on Friday that aims to overturn restrictions, proposed by Mayor Michael R. Bloomberg and approved by the Board of Health, on sales of large sugary drinks at many dining locations in the city.”
And, Marc Lifsher reported in Friday’s Los Angeles Times that, “An advertising blitz against Proposition 37 has slashed support for the genetically engineered food labeling initiative on next month’s ballot and may endanger its prospects for voter approval, a new poll shows.
“Proposition 37, which once was ahead statewide by more than a 2-1 margin, still leads 48.3% to 40.2% in the poll released Thursday by the Pepperdine University School of Public Policy and the California Business Roundtable. Undecided voters accounted for 11.5%. But with 3 1/2 weeks left to go before the Nov. 6 election, pollsters now foresee a tightening race, as opponents continued a media blitz financed by $35 million in campaign contributions.”
Agricultural Economy –Animal Agriculture
Stacy Finz reported yesterday at the San Francisco Chronicle Online that, “The nation’s drought and high corn prices are devastating California’s $8 billion dairy industry to the point where farmers can’t afford to feed their cows – and their professional trade organization has been regularly referring despondent dairymen to suicide hotlines.
“Experts in the industry estimate that by year’s end California, the largest dairy state in the nation, will have lost more than 100 dairies to bankruptcies, foreclosures and sales. Milk cows are being slaughtered at the fastest rate in more than 25 years because farmers need to save on corn costs. According to the Western United Dairymen, a California trade group, three dairy farmers have committed suicide since 2009, despairing over losing their family’s dairies.”
Julie Harker reported on Friday at Brownfield Online that, “The Humane Society of the United States (HSUS) says the Cheesecake Factory chain of restaurants has announced it will eliminate pork suppliers that use gestation crates. That brings to 30 the list of national restaurants that have made such announcements.”
The AP reported on Saturday that, “The nation’s largest meat company, Tyson Foods, said on Friday that it was beginning a program to audit the way animals are treated on its suppliers’ farms.
“Tyson has been feeling pressure from animal welfare activists, who have urged the company to move away from cramped cages for pregnant pigs.”
And, Tiffany Hsu reported in yesterday’s Los Angeles Times that, “Scorching weather this summer in the Midwest left crops parched and livestock famished. Restaurants, already struggling with high fuel costs and a sluggish economy, are starting to feel the pinch of higher food costs…Now fast-food giants, fancy eateries and even corner coffee shops are scrambling to adjust. The cost of food rivals labor as the top expense for most restaurants. Restaurateurs are revamping menus, reducing portion sizes and even considering staff cuts. In the months to come, they say, watch for smaller steaks, fewer tortillas per entree and maybe even menu-wide price increases.”
David Shepardson reported on Friday at The Detroit News Online that, “The Environmental Protection Agency will decide by early next month whether to reduce the amount of corn-based ethanol used in the nation’s 240 million gas tanks because of this summer’s drought.”
Meanwhile, Matthew L. Wald reported on Friday’s New York Times that, “A Maryland man is awaiting sentencing for what may seem an unusual crime: selling bogus renewable energy credits and using the $9.3 million in illicit proceeds to buy jewelry and a fleet of luxury cars.
“In a similar case in Texas, a man has been indicted for selling a whopping $42 million in counterfeit credits. He bought real estate, a Bentley and a Gulfstream jet.
“As a result of such cases, the Environmental Protection Agency is scrambling to retool a program that relies on such credits to encourage the use of cleaner diesel fuel in engines. The refining industry has meanwhile seized on the schemes to argue that government fuel mandates don’t work and the rules should be relaxed or scrapped.”
CFTC (Commodity Futures Trading Commission) Issue
A news release Friday from Sen. Ag. Comm. Ranking Member Pat Roberts (R., Kan.) noted that Sen. Roberts released a statement on the implementation of the CFTC’s new ‘Swaps Definitions’ rules, in part the statement indicated that:
“‘On the heels of the federal district court’s decision to block the CFTC proposed ‘position limits’ rule on trades of derivatives and swaps, we brace ourselves for the results of new regulations meant to bring transparency to the market that have in reality brought confusion, concern and do not inspire confidence in the CFTC’s leadership. When the congress resumes session, the Senate Agriculture Committee should hold hearings to examine the consequences,’ Roberts said.
“‘Unfortunately, it’s my view that CFTC Chairman Gary Gensler is using his newfound power to unilaterally impose his will on financial markets. Most distressing is that while Mr. Gensler has tried to create his regulatory agenda, he and the CFTC have miserably failed in their oversight of existing regulations and market participants. First they missed MF Global and less than a year later we had the Peregrine debacle.”
Sen. Roberts noted that, “The White House and those in Congress who voted for the Dodd-Frank Act thought it would bring more transparency to the marketplace. What we now have is a dark curtain between the regulators and the oversight committees. In Chairman Gensler’s CFTC, there is a black-out curtain amongst the commissioners themselves. The President has tolerated the miss-steps at the CFTC for too long and this is the result. As this Congress comes to a close, it is clear that the next Congress must perform its oversight role and shine the light of transparency on the regulators themselves.”
The New York Times editorial board noted in today’s paper that, “The foes of Dodd-Frank financial reform scored a victory recently when a federal court overturned a new rule to limit speculative trading in derivatives.
“If allowed to stand, the ruling will leave the economy exposed to continued distortions because derivatives are easily deployed as tools for vast speculation. When the bets pay off, the result is lush bank profits. When they crater, as they did during the financial crisis, the result is bailouts. Either way, Wall Street wins and everyone else loses.”