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Farm Bill; Budget; Ag Economy; Trade; and, Regulations

Farm Bill Issues

Leonard N. Fleming noted on Friday at The Detroit News Online that after her 58 percent to 38 percent victory on Tuesday, Senate Agriculture Committee Chairwoman Debbie Stabenow (D., Mich.) indicated that: “Now it’s just back to work.”

“One of her first priorities is to get the farm bill through the House,” Friday’s article said.

Mr. Fleming quoted Chairwoman Stabenow as saying, “‘I’m very hopeful going back next week that we will be able to get the attention of the leadership in the House to get the farm bill done because we’re running out of time.  As of the beginning of January, we have serious consequences that will start. Milk prices going up and other things.”

In a statement released on Friday, Chairwoman Stabenow noted that, “Americans could not be more clear that now that the election is over, they want us to work together to create jobs and reduce the deficit. If Congress can work together to pass the Farm Bill, it will create the trust and momentum we need to overcome gridlock and solve the challenges our country faces. Passing a bipartisan Farm Bill that reduces the deficit by $23 billion is a significant first step in meeting the critical deficit reduction challenges our country must face head-on this year.”

Rep. Tim Walz (D., Minn.- Ag. Comm.), Rep. Jim Costa (D., Calif.- Ag. Comm.), Rep. Randy Neugebauer (R., Tex- Ag. Comm.) and, Rep. Jim McGovern (D., Mass.- Ag. Comm.) have all recently drawn attention to the importance of passing a Farm Bill.

And Friday’s Des Moines Register included remarks from Iowa lawmakers on the Farm Bill and the lame-duck session of Congress:

– Sen. Chuck Grassley (R- Ag. Comm.), “One of two things has got to happen: Either a one-year extension of the existing farm bill, or a five-year. And it’d be a lot better to have a five-year farm bill.”

– Sen. Tom Harkin (D- Ag. Comm.), “Harkin said the current lame-duck Congress should be able to pass a compromise farm bill without the deep cuts Republican House members have proposed to food stamps and other supplementary food programs.”

– Rep. Bruce Braley (D)- “Braley said he hopes Congress will pass a five-year extension of the farm bill now that the election is over. House Speaker John Boehner didn’t allow the bill to be voted on before Tuesday, but Braley said he thinks a deal can now be completed.”

– Rep. Steve King (R- Ag. Comm.)- “King said there is a ‘reasonable chance’ of passing a farm bill in the lame-duck session…‘There is nothing to be gained by waiting until after the first of the year because we don’t get much of a change in the configuration of the House or the Senate.’”

– Rep. Tom Latham (R)- “There’s wide agreement on the ‘basic principles’ of the farm bill, Latham said, but disagreements persist on the level of funding for the food stamp program and a few other issues. With the political season now over, though, he expressed hope that those disagreements could be bridged.”

– Rep. Dave Loebsack (D)- “He declined to say what he wants to see in the final version of the farm bill, but said it’s critical that House Speaker Boehner bring the bill to the floor for debate. He did say efficiencies could be found in supplementary food programs, such as food stamps, which make up a large portion of the USDA budget. Loebsack said success by Democrats and more moderate Republicans in the elections could also break the influence tea party members have had recently, particularly on issues like the farm bill.”

In addition, Rep. Reid Ribble (R., Wis. –Ag. Comm.) recently noted that, “There are savings in the Farm Bill that will be needed to offset some of things requires to put sequestration aside, and my guess is they’re going to use some of the savings in the Farm Bill to get toward that end.”

Meanwhile, the AP reported on Saturday that, “A farm bill that stalled in Congress before the election could see quick action by the end of the year if congressional leaders decide they need its spending cuts — including a small reduction in the $80-billion-a-year food stamps program — to make a deal for averting the ‘fiscal cliff.’”

Doug Heye, a spokesman for House Majority Leader Eric Cantor, said no decisions have been made on how to move the farm bill or whether it will be part of the fiscal negotiations. The 2008 farm bill expired Sept. 30, so Congress at a minimum will have to extend parts of it into next year;” the AP article said, while adding that, “Retiring Sen. Kent Conrad, D-N.D., said he has already started working on a compromise farm bill in an effort to move it alongside deficit reduction. Conrad, who chairs the Senate Budget Committee and sits on the Agriculture Committee, said he spent part of Congress’ election recess consulting with Senate and House aides who worked on the legislation.”

Saturday’s article pointed out that, “Conrad said he has attempted to ‘take some sort of reasonable difference’ between the House and Senate bills but would not provide details. He argues that next year’s budget will be even worse and farm-state legislators will be forced to make even deeper cuts.

“‘Time is not on our side,’ he said. Next year’s budget situation on farm programs will be ‘a big mess and it’s infinitely better for everyone to get these decisions made now.’”

Ben Weyl reported yesterday at Roll Call Online that, “Congress has a daunting list of other unfinished business…Farm state lawmakers are still hoping to pass multi-year legislation to reauthorize the country’s agricultural programs.”

In more specific policy ramifications of a stalled Farm Bill, Nancy Bean Foster reported on Friday at the Union Leader (Manchester, New Hampshire) Online that, “The failure of Congress to pass a farm bill before the last session ended in Washington has left some dairy farmers in New Hampshire short on cash at a time when costs to produce milk are going higher, and there doesn’t appear to be any immediate help coming…‘We are so frustrated with the lack of passage of a farm bill,’ said Beth Hodge, owner of Echo Farm in Hinsdale.”

Michael T. Scuse, Under Secretary for Farm and Foreign Agricultural Services at USDA, was a guest on Friday’s AgriTalk radio program with Mike Adams where a portion of the conversation turned to Farm Bill and budgetary issues, as well as the time and resources it takes for USDA to implement a Farm Bill.

Under Sec. Scuse pointed out (related audio here, (MP3- 3:36) that, “If we don’t get a Farm Bill very soon, it will have a major impact on our marketing programs.  With the expiration of the 2008 Farm Bill, we lost our Market Access Program and we lost our Foreign Market Development Program.”


Budget Issues

Carol E. Lee and Janet Hook reported in Saturday’s Wall Street Journal that, “President Barack Obama [video] and House Speaker John Boehner [video] signaled Friday a willingness to compromise on tax positions that have led to a budget stalemate, in a bid to defuse partisan tensions before talks next week to avert a year-end fiscal crisis.

“Mr. Obama invited Republican and Democratic congressional leaders to the White House next Friday to discuss how to avoid the so-called fiscal cliff, the combination of big tax increases and spending cuts scheduled to begin Jan. 1.”

The Journal article noted that, “White House press secretary Jay Carney, responding to questions after the president spoke, said Mr. Obama would veto any legislation that extends the Bush-era tax cuts for the top 2% of American income earners. At the same time, he didn’t rule out extending the rates if they were linked to raising revenue from wealthy people by eliminating deductions.

“Mr. Boehner responded to the president’s statement by accepting the invitation to the White House meeting.

“He reiterated his opposition to the Senate bill that would extend middle-income rates while allowing top rates to rise. He said he maintained a measure of hope that a wide-ranging deal was possible.”

Helene Cooper and Jonathan Weisman reported in Saturday’s New York Times that, “The president and Mr. Boehner were careful with their language and left room for compromise despite their fundamental differences about shifting more of the tax burden to high-income Americans. Mr. Boehner would not be very specific on what his goal might be for raising new federal tax dollars.”

Jonathan Weisman reported in yesterday’s New York Times that, “With President Obama re-elected and Democrats cementing control of the Senate, Mr. Boehner will need to capitalize on the chastened faction of the House G.O.P. that wants to cut a deal to avert sudden tax increases and across-the-board spending cuts in January that could send the economy back into recession. After spending two years marooned between the will of his loud and fractious members and the Democratic Senate majority, the speaker is trying to assert control, and many members seem to be offering support.”

Dan Friedman reported yesterday at National Journal Online that, “Lawmakers from both parties said on Sunday that Republicans’ willingness to accept new tax revenue from the elimination of some tax deductions could form the basis for an agreement to avert the so-called ‘fiscal cliff’ of budget cuts and tax increases scheduled for January.

“But lawmakers differed on the necessary components and even the timing of such an agreement.”

Yesterday’s update pointed out that, “Senate Budget Committee Chairman Kent Conrad, D-N.D., said [yesterday on Fox News Sunday] he believed a deal can be reached during the lame duck session. But Conrad suggested a partial solution under which lawmakers agree to a down payment on the deficit; task committees of jurisdiction with finding new cuts; and impose a ‘backstop’ of deeper reductions later if the panels don’t produce an agreement. That is an approach worked on by the ‘Gang of Eight’ senators, including Conrad, who are drafting a plan based on the conclusions of the Simpson-Bowles Commission commissioned in 2010 by the president to address fiscal issues.

“‘You can’t deal with every detail in a few weeks,’ Conrad said.

“Conrad , who is retiring after the lame-duck session, said better-designed cuts than those scheduled for implementation would create a more effective backstop.”

Note that Annie Lowrey reported in Friday’s New York Times that, “Come January, should Congress fail to act, the United States will face more than immense tax increases and spending cuts. It will also run out of room to finance its large running deficits.

“The Treasury Department expects the country to hit its debt ceiling, a legal limit on the amount the government is allowed to borrow, close to the end of the year. That would give Congress only a matter of weeks to raise the ceiling, now about $16.4 trillion, before sending financial markets into a panic.

Congressional leaders have made clear that the debt ceiling will be part of the intense negotiations over the so-called fiscal cliff, with many members unwilling to raise the ceiling without a broader deal. That has raised financial analysts’ worries of a financial market panic over the ceiling in addition to the slow bleed of the tax increases and spending cuts.”

Lori Montgomery reported in today’s Washington Post that, “Still, as they prepare to launch a fresh round of talks Friday at the White House, Boehner and Obama both have delivered nuanced public statements that seem to leave the door open to the historic ‘grand bargain’ both men are said to desire.

Boehner’s offer last week to raise revenue through tax reform ‘was a positive sign,’ Obama senior campaign adviser David Axelrod said Sunday on CBS’s ‘Face the Nation.’”

And Damian Paletta and Janet Hook reported in today’s Wall Street Journal that, “The White House plans an aggressive public campaign to build support for its approach to reduce the deficit through tax increases and spending cuts, a sharp contrast to its private talks with Republicans that faltered last year.

“President Barack Obama will meet with labor leaders Tuesday and a number of chief executives on Wednesday, in an effort to solidify backing for his proposals.”


Agricultural Economy

Gregory Meyer reported on Saturday at The Financial Times Online that, “Grain markets came under pressure after closely followed government forecasters [summary here] increased estimates of the size of this year’s drought-battered US corn and soyabean crops.

“The US is the leading corn producer and exporter and rivals Brazil in soyabeans. Both crops suffered as extreme heat and dry skies hovered over its midwest farming region this past summer, and harvests are expected to be the smallest in years. The poultry and livestock industries need the crops for feed.

“The US Department of Agriculture on Friday delivered slightly rosier production numbers, raising its soyabean harvest estimate 4 per cent from last month to 2.97bn bushels and increasing the corn estimate to 10.7bn bushels.”

The FT article added that, “‘For the most part, today’s [Friday’s] USDA reports were negative for crop prices – more so for soyabeans and less for corn and wheat,’ wrote Darrel Good, an agricultural economist at the University of Illinois, in a note.

“Soyabeans and corn have declined from all-time highs reached in the heat of summer but remain up 22 per cent and 15 per cent this year, respectively. The USDA still expects farmers to obtain record prices for both crops, a cost that is expected to pass through to meat prices next year.”



Pete Kasperowicz reported on Friday at The Hill’s Floor Action Blog that, “The House next week is expected to pass legislation that would give Russia permanent normal trade relations (PNTR) status, which would allow the United States to benefit from Russia’s August accession to the World Trade Organization (WTO).

“The House Rules Committee announced Friday that it will hold a meeting on Tuesday to approve a rule that governs floor consideration of the bill, H.R. 6156. That implies that the House will start work on the bipartisan measure as early as Wednesday, and complete it by the end of the week.”

The American Soybean Association, and business groups have expressed support for granting PNTR to Russia.

Reuters news reported on Friday that, “The United States will challenge Thailand over its rice subsidies at a World Trade Organization committee meeting next week, fearful that a government-sponsored crop could land up on the world market and depress prices, hurting U.S. exporters.”

Martin Fackler reported in yesterday’s New York Times that, “In a possible gambit to reverse his governing party’s flagging fortunes, Prime Minister Yoshihiko Noda appears likely to declare Japan’s intent to join an ambitious pan-Pacific free trade agreement, then call a snap election in which the party would campaign on that move.

“Major newspapers said on Saturday that support was building in the Noda administration to announce Japan’s entry into the proposed American-led regional agreement sometime in the next two months. The reports said that move would be immediately followed by a decision to dissolve Parliament for national elections that would take place a month later.

“Japan has long wavered on entry into the pact, the Trans-Pacific Partnership, which is opposed by the nation’s heavily protected farmers but supported by consumers and industry groups. Because the reports about the government’s intentions appeared in most major newspapers, it suggested Mr. Noda’s Democratic Party had made a concerted effort to begin signaling a change in strategy.”

And, Joshua Chaffin reported on Friday at The Financial Times Online that, “Europe’s top trade official has called for the EU and US to launch negotiations for a comprehensive bilateral trade agreement ‘as soon as possible’, giving fresh impetus to a transatlantic initiative that has languished for years.

“Three days after Barack Obama’s re-election as US president, Karel De Gucht, the EU trade commissioner, presented such a deal as a way for both sides to generate much-needed economic growth while re-energising a relationship that has suffered from drift and indifference.”



Dina ElBoghdady reported late last week at The Washington Post Online that, “A battle is brewing in the Senate over a measure that would force independent agencies to more fully consider the costs of new regulations, a plan that critics say is designed to derail key federal initiatives.

“The drama unfolding in the Senate mirrors a similar one taking place in the courts, where regulators face numerous lawsuits alleging that they failed to properly consider the economic impact of rules tied to the landmark Dodd-Frank financial overhaul measure, which was put in place after the 2008 financial crisis.

Opponents of the Senate measure say the legislation will paralyze the agencies and make them more vulnerable to legal challenges. But supporters say it will have the opposite effect, forcing regulators to craft airtight justifications for their actions.”

Keith Good