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Climate Legislation; Doha; Cotton; Biofuels; and Rural America
Climate Legislation
Philip Brasher noted in yesterday’s Des Moines Register that, “The Obama administration is having a tough enough go with its effort to reform health care, but things aren’t going so well with another of the administration’s priorities either – addressing global warming.”
“So far, there is little evidence that much of a consensus is developing in the Senate on a cap-and-trade climate bill, and the climate issue is being overwhelmed by the public debate over health care,” Mr. Brasher stated.
“Meanwhile, the pace is slowing in the Senate. The chairwoman of the Senate Environment and Public Works Committee, Barbara Boxer, had been expected to release a draft climate bill as early as this week. Instead, she announced on Monday that she hopes to introduce a bill with Sen. John Kerry, D-Mass., later this month.”
Yesterday’s Register item indicated that, “The administration is trying to prod Congress into passing a climate bill by another method – threatening to impose caps on greenhouse gas emissions through use of the Clean Air Act. The Environmental Protection Agency sent proposed rules to the White House last week that would cap emissions at a level that would hit large industrial sources, according to Greenwire, a news agency. Critics question the EPA’s legal authority to impose such a cap, which would be higher than normal limits under the Clean Air Act, and they express doubt that a Congress reluctant to enact emission caps on its own would stand by while the EPA imposed them.”
Reuters writer Richard Cowan reported yesterday that, “Environmentalists hope the push in Congress for climate change legislation is not overwhelmed by the debate dominating Capitol Hill over changing the U.S. healthcare system. But it might be.
“Already two months behind schedule and unsure whether enough Democrats will play along, Senate leaders still aim to pass a bill by December when a United Nations summit convenes in Copenhagen to set worldwide goals for reducing carbon dioxide and other pollutants.
“But as the debate over healthcare legislation rages and with President Barack Obama due to address a joint session of Congress on Wednesday to try to rescue the faltering plan, it was unclear whether rattled lawmakers will have the time — or the inclination — to take on climate change.”
Greg Hitt and Naftali Bendavid reported in Saturday’s Wall Street Journal that, “President Barack Obama’s scheduled appearance before a joint session of Congress on Wednesday reflects Washington’s intense focus on health care. But lawmakers have a full plate of other pressing priorities as well, and return from recess facing post-Labor Day fights on everything from spending priorities to shutting down the Guantanamo Bay detention facility.
“The crowded calendar may force Democratic priorities such as climate change and financial regulation to the sidelines, for this year at least. At the same time, less prominent initiatives — such as a student-loan overhaul, an extension of jobless benefits and a reworking of the estate tax — stand a good chance of making it to the president’s desk.
“The packed agenda has leaders in both parties wary. ‘It is a tall order,’ conceded Sen. Dick Durbin of Illinois, the Senate’s No. 2 Democrat. ‘I don’t know how much we can realistically finish.’”
The Journal writers pointed out that, “Also looming in the Senate is climate-change legislation, Mr. Obama’s top priority after health care. The House approved a measure in June to curb greenhouse-gas emissions, and Democratic Sens. Barbara Boxer of California and John Kerry of Massachusetts announced recently that they would unveil a Senate version by the end of September.
“Senate Majority Leader Harry Reid of Nevada said he hoped his chamber would vote on it by year’s end. But if the health debate drags on, it will be hard to find time for the climate bill. Moreover, many moderate Democrats, such as Indiana Sen. Evan Bayh, are concerned it would hurt U.S. industry. The loss of any Democratic votes would likely block the measure indefinitely.”
And Peter Baker reported in today’s New York Times that, “Of all the challenges Mr. Obama faces this fall, health care has come to dominate so much that the fate of the rest of his domestic program, particularly climate change legislation and new regulations on the financial industry, may depend in part on whether he wins this fight.”
Meanwhile, the National Association of Wheat Growers (NAWG) indicated in a news update from Friday that, “The NAWG Board of Directors met by conference call Friday to discuss pending climate change legislation.
“As part of that discussion, the Board voted 26 to two to approve a new resolution regarding greenhouse gas regulation. The new resolution reads:
“‘NAWG is opposed to greenhouse gas legislation or regulation that has a negative impact on production agriculture. NAWG will strive for a net economic benefit to farmers, agriculture and food production. We believe neither greenhouse gas regulation nor legislation should take effect until the major carbon emitting countries of the world have agreed to regulate their own greenhouse gases in a like manner to ours. NAWG urges USDA to do a detailed economic analysis of any legislation or regulation before it becomes law. Furthermore, NAWG will oppose EPA regulation and will work to overturn the Supreme Court ruling.’
“The Board also voted 24 to zero to remove existing resolutions relating to greenhouse gas regulation and an agriculture cap-and-trade program.”
Doha
James Lamont reported late last week at the Financial Times Online that, “Failure to find agreement at United Nations climate change talks in Copenhagen in December would threaten a much needed overhaul of the international trading system, Pascal Lamy, head of the World Trade Organisation, warned on Thursday.
“His comments highlighted concerns that a breakdown in discussions about reducing greenhouse gas emissions may spill into the trade arena – with devastating effect, as some countries seek to exclude goods from high emitters.”
The FT article explained that, “India has already protested to Hillary Clinton, the US secretary of state, about the threat of carbon tariffs from environmental legislation proposed by the Obama administration.
“Speaking as trade ministers from 39 countries met in New Delhi to progress the WTO’s Doha round, Mr Lamy cautioned against adopting trade measures to force changes in environmental behaviour.
“‘I sincerely hope that [agreement] will happen in Copenhagen. If it doesn’t happen, our job at the WTO will become more difficult,’ Mr Lamy told the Financial Times. ‘Go-it-alone measures will not achieve the desired results. Relying on trade measures to fix global environmental problems will not work.’”
In more specific developments regarding the WTO Doha talks, the AP reported on Friday that, “Trade ministers from some of the world’s most powerful economies agreed Friday to resume stalled negotiations to forge a new global trade agreement, an Indian official said.
“Trade officials will meet in Geneva next week to resume the Doha round of multilateral talks being negotiated through the World Trade Organization to lower tariffs and increase free trade, India’s Commerce Minister Anand Sharma said.
“‘This meeting was to re-energize the process,’ Sharma told reporters at the end of a two-day informal meeting attended by around 30 trade ministers, heralding the announcement of resumed negotiations as a significant breakthrough.”
Reuters writer Jonathan Lynn reported on Friday that, “Key trade ministers agreed on Friday to relaunch the World Trade Organization’s Doha talks with intensified negotiations later this month, India’s Commerce Minister, Anand Sharma, said on Friday.
“WTO members’ chief negotiators will meet in Geneva from September 14, in the run-up to the Pittsburgh G20 summit, to grapple with outstanding issues in the talks, now in their eighth year, with the aim of completing the round by 2010, he said.”
Mr. Lynn added that, “The talks will resume on the basis of the draft negotiating texts issued in December 2008.
“That should provide comfort to WTO members from Brazil to the European Union who had feared that the United States wanted to unpick what has already been agreed over the past seven years, jeopardizing the emerging deal.
“Both Sharma and U.S. Trade Representative Ron Kirk said it would be wrong to throw away the work achieved so far, but stressed that the texts were drafts and could be improved.”
Vikas Bajaj reported in Saturday’s New York Times that, “After two days of meetings in the Indian capital about how to restart the trade talks known as the Doha Development Round next year, trade ministers said they were committed to reaching a deal in 2010. But the tenor and substance of their comments suggested that few are willing to soften their stances.”
The article stated that, “As talks wrapped up Friday, there appeared little softening in the position of either richer developing countries like Brazil and India or the United States. The Obama administration faces a difficult task in selling free trade deal to a Congress preoccupied by health care, the war in Afghanistan and the recession.
“The two camps appear to still disagree even on the way negotiations should be conducted. The U.S. trade representative, Ron Kirk, pressed for more bilateral negotiations in which countries provide details of how they intend to implement agreements.”
The Times article also indicated that, “[S]enior government officials suggested that India’s stand on agricultural trade barriers had not changed since last year.”
Reuters writer Jonathan Lynn reported yesterday that, “A new global commerce deal is within reach if World Trade Organization members are willing to compromise to close the remaining gaps, trade ministers say.
“But agreement in the WTO’s stalled Doha round will require a sustained political push from presidents and prime ministers if the long-running talks are not to stall yet again, they say.”
Cotton
Darren Hudson, the Director of the Cotton Economics Research Institute at Texas Tech University, noted in an item posted last week at the Plainview Daily Herald Online (Plainview, Texas) that, “A recent subsidy increase for India’s cotton farmers could drop world cotton prices by as much as 6 percent, according to a report from Texas Tech University’s Cotton Economics Research Institute (CERI).
“U.S. farmers will see their prices slashed by an average 2.48 percent during the next five years, cutting into an industry that CERI Director Darren Hudson said pumps roughly $40 billion into the U.S. economy each year.
“While U.S. producers often take heat from developing countries for the subsidies they receive, Texas Tech researchers point out India employs a domestic subsidy program similar to U.S. marketing assistance loans.
“The country’s minimum support price represents the rate at which India’s government will purchase seed cotton from farmers.”
Biofuels
Dan Looker reported on Friday at Agriculture Online that, “At the request of Senator Chuck Grassley (R-IA) two high-ranking EPA officials came to Iowa Thursday to learn first-hand how their agency’s rules could affect farmers and the biofuels industry.”
“‘I think we learned a lot,’ EPA’s Gina McCarthy told Agriculture Online after stepping outside the spotlessly clean biodiesel plant. ‘It helps us put a face on the agricultural issues and the challenges we face together.’
“McCarthy is EPA’s Assistant Administrator for the Office of Air and Radiation. With her was Margo Oge, who heads the office of transportation and air quality.
“It’s no exaggeration to say the two women hold the future of the biofuels industry, and even the future price of corn and soybeans, in their hands.”
Mr. Looker noted that, “Oge is in charge of writing the final rule for a new renewable fuel standard that requires all biofuels to have lower carbon emissions than fuel from petroleum. The change is required by a 2007 energy bill that also ramps up federal support for biofuels
“When EPA released the first draft of that rule last May, neither ethanol nor biodiesel made the cut. The 2007 Energy Bill exempts existing corn ethanol plants, but ethanol from new ones has to be 20% greener than gasoline. EPA found Midwest corn-based ethanol to be only 16% greener. Soy biodiesel has to be 50% greener and older plants aren’t exempt from the rule. EPA said in May that soy biodiesel is only 22% greener than diesel fuel.
“The reason is that EPA included ‘indirect land use’ in computer modeling used to estimate the carbon footprint of biofuels. That’s the concept that when corn or soybean production is diverted from food to fuel in the U.S., grassland and rainforests in tropical countries like Brazil are converted to grain and oilseed farming. Burning off the forests and plowing up tropical savannah puts so much carbon dioxide into the atmosphere that it can take up to 166 years for the benefits of ethanol to counteract that, according to one theory advanced in Science magazine.
“Thursday, McCarthy and Oge heard why that hypothesis misses the mark. And the polite but documented criticism came from some of agriculture’s most influential leaders – Dean Oestreich, chairman of Pioneer Hi-Bred International, Ted Crosbie, vice president of global plant breeding for Monsanto, and Jeff Stroburg, CEO of the Renewable Energy Group.”
Rural America
On Friday, USDA’s Economic Research Service (ERS) issued a brief report entitled, “Rural America At A Glance, 2009 Edition.”
An ERS overview of the report stated that, “Update of an annual series, the 2009 edition of Rural America At A Glance deals with effects of the major recession on rural America. Initially, effects of the recession were mitigated in nonmetro areas by high commodity prices throughout much of 2008, but as the recession deepened, prices fell. Both nonmetro and metro areas experienced rising unemployment as manufacturing and other major employment sectors contracted, and they were similarly affected by the mortgage foreclosure crisis. However, even before the current recession, nonmetro poverty rates had risen in the growth years after the 2001 recession, against the usual trend during a time of economic expansion; the nonmetro poverty rate has exceeded the national poverty rate since 2001. The nonmetro population continued to grow in 2007 and 2008, but at less than half the rate of the metro population. Nonmetro growth is largely due to a rise in births, offsetting a decline in net migration from metro to nonmetro areas.”
Keith Good
