FarmPolicy

Farm Bill; Ag Economy; and, Biofuels

Farm Bill –Policy Issues, Political Notes

Andrew Lersten reported yesterday at The Herald Palladium (St. Joseph, Mich.) Online that, “U.S. Sen. Debbie Stabenow said she is very proud of her work to try to pass the federal 2012 Farm Bill in the U.S. Senate this year.

“But at a speech at the Van Buren County Farm Bureau’s annual banquet in Lawrence on Monday night, she warned that her efforts will be meaningless if the U.S. House of Representatives doesn’t pass the bill by year’s end.”

The article noted that, “She urged the Farm Bureau members to help convince the House to pass the bill.

“‘We’re kind of in limbo land right now,’ Stabenow said. ‘We need your help.’”

Yesterday’s article noted that, “The Lansing Democrat is seeking a new term in the Nov. 6 election and is being challenged by Republican Pete Hoekstra. The Michigan Farm Bureau last month endorsed Stabenow in the election.

“The website Real Clear Politics’ analysis of polling shows Stabenow 13 percentage points ahead of Hoekstra.”

Meanwhile, Pete Kasperowicz reported yesterday at The Hill’s Floor Action Blog that, “House Republicans on Tuesday afternoon kept up their practice of blocking Democratic attempts to call on the House to return to work.

“In a 2 p.m. pro forma session, Rep. Jaime Herrera Beutler (R-Wash.) quickly gaveled the session open, asked for a prayer and the pledge of allegiance, and then quickly gaveled the House closed until 10 a.m. Friday morning.”

The Hill update pointed out that, “Democrats have spent the last several weeks trying to seize time in the House to protest the early adjournment this year, which most members have used to work on their congressional campaigns. The decision by Republicans not to recognize Democrats to speak means none of their comments after the fact are reflected in the official record of Congress.”

And, the stalled Farm Bill continues to be an issue in federal election campaigns for the House and Senate.

Kayla Strayer reported earlier this week at the Worthington Daily Globe (Minn.) Online that, “One piece of legislation currently in the works is the Farm Bill, which would provide updates to the nation’s agriculture and wildlife policies.”

“‘We have to have smart policies, and that’s what these guys (talked about) today,’ [Rep. Tim Walz (D., Minn.- House Ag. Comm. Member)] said. ‘It’s my job to go back and get a Farm Bill done’…[W]alz said Minnesota outdoor sports generate a billion dollars a year in revenue, which trickles down to the local economy.”

The article indicated that Rep. Walz “hopes the [Farm] bill will be passed by February.”

Don Behm reported earlier this week at the Milwaukee Journal Sentinel Online that, “U.S. Rep. Reid Ribble, a Republican representing the 8th Congressional District in northeastern Wisconsin, and Jamie Wall, his opponent in the Nov. 6 election, agree with each other on one fundamental criticism of how politics is played out in Washington, D.C.: Too much partisan posturing and bickering has created legislative gridlock.”

The article noted that, “[Wall] blames Ribble, in part, for the failure by the House to pass a federal Farm Bill before Congress recessed for the November elections. The Senate adopted its version of the bill in June.

“Ribble is a member of the House Agriculture Committee and did not get the job done, according to Wall.”

The Journal Sentinel article added that, “Ribble voted for the bill in committee and said he is as frustrated as anyone that it did not get through the full Congress before the September recess.

“In an interview, Ribble blamed partisans on both sides of the aisle for the delay in the House. He expects a lame-duck session of Congress to pass the Farm Bill later this year before its programs expire.”

And in the North Dakota U.S. Senate race, the Associated Press reported earlier this week that, “Democratic Senate candidate Heidi Heitkamp on Monday questioned Rep. Rick Berg’s ability to fulfill a promise to help break Washington gridlock, noting he failed to get Republican leaders to hold a pre-election vote on farm legislation crucial to North Dakota.

“In a debate recorded Monday for later broadcast on Prairie Public’s North Dakota television and radio network, Heitkamp criticized what she said was Berg’s ineffectiveness in advocating for a new five-year farm bill.”

The AP article stated that, “Berg is trying to move to the Senate after serving one term as North Dakota’s lone U.S. House member. He described Heitkamp’s criticism as ‘simply not accurate’ and said he has pushed repeatedly for a pre-election vote, including supporting a ‘discharge petition’ that would compel a floor vote on the legislation…‘I am doing everything I can, and I will continue to do what I can, to get this farm bill passed, because it is important to North Dakota,’ [Rep. Berg] said.”

For a more detailed look at how the stalled Farm Bill is impacting some key Congressional and Senate races, see this FarmPolicy post: “Snapshot: An Election Year Farm Bill- Campaign Impacts.”

Jennifer Steinhauer reported in today’s New York Times that, “As the sun fell behind a nearby barn, Representatives Tom Latham and Leonard L. Boswell nipped at each other with unconcealed disdain begotten by months of negative advertisements and campaign miles.

“The setting, a tiny radio station situated more or less in an open field, could not have felt farther from Washington and the race for the presidency.

“But the two men, locked in one of the hardest-fought House races in the country, are finding their campaign inextricably tied to the race for the White House as Iowa emerges as one of the most contested states between Mitt Romney and President Obama. Just last week, Mr. Latham, a Republican, appeared with Mr. Romney at a rally near Van Meter, Iowa, and former President Bill Clinton came to Des Moines to stump for Mr. Boswell, a Democrat.”

The article added that, “Mr. Latham also tries to blame the White House for the stalemate over the farm bill, which House Republicans have refused to bring to the floor, saying that the administration has ‘not said a word on what their position is’ on the bill. Mr. Boswell will happily campaign with anyone from the administration, which some Democrats avoid.”

Coinciding with the observations in the New York Times article, that Iowa is now one of “the most contested” states in the presidential election, Howard Berkes reported on yesterday’s Morning Edition National Public Radio program that, “As Mitt Romney and President Obama get ready for their second debate, a new bipartisan survey shows a surge for Romney in a key voter group following their first debate Oct. 3.

“The random cellphone and land line poll of 600 likely rural voters in nine battleground states Oct. 9-11 has Romney at 59 percent among the survey’s respondents. Obama’s support is now down to 37 percent among rural battleground voters, a plunge of 10 points from the actual rural vote in those states four years ago.”

Mr. Berkes noted that, “‘Mitt Romney really needs to be at 60 percent or above in [rural] areas to offset some of those [urban and suburban] margins,’ [Dan Judy of North Star Opinion Research, the Republican polling firm that participated in the survey] adds. The new survey shows ‘he has surged into a huge lead, and I think it is fair to say that his increased lead among rural voters is what is helping him in these swing states overall.’

“The nine battleground states of Colorado, Florida, Iowa, Nevada, New Hampshire, North Carolina, Ohio, Virginia and Wisconsin have a collective rural population of 13.6 million, according to the Census Bureau.”

According to The Almanac of American Politics (2012), Iowa’s population is 60.3% urban and 39.7% rural.

With this background in mind, Jennifer Jacobs reported last night at The Des Moines Register Online that, President Obama “is making Iowa his first post-debate destination today.”

Ms. Jacobs also noted yesterday at The Des Moines Register Online that, “U.S. House speaker John Boehner will campaign in the Iowa City area tomorrow for GOP presidential candidate Mitt Romney, campaign aides said this morning.”

Bloomberg writer David J. Lynch reported yesterday that, “Obama and Romney were deadlocked at 48 percent apiece in a survey of 600 likely Iowa voters conducted Oct. 11-14 by Manchester, New Hampshire-based American Research Group Inc. The margin of error was plus or minus 4 percentage points…[F]arm income, even after a severe drought, remains strong. Soybean prices are up almost 25 percent this year and corn has risen about 14 percent.”

The article noted that, “Farmers are small businessmen, too, and the president has had trouble wooing that group.”

Also yesterday, Sec. of Agriculture Tom Vilsack appeared on a local Iowa television station as a representative of the “Obama for America” campaign and discussed presidential politics before last night’s debate.  A video reply of Sec. Vilsack’s interview is available here.

With respect to policy implications of the stalled Farm Bill, the dairy sector continues to be a point of focus in recent news articles.

Tom Lawrence reported yesterday at The Daily Republic (Mitchell, S.D.) Online that, “The stalled farm bill may cost small dairy farmers in the state hundreds of thousands of dollars in lost government subsidy payments, and it could double the cost of a gallon of milk in stores.

“The Milk Income Loss Contract program ended Sept. 30. It was a safety net providing payments when national milk prices drop in contrast to feed costs. When the new farm bill did not pass this year, and the old one expired, the MILC program halted and was not replaced.”

Ashley Gebb reported earlier this week at the Appeal-Democrat (Marysville, Calif.) Online that, “Five years ago, California was home to 2,200 dairies. In January, that number was down to 1,650 and has since fallen to 1,500.”

And, Bloomberg writers Tony C. Dreibus and Elizabeth Campbell reported yesterday that, “Retail-milk prices will rise as much as 15 percent by the first quarter of 2013 after the worst U.S. drought since 1956 sent livestock-feed costs to a record, according to Dairy Management Inc., an industry group.

“‘Since the drought started, the milk price has gone up quite a bit,’ Dairy Management Chief Executive Officer Tom Gallagher said yesterday during an interview in Chicago. ‘Prices are going to go up worldwide.’

“The drought led to the biggest U.S. drop in corn production in 17 years, sending the price of the main feed ingredient for dairies to an all-time high on Aug. 10 of $8.49 a bushel. Prices are up 47 percent since mid-June, forcing some California dairies into bankruptcy, while others cut their herds and output to limit losses.”

Meanwhile, in other developments, Sen. Tom Coburn (R., Okla.) took a critical look at some aspects of the SNAP program (food stamps) in a release this week he called “Wastebook 2012.”

In part, the report stated that, “However, lax controls and mismanagement resulted in billions of dollars being spent not on healthy meals for hungry kids but instead wasted on questionable and, in some cases, illegal expenditures. Approximately $2.5 billion in improper SNAP payments are projected to be made this year, while millions of dollars more will be misspent on silly promotional activities and food with little nutritional value” (pages 10-11 of report).

Recall that Bloomberg news reported last week 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.”

In other news, the Government Accountability Office (GAO) released an update yesterday (“Rural Water Infrastructure: Additional Coordination Can Help Avoid Potentially Duplicative Application Requirements”) which noted that, “Funding for rural water and wastewater infrastructure is fragmented across the three federal programs GAO reviewed, leading to program overlap and possible duplication of effort when communities apply for funding from these programs.”

And in the area of animal production, the United Egg Producers recently released an educational video highlighting the enriched colony housing units for egg-laying hens.  For more information on a bill introduced in Congress that would amend the Egg Products Inspection Act, and make important animal welfare improvements for egg-laying hens, just click here.

Agricultural Economy

Marcia Zarley Taylor reported yesterday at DTN’s Minding Ag’s Business Blog that, “Farmland, farm equipment and grain bins are often perceived as must-have items when farmers hit a profit streak. But after celebrating one year of excess spending in 2008, growers adopted more conservative buying habits, a new study by the financial consulting firm AgriSolutions found.

“Starting in the 2008 crop year, 100 growers randomly selected from the AgriSolutions database spent $24 million on three types of capital improvements–land, machinery and buildings/improvements like bins and drainage tile. By the 2011 crop, this annual investment budget had grown to $34 million but was much less reliant on credit.

“What’s key is that growers’ ability to pay with cash profits grew even faster than their outlays, thanks to record commodity prices and profit margins, says AgriSolutions financial consultant Sam Bachman. His conclusion: Growers have actually been better at living within their means.”

University of Illinois Agricultural Economist Gary Schnitkey penned an update yesterday at the farmdoc daily Blog that provided analysis on cash rents, “Cash Rents Given Differing Price Levels,” and the USDA’s Economic Research Service provided a more detailed look at recent production projections in the October Feed Outlook report, which was released earlier this week.

Biofuels

Bloomberg writer Karen Gullo reported yesterday that, “California’s low-carbon fuel standard, which complements the state’s first-in-the-nation economy-wide cap and trade program, appears to favor in-state fuel producers over Midwest ethanol makers, two U.S. appeals court judges said.

“Two members of a three-judge panel questioned state lawyers today about why the standard is tougher on ethanol produced in the Midwest and whether California’s method of assessing a higher ‘carbon-intensity’ for Midwest ethanol because of the energy expended to make and then transport it to California was unfair to out of state producers.”

The article noted that, “California’s low carbon fuel standard and other elements of its cap and trade program are facing court challenges as the state gets ready to hold its first auction of carbon allowances next month. The State Air Resources Board on Nov. 14 will auction at least 21.8 million allowances to be used during the first compliance phase of the cap-and-trade program.”

Keith Good

Posted by Keith Good • October, 17, 2012 • 4:15 am