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Farm Bill; Ag Economy; CFTC; and, Immigration

Farm Bill

Robert Costa reported yesterday at National Review Online that, “In a tense, closed-door meeting today at the Capitol, House majority leader Eric Cantor (R., Va.) scolded several Republican committee chairmen for voting against the farm bill, which failed to pass the House last month.

“According to several sources, Cantor told the chairmen it was ‘unacceptable’ for them to not vote together on final passage, especially since the leadership supported their amendments to the agricultural package.

“Representative Frank Lucas of Oklahoma, the agricultural committee chairmen, expressed hope that the House would take up a farm bill again this summer, and Cantor reportedly agreed with him. The majority leader went on to tell the group that he doesn’t want another headache if he does that.”

Mr. Costa added that, “Near the end, Cantor coolly reminded them that the leadership is much more likely to usher their bills to the floor if they stick with him on votes.

“Sources say the chairmen were slightly surprised to hear such a warning from the mild-mannered Virginian. But with rank-and-file Republicans angry about the farm bill’s collapse, they know Cantor is facing pressure.”

Jerry Hagstrom reported yesterday at National Journal Online that, “How the House Republican leadership tries to salvage the failed farm bill is becoming a test of the leadership of House Speaker John Boehner, R-Ohio, and it will also pit the power of the farmers and antihunger activists against the conservative groups that want to dismantle both the farm and food-stamp programs.

But the real political and policy issue is whether House members have become more responsive to national conservative groups than to farmers and antihunger advocates in their own districts who know the importance of the farm bill to a major industry and to providing food to jobless and low-paid people.”

Mr. Hagstrom pointed out that, “But even if the farm bill is split in two, it looks like Heritage and the Club for Growth would still recommend that members vote against it, because they object to the underlying programs. Heritage said in a memo that its six principles for farm-bill reform are separating food stamps from the farm program, turning food stamps into a ‘work activation’ program, adding no new farm programs, avoiding any increase in the cost of crop insurance, capping premium subsidies, and repealing the sugar and dairy programs on the grounds that they raise food prices. Since there is no way that a single farm bill or two bills will contain all those provisions, there seems no possibility that lawmakers who vote for the farm bill can get relief from a barrage of conservative criticism.”

Yesterday on the AgriTalk radio program with Mike Adams, Mary Kay Thatcher, the Senior Director of Congressional Relations for the American Farm Bureau Federation, discussed larger themes and realities regarding the political climate in Congress.

Ms. Thatcher indicated that, “[T]he problem continues to be that we have fewer and fewer really competitive congressional districts in this country, and so the people who are in a very Republican district fear that someone more to the right of them might run against them in a primary, and therefore they’ve got to be really careful about A– big, big cuts in food stamps or B– do I go too far on immigration, so it’s the same issue, I think.”

She added that, “You know, if my memory serves me, we probably only have 45 or 50 districts out of the 435 that are truly competitive between Democrat and Republicans now, so the Democrats worry about are they liberal enough, or is somebody more liberal going to run against them in a primary, and the Republicans worry about someone more conservative running against them in the primary, and I think it drives a lot of their votes.  They’re not really worried about the general election anymore.”

With respect to more immediate prospects on the Farm Bill, Ms. Thatcher stated yesterday on AgriTalk that, “I think what we’re looking for is the first person that comes to Speaker Boehner with an idea that is viable on how they get to 218 votes, that’s what they will bring to the floor.  It could be this week, it could be the end of the month.  Certainly that’s what the leadership is aiming for.  It could be November.”

Ms. Thatcher also reminded listeners that, “What we forget when we do this is we not only have to pass the House now, but we have to then go to conference and come back and pass both the Senate and the House with that conferenced bill.  It’s more than one step to be considered.”

Greg Sargent noted yesterday at The Plum Line Blog (Washington Post) that, “On the farm bill, the collapse of the measure already shows that Boehner can’t count on conservative support even for bills that contain major concessions to them (such as the farm bill’s $20 billion in cuts to food stamps). The response from conservatives will be to insist on still more spending cuts in the bill.”

An update posted yesterday at the Heritage Foundation Online stated that, “[Rep. Marlin Stutzman (R., Ind.)] a fourth-generation farmer from Indiana, will speak at The Bloggers Briefing on Tuesday [today] about his #SplitTheBill campaign. The Bloggers Briefing begins at 11:30 a.m. ET and will be broadcast on Livestream.”

Meanwhile, Carol Stender reported yesterday at The Post-Bulletin (Rochester, Minn.) Online that, “Seventh District congressman Collin Peterson said it’s ‘probably not a good idea’ to attempt to pass a farm bill by splitting it from food nutrition legislation.

“Republican friends have told him their party has decided to propose the split.

“Peterson, speaking at a farm bill and ag issues forum, hosted by Eighth District congressman Rick Nolan, said the Senate might not agree to the split.”

Ms. Stender added that, “Keeping food, nutrition and the farm program together has worked well, Peterson said. He’s concerned that separating them might cause deeper cuts in the farm program.”

The Post-Bulletin article indicated that, “‘Cantor has been pushing to have a partisan bill that has no Democrats voting for it,’ he said. ‘We told him we didn’t think that would work.’

For the first time in his 23 years in the House, Peterson said he has no idea what will happen.

“‘This is the first time that I’ve ever said that in my career,’ he said. ‘… And I don’t think the Republicans have any idea, either. It’s a mess.’”

An item yesterday by Sarah McCammon on the Marketplace Morning Report (“Food stamps may be cut from new farm bill”) stated that, “‘There’s a level of co-dependency on each policy,’ says Rep. Steve King of Iowa (R-Iowa), who voted for the farm bill. ‘It requires the people from the cities, and primarily the inner cities, to support some kind of ag policy if they’re going to get their nutrition piece, and vice versa.’”

The Report added that, “‘It’s been a marriage that’s worked quite well and we don’t want to see it split,’ says Mary Kay Thatcher with the American Farm Bureau Federation.”

Ken Anderson reported yesterday at Brownfield that, “Although the idea of splitting the farm bill into separate bills for farm and nutrition programs seems to be gaining support, it’s not a realistic long-term solution.

“So says University of Nebraska Extension public policy specialist Brad Lubben.”

Mr. Anderson indicated that, “‘There’s a reason farm and food came together some 40 years ago,’ Lubben says, ‘because it got the coalition of support to consider farm legislation that already then was recognizing a diminishing presence.’”

“‘You’ve got redistricting and gerrymandered districts that have become more politically polarized, such that you have fewer and fewer districts that really bridge the rural-urban divide,’ [Lubben] says. ‘So who are you going to find to push legislation in the House relative to farm and farm-related programs?’”

The Brownfield link included a replay of an interview with Dr. Lubben.

Brett Neely reported yesterday at Minnesota Public Radio (MPR) Online that, “For decades, Congress rolled food stamps and farm subsidies together into one giant bill. The tactic generated lots of rural and urban votes from politicians in both parties. Everyone got something out of the deal.

“That longtime marriage, though, is in trouble. With federal money tight, old alliances are starting to fray.”

The MPR item noted that, “Former U.S. Agriculture Secretary Dan Glickman and other observers say each of the commodity groups has been too busy trying to get their own best deal to see the big picture.

“‘The agriculture groups need to be working as a team rather than dairy working dairy, sugar working sugar and corn working corn,’ Glickman said.”

Meanwhile, Phil Izzo reported yesterday at The Real Time Economics Blog (The Wall Street Journal) that, “Food-stamp use rose 2.8% in the U.S. in April from a year earlier, with more than 15% of the U.S. population receiving benefits. (See an interactive map with data on use since 1990.)

“One of the federal government’s biggest social welfare programs, which expanded when the economy convulsed, isn’t shrinking back alongside the recovery.

“Food stamp rolls increased on a year-over-year basis, but were 0.4% lower from the prior month, the U.S. Department of Agriculture reported. Though annual growth continues, the pace has slowed since the depths of the recession.”

The Journal item added that, “Mississippi was the state with the largest share of its population relying on food stamps — 22% — though Washington, DC was a bit higher overall at 23%.”

Also with respect to nutrition, Julian Hattem reported yesterday at The Hill’s RegWatch Blog that, “The Obama administration wants to add Greek yogurt to school lunch menus.

“On Monday, the Department of Agriculture announced it was looking to buy the yogurt for schools participating in a federally assisted program that subsidizes school lunches.”

 

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In a look at Senate activity related to the Farm Bill, Ramsey Cox reported yesterday at The Hill’s Floor Action Blog that, “Senate Majority Leader Harry Reid (D-Nev.) called on Speaker John Boehner (R-Ohio) to stop using the Hastert Rule — only taking up legislation that has the support of a majority of Republicans [video replay at FarmPolicy.com Online].

“‘The Hastert Rule has been bad for this country, and Speaker Boehner should get away from it,’ Reid said on the Senate floor Monday.

“Reid said that if Boehner wasn’t using the rule named after former Speaker Dennis Hastert (R-Ill.), the House could pass the bipartisan Senate farm bill and immigration reform bill.”

The Hill update added that, “Reid said if Boehner continues to insist on using the Hastert Rule, any legislation passed in the House has ‘no hope of passing’ in the Senate or being signed by the president.

“Reid pointed out that the House couldn’t even pass its own farm bill last month, therefore Boehner should try to pass the Senate farm bill with the help of Democrats.”

A news update yesterday from Sen. Kay Hagan (D., N.C.) stated that, “[Sen. Hagan] today visited Rudd Farm in Greensboro to talk about the importance of approving a Farm Bill. In June, Hagan helped pass a bipartisan Senate Farm Bill that contained major victories for North Carolina farmers.

“‘I am deeply disappointed that the House has not passed a Farm Bill,’ said Hagan. ‘My first priority in Washington is to boost our economy and create jobs in North Carolina.’”

 

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In executive branch perspective on Farm Bill developments, Sec. of Agriculture Tom Vilsack was a guest over the Fourth of July holiday on “The Insiders” television program (WHO-TV, Des Moines, Iowa) and provided analysis on variables that contributed to the House failure to pass a Farm Bill.  The former Iowa governor also addressed specific issues associated with the SNAP program, including remarks on the idea of splitting nutrition from the farm programs in the overall bill.

A video replay of “The Insiders” discussion with Sec. Vilsack is available here, while a brief audio clip from the program can be heard here (MP3- 2:30).

 

Agricultural Economy

Purdue University Agricultural Economist Chris Hurt indicated yesterday at the farmdoc daily blog (“Pork Producers Can See the Promised Land”) “Pork producers can see the ‘promised land’ of lower feed costs which will provide an extended period of profitability. Those lower costs are not here yet, but could be just weeks away as prospects for U.S. corn and soybean production have improved in recent days. Producers can see prospects for $2.00 per bushel lower cash corn prices by harvest and $130 per ton lower soybean meal prices in the July to October futures spread. While they see the market’s anticipation of lower feed costs on the near-horizon, they recognize there are still unknowns about acreage, weather for the remainder of the growing season, and early frost.”

Andrew Johnson Jr. reported yesterday at The Wall Street Journal Online that, “Growing conditions for the country’s corn crop improved slightly last week, a weekly report from the U.S. Department of Agriculture showed Monday.

“The U.S. corn crop was rated as being 68% in good-to-excellent condition as of Sunday, up 1 percentage point from a week earlier, the USDA said.”

In trade related news, Reuters writer Doug Palmer reported yesterday that, “The United States and the European Union, after nearly two years of preparation, start talks on Monday aimed at securing a free-trade agreement to squeeze new economic growth out of the world’s largest trade and investment relationship.

“‘We go into these negotiations with the goal of achieving the broadest possible, most comprehensive agreement that we can,’ U.S. Trade Representative Mike Froman told Reuters.”

With respect to the U.S.- EU trade talks, Lydia DePillis penned an update yesterday at the Wonkblog (Washington Post) titled, “Talks over a huge U.S.-Europe trade deal start this week. Here’s what you need to know.”

James Politi reported yesterday at The Financial Times Online that, “At the start of the negotiations, top EU and US officials were optimistic about the prospects for an agreement by the end of next year – an ambitious timeline given the many sticking points that have yet to be tackled by the negotiators.”

And Howard Schneider reported in today’s Washington Post that, “U.S. labor and environmental groups, largely silent in the run-up to the U.S.-Europe free-trade talks, now say they worry that the negotiations could be used to weaken consumer, health and other standards on both sides of the Atlantic.”

On a separate trade issue, an update yesterday (“China’s Genetically Modified Food Fight”) at the China Real Time Report (Wall Street Journal) indicated that, “A Chinese agricultural official’s unsupported claims about the carcinogenic risks of consuming genetically modified soybeans have rekindled a fervent debate about the use of genetically modified crops in a country with ever-expanding food needs.

Wang Xiaoyu, deputy secretary general of the Heilongjiang Soybean Association, a supporter of local non-genetically modified soybeans, recently told local media that people who consume soy oil made with genetically modified soybeans ‘are more vulnerable to developing tumors and suffering sterility’ (in Chinese).”

Yesterday’s update noted that, “Experts were quick to call Mr. Wang’s methodology into question, with several noting that he had failed to present even a scintilla of laboratory evidence linking GMO soy oil with cancer or fertility problems. But in a country already deeply suspicious of genetically modified crops, social media users took the idea and ran with it, sending fear over carcinogenic oil seeping through the Chinese Internet.”

 

CFTC- Commodity Futures Trading Commission

Jamila Trindle and Damian Paletta reported in today’s Wall Street Journal that, “The head of the Commodity Futures Trading Commission is proposing to partially delay controversial cross-border derivatives rules slated to go into effect Friday, according to people familiar with the negotiations.

“The move is an about-face for CFTC Chairman Gary Gensler, who previously refused to delay a requirement that U.S. banks operating abroad comply with U.S. swaps rules, despite mounting pleas from fellow commissioners, lawmakers and overseas policy makers. Mr. Gensler now is floating a compromise that would implement some provisions almost immediately and delay others until the end of the year, said the people familiar with the negotiations.

“The agency may vote as soon as Friday on the rules, which require that firms trading derivatives hold more capital and post collateral to a clearinghouse that secures the deal.”

 

Immigration

AP writer John Flesher reported yesterday that, “For northern Michigan fruit grower Pat McGuire, the most potent symbol of the immigration debate isn’t grainy television footage showing people slipping furtively across the U.S.-Mexican border. Instead, it’s plump red cherries and crisp apples rotting on the ground because there aren’t enough workers to pick them — a scenario that could become reality over the next couple of months.”

The AP article stated that, “From Christmas tree growers in the Appalachians to Wisconsin dairy farmers and producers of California’s diverse abundance of fruits and vegetables, agricultural leaders are pleading with Congress for an immigration bill that includes more lenient and less complex rules for hiring farm workers.

“A measure that recently cleared the Democratic-led Senate contained provisions that the farm lobby said were promising. The Republican-controlled House is expected to take up the issue shortly. But with agriculture’s once-mighty political influence in decline as its workforce has fallen to 2 percent of the population, it’s uncertain how the industry will fare. Farmers’ complaints about a shrinking labor pool are being overshadowed by the ideologically charged issues of border security and giving legal status to people in the country illegally.”

Sara Murray reported in today’s Wall Street Journal that, “After four years of on-and-off negotiations, a bipartisan group in the House has crafted more than 500 pages of new immigration legislation.

“But whether that measure sees the light of day—and whether it gains any momentum—is an open question.

More than a week after the Senate passed its own sweeping bill, House Republicans will gather Wednesday to debate their approach to an immigration overhaul. Many are resisting the idea of passing a comprehensive measure similar to the Senate’s. Instead, some House leaders and rank-and-file Republicans are advocating a piecemeal approach, biting off individual elements of the immigration equation and passing narrow deals.”

Keith Good