FarmPolicy

September 20, 2019

Farm Bill; Immigration; Biofuels; Trade; and, MF Global

Farm Bill Issues

Reuters writer Charles Abbott reported yesterday that, “The Republican-controlled U.S. House of Representatives needs to solve its farm bill impasse by enacting the Senate’s bipartisan bill, Majority Leader Harry Reid said on Monday, warning that the Democrat-run Senate will not extend current law again.

“The House defeated its own farm bill last week – the first time such a bill has failed in a House vote – and analysts have said a short-term extension of the 2008 farm law would be the easiest solution.

“On the Senate floor, Reid said ‘the Senate will not pass another temporary farm bill extension.’”

(Note that a video replay of Sen. Reid’s presentation on the Senate floor, and transcript of his remarks, are available here,  at FarmPolicy.com Online.  See also this news release yesterday from Purdue University, “Second farm bill extension seems likely, Purdue ag economists say.”)

Mr. Abbott noted that, “A spokesman for House Majority Leader Eric Cantor said ‘no decisions have been made on next steps.’”

The Reuters article pointed out that, “House Republican leaders canceled plans for a vote this week on an Agriculture Department funding bill. One farm lobbyist said it would have been ‘round two’ on the farm bill since it covers the same contentious subjects.”

On the floor Thursday, before his dust up with Democratic Whip Steny Hoyer (D., Md.) over the Farm Bill vote, Majority Leader Eric Cantor (R., Va.) indicated that, “Finally, Mr. Speaker, I anticipate bringing to the floor H.R. 2410, the Agriculture appropriations bill authored by Representative Robert Aderholt of Alabama.”

More specifically on the Appropriations issue, David Rogers reported yesterday at Politico that, “Even after the loss [on the Farm Bill vote], Majority Leader Eric Cantor (R-Va.) had spoken confidently of turning next to the $19.45 billion measure which also funds the Food and Drug Administration and Commodity Futures Trading Commission. But House legislative notices no longer list the spending measure for this week’s floor schedule, and the GOP’s message machine has shifted to energy bills.

“The House Rules Committee is still slated to consider the Agriculture budget bill Tuesday evening — leaving open a slim chance of action before the July 4th recess. And when Rules meets, House Agriculture Committee Chairman Frank Lucas (R-Okla.) is expected to have objections to some of the legislated spending provisions in the appropriations bill.

“If Lucas were to insist on his points of order, it could force more cuts in a bill already about $1.3 billion below what Congress approved in March for the same accounts. But Republicans are candid to say the changed floor schedule is less about managing dollars than perceptions after the embarrassing defeat last week.”

Mr. Rogers added that, “On one hand, action would give the leadership a chance to show it hasn’t forgotten farmers entirely. On the other, there is a strong desire to change the subject, especially given Cantor’s role in the turmoil that led to the bill’s defeat.”

Meanwhile, House Budget Committee Chairman Paul Ryan (R., Wis.) appeared yesterday on the MSNBC “Morning Joe” program and discussed the Farm Bill.  A recap and video replay of this discussion has been posted at FarmPolicy.com Online.

Rep. Ryan reiterated accusations made by Majority Leader Cantor that Democrats failed to deliver the number of promised votes to pass the Farm Bill, while simultaneously omitting the variable that the Committee bill was being altered just prior to the final vote on the measure.

In addition, the former GOP vice-presidential candidate also made the argument that the commodity title and nutrition title should be separated and considered individually.

Emma Dumain and Matt Fuller reported yesterday at Roll Call Online that, “Speaker John A. Boehner plans to continue to allow freewheeling amendment debates on high-profile bills, despite last week’s farm bill meltdown.”

The article noted that, “Even at the outset of the farm bill debate, while Agriculture Chairman Frank D. Lucas of Oklahoma said the House would ‘work its will,’ Collin C. Peterson, the panel’s top Democrat, pleaded with his colleagues to keep the legislation bipartisan and ‘not stray too far from what was approved in committee.’

“Ultimately, at least two amendments on the House floor with little chance of becoming law — one stripping the bill of the dairy supply management program, the other adding more stringent work requirements for the food stamp program – rankled Democrats. Only 24 backed final passage.”

Yesterday’s article noted that, “‘They really poisoned the whole well for this bill,’ one Democratic leadership aide said Monday of the Republicans. ‘They decided it was a good idea to do these stupid amendments.’

Republicans continued to blame Democrats Monday for failing to deliver promised votes, and they said Democrats knew in advance that the controversial amendments were coming. ‘There were no surprises’ for Democrats, a Republican leadership aide said.”

Also, Ellyn Ferguson reported yesterday at Roll Call Online that, “House leaders must determine how they can pick up the pieces after a bipartisan rejection of a five-year farm bill backed by Speaker John A. Boehner.

“But some people who follow the farm bill, in the past an easily bipartisan piece of legislation, say there may be no easy fix.”

A news release yesterday from Sen. Heidi Heitkamp (D., N.D.) indicated that, “[Heitkamp] today called on the U.S. House of Representatives to try again to pass a long-term Farm Bill, or consider the Senate-passed version.”

Also, in a Bloomberg interview yesterday, Societe Generale Head of Agricultural Research Chris Narayan discussed the impact of the failure to pass the Farm Bill on Bloomberg Television’ ‘Market Makers’.  The brief interview was titled, “How Will Farm Bill Defeat Affect Food Prices?,” and can be viewed at FarmPolicy.com Online.

In other Farm Bill related news, a recent Bloomberg Government Study by Dr. Craig Jagger (craig.jagger@legis-consulting.com) provided an insightful discussion regarding various aspects of the Farm Bill.  Dr. Jagger consults on agricultural policy and budget issues after a 27-year government career.

The Bloomberg Government Study (BGov study), titled, “The Most Contentious and Difficult Farm Bill Ever?” was published earlier this month (June 14) and stated that: “This Bloomberg Government Study provides an overview of major issues in the farm bill and discusses the three main reasons that debate over the legislation — now in its fourth year — has been the most contentious and difficult in the long history of farm bills:

“- Republican House leaders wouldn’t let the 2012 House bill come to the floor, because of differing views among their members. Without House action, the two chambers couldn’t conference the bill and reconcile differences.

“- Budget rules and gimmicks used to increase funding in prior farm bills are no longer available. Instead, to add new programs or increase funding of existing ones, funding for other existing programs will need to be cut. The next farm bill also must reduce spending to contribute to deficit reduction.

“- Major policy differences need to be resolved, including approaches to the farm safety net, the size and nature of cuts to the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps) and how to craft a program for dairy farmers.”

After setting the table with a summary of the status of the Farm Bill debate, the BGov Study indicated that, “The CBO May 2013 baseline is the agriculture committees’ budget for the next 10 months. This baseline reflects the CBO’s best estimates of the total costs of current programs if they were to continue unchanged for the next 10 years…[C]hart 1 shows the CBO’s May 2013 10-year mandatory spending budget baseline for agriculture as well as the baseline after 2013 House and Senate farm bill reductions.  Discretionary funding isn’t included but sequestration reductions are. Sequestration requirements of the Budget Control Act of 2011 (BCA) reduce total 10-year outlays for the baseline and both proposals by $6.4 billion (outlays would be $6.4 billion higher without sequestration).”

Dr. Jagger pointed out that, “Chart 2 shows the latest available CBO cost estimates for the 2013 farm bills: S. 954, as ordered reported by the Senate Agriculture Committee on May 15, and H.R. 1947, as ordered reported by the House Agriculture Committee on May 15.  The total 10-year savings in the chart of $17.8 billion (Senate) and $33.3 billion (House) are only the outlay reductions resulting from farm bill changes; they do not include the $6.4 billion in outlay reductions resulting from BCA sequestration.”

The study explained that, “Budget rule changes and lost budget gimmicks constitute a second major reason that this has been the most contentious and difficult farm bill ever.

After the 1996 farm bill and until this farm bill, the agriculture committees have been able to add funding above the CBO baseline when they wrote major farm legislation. Before budget rules changed in 2007, the House and Senate Budget committees could simply add extra funding to the budget resolution. They added $6.5 billion above the CBO baseline over five years for the 2000 crop insurance reform bill and $73.5 billion above the CBO baseline over 10 years for the 2002 farm bill.

“With that budget resolution avenue closed for the 2008 farm bill, the agriculture committees, with leadership support, persuaded the Senate Finance and House Ways and Means committees to provide $10 billion in revenue offsets to be included in the farm bill, in return for getting some of their pet projects in the measure.”

Furthermore, the BGov Study stated that, “In addition, explicit timing shifts were used to capture ‘savings’ of $2.6 billion over 10 years for the 2002 farm bill and $4.5 billion over 10 years for the 2008 farm bill.  Timing shifts move costs outside the 10-year budget window. The CBO scores savings for the shifts even though only the timing, not the amount, of program costs change. Those explicit timing shifts are not available for the 2013 farm bill, because all that could be identified have been used and each timing shift can be used only once…When major program changes are being made, having extra money to make them more palatable to those losing benefits makes writing legislation easier. This farm bill process undoubtedly has been more contentious and difficult from not having extra money above its baseline that recent farm bills had. Now to add funding for a new program or to increase funding for an existing program, funding for a different Agriculture Committee program that has a baseline needs to be cut, robbing Peter to pay Paul.”

The BGov Study also noted that, “There are other reasons this farm bill is particularly challenging:

“- From a member’s perspective, reform and deficit reduction are not really compatible.

“- Increased partisanship makes compromise more difficult, especially outside the agriculture committees.

“- There are 37 programs/provisions with supporters that do not have budget baselines after 2012.

“- The farm economy, with some exceptions such as dairy, has generally been doing well. Not everyone understands that agricultural markets are cyclical and good can turn to bad very quickly.”

 

Immigration

Ashley Parker reported in today’s New York Times that, “The bipartisan push to overhaul the nation’s immigration laws took a major step forward Monday evening when the Senate endorsed a proposal to substantially bolster security along the nation’s southern borders as part of a measure that would provide a path to citizenship for 11 million undocumented immigrants already in the country.

“The 67-to-27 vote prevented any filibuster of the plan to devote roughly $40 billion over the next decade to border enforcement measures, including nearly doubling the number of border agents to 40,000 and completing 700 miles of fencing. Opponents of the measure questioned whether the security steps would ever be taken and said that the legislation should require that the border be secure before undocumented immigrants could seek legal status.

“But the solid bipartisan support for the border security proposal by two Republican senators, Bob Corker of Tennessee and John Hoeven of North Dakota, suggested that advocates of the overhaul had the votes needed to clear remaining hurdles and pass the legislation, which was drafted by a bipartisan ‘Gang of Eight’ senators, perhaps before lawmakers leave town for the July Fourth recess.”

The Times article explained that, “The Corker-Hoeven plan helped bring on board more than a dozen Republicans, many of whom said they were reluctant to support any immigration overhaul that did not secure the southern border and guard against a future wave of illegal immigrants. Their amendment will also require a $3.2 billion high-tech border surveillance plan — including drone aircraft and long-range thermal imaging cameras — as well as an electronic employment verification system and a visa entry/exit system at all air and sea ports.

“All those security measures must be in place before any undocumented immigrant can become a legal permanent resident and receive a green card.

“Any final bill passed by the Senate will head to the Republican-controlled House, where it already faces vocal opposition. Speaker John A. Boehner has publicly said that he will not bring any immigration bill up for a vote that does not have the support of a majority of House Republicans. That decision pleased the conservative wing of his caucus but also raises hurdles for any broad immigration bill in the House, where many Republicans oppose any pathway to citizenship.”

Kristina Peterson reported in today’s Wall Street Journal that, “The Senate voted 67-27 to advance the border-security plan, with 15 Republicans backing the measure and no Democrats opposing it. Monday’s vote showed growing momentum for the comprehensive immigration bill, if not a precise gauge of support. Travel delays prevented six senators from voting, including two Democrats expected to support the bill. While lawmakers credited the border-security amendment for picking up more GOP support for an immigration overhaul, several Republicans’ votes were expected to hinge on the fate of other amendments that could be addressed this week.”

The Journal article added that, “The vote on the broader immigration bill is set for Friday but could come a day earlier, depending on whether Democratic leaders and Republican opponents of the legislation can reach an agreement to wrap up debate ahead of schedule.

The immigration bill needs 60 votes to clear the Senate, but supporters are hoping for a more resounding victory, with as many as 70 votes, in order to pressure the more-conservative House to act. To build support, authors of the border-security measure included provisions aimed at resolving specific concerns of wavering lawmakers.”

Today’s article noted that, “Meanwhile, discussions continued over the bill’s provisions on agricultural workers, with the hope of securing support from Republicans from Southeastern states, among them Sens. Saxby Chambliss and Johnny Isakson of Georgia and Richard Burr of North Carolina.”

A statement yesterday on Senate Border Security Cloture Vote from the Agriculture Workforce Coalition indicated that: “The Senate’s cloture motion vote this afternoon represents an important step forward in the process of passing comprehensive immigration reform in that chamber. The Agriculture Workforce Coalition welcomes the strong bipartisan support shown today for S. 744, the Border Security, Economic Opportunity, and Immigration Modernization Act, and strongly encourages a similar vote for final passage later this week.

“The legislation includes agricultural provisions that reflect the agreement that the AWC and the United Farm Workers union reached earlier this spring. These provisions are vital to ensuring that America’s farmers and ranchers can find the workers they need to pick crops, prune trees or care for animals.

“Agriculture stands united in support of the agriculture provisions contained in the Senate bill and we are committed to working throughout the legislative process to ensure that agricultural producers have access to a legal, stable and productive workforce.”

Vicki Needham reported yesterday at The Hill’s On the Money Blog that, “The Senate is focused on completing a comprehensive immigration bill by the end of the week and July 4 recess, but probably not without a few bumps in the road.

“After meeting with business leaders to rally support, President Obama called on the upper chamber to pass a measure with the ‘strongest possible vote.’”

 

Biofuels

Zack Colman reported yesterday at The Hill’s Energy Blog that, “The Supreme Court on Monday declined to review a case that charged federal regulators allowed a mid-level ethanol fuel blend onto the market without proper testing.

The move preserves a space at the gas pump for E15 fuel, a mix comprised of 15 percent ethanol — compared with the standard 10 percent — and 85 percent petroleum by leaving intact a 2009 Environmental Protection Agency ruling that E15 is safe to use in cars made in 2001 or later.”

 

Trade

Vicki Needham reported yesterday at The Hill’s On the Money Blog that, “President Obama is ready to work with Congress to win fast-track trade negotiating authority, U.S. Trade Representative Michael Froman told The Hill on Monday in an exclusive interview.

“Froman said the negotiating authority ‘is a critical tool’ but doesn’t need to be in place when the U.S. begins talks with the European Union on a $5 trillion trade deal in two weeks.”

 

MF Global

Ben Protess reported yesterday at The New York Times Online that, “Federal regulators are poised to sue Jon S. Corzine over the collapse of MF Global and the brokerage firm’s misuse of customer money during its final days, a blowup that rattled Wall Street and cast a spotlight on Mr. Corzine, the former New Jersey governor who ran the firm until its bankruptcy in 2011.

“The Commodity Futures Trading Commission, the federal agency that regulated MF Global, plans to approve the lawsuit as soon as this week, according to law enforcement officials with knowledge of the case. In a rare move against a Wall Street executive, the agency has informed Mr. Corzine’s lawyers that it aims to file the civil case without offering him the opportunity to settle, setting up a legal battle that could drag on for years.

“Without directly linking Mr. Corzine to the disappearance of more than $1 billion in customer money, the trading commission will probably blame the chief executive for failing to prevent the breach at a lower rung of the firm, the law enforcement officials said. If found liable, he could face millions of dollars in fines and possibly a ban from trading commodities, jeopardizing his future on Wall Street.”

Keith Good

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