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2007 Farm Bill: Opening Day Recap
Alan Beattie, writing yesterday at the Financial Times Online, reported that, “A search for the farmers at the heart of debates about tariff protection and economic development in the Doha round of world trade talks led to the mountainous province of Benguet in the Philippines, six hours north of Manila, the nation’s capital…In the high mountains, growers raise rice and vegetables on centuries-old small traditional terraced plots. Farmers meeting at the local agricultural college in La Trinidad, the provincial capital, unanimously say they regard international trade as a threat rather than an opportunity.”
I. Farm Bill News
II. Doha
I. Farm Bill News
Overview
A news release issued yesterday by the House Ag Committee stated that, “Today, the House Agriculture Subcommittee on Conservation, Credit, Energy and Research approved proposals for the Farm Bill titles under their jurisdiction.
“The Subcommittee considered discussion drafts outlining each title and approved several amendments by voice vote. Copies of the discussion drafts and the amendments approved by the subcommittee are available online at: http://agriculture.house.gov/inside/2007FarmBill.html. A brief summary of the titles considered and amendments adopted is included below.
“Conservation: The discussion draft considered by the Subcommittee extends important land reserve programs, simplifies and improves the Conservation Security Program and substantially increases funding for the Environmental Quality Incentives and Farmland Protection Programs. It also includes several provisions to encourage cooperation between USDA and producers or other entities to deliver conservation programs.
“Amendments approved by voice vote
- Costa Amendment to prioritize the long-term benefits of grassland protection
- Walz Amendment to expand the Cooperative Conservation Partnership Initiative (CCPI) to include projects that simultaneously address rural community development opportunities and environmental enhancement
- Graves Amendment to ensure that entities receiving CCPI funds spend no more than 5% of that funding on administrative costs
- Cardoza Amendment declaring that packing and handling operations are considered on-farm income for the purposes of calculating Adjusted Gross Income
- Herseth Sandlin Amendment to add bison to the definition of livestock for the purposes of the Environmental Quality Incentives Program
-Cardoza Amendment to allow USDA to encourage the development of voluntary sustainable practices guidelines for specialty crops.”
In addition to research and credit, the news release also highlighted work on the energy draft proposal and stated that, “Energy: The discussion draft considered by the Subcommittee includes a Federal loan guarantee program for biorefineries and biofuel production plants. It also reauthorizes and improves several important existing bioenergy programs.
“Amendments approved by voice vote
- Kagen Amendment to establish a pilot program to demonstrate on-farm energy production systems to help farms become energy independent using existing technologies
- Herseth Sandlin Amendment to modify the Section 9006 program that allows farmers, ranchers and rural small businesses to apply for grants and loans to purchase renewable energy systems and make energy efficiency improvements in farms or businesses
- Salazar Amendment to clarify that specialty crop waste and residues are understood to qualify as agricultural cellulosic biomass
-Fortenberry Amendment to establish grants to create models of energy independence in rural communities
-Cardoza Amendment to create an internship pilot program to train the next generation of professionals in renewable energy, ethanol, biomass, and other biofuels.”
The release added that, “On Thursday, May 24, the Subcommittee on Livestock, Dairy and Poultry will hold a markup on Farm Bill issues under its jurisdiction.
“All markups will be broadcast live on the House Agriculture Committee’s website at: http://agriculture.house.gov/hearings/audio.html.”
Conservation
Reuters writer Charles Abbott filed a report on House Ag Committee action yesterday, noting that, “Members of a House Agriculture subcommittee were thwarted by a lack of money on Tuesday from expanding ‘green payments’ to farmers and from creating a $305 million program to combat asthma-causing dust.
“Lawmakers put the ideas on the table during the first bill-drafting session for the farm law being written this year. But they withdrew them without a vote in hopes that money will become available this summer to pay for the programs.
“Without more money for land stewardship, the Agriculture Committee may face a revolt when it brings its bill to the House floor, warned Scott Faber of Environmental Defense.
“‘The leadership has to provide more funds for conservation … Today is a good day for those who want to write the farm bill on the floor,’ said Faber, who is part of a coalition of environmentalists, small-farm activists, fiscal hawks and international development groups who say the U.S. farm program should spend more on stewardship and less on crop subsidies.”
Mr. Abbott added that, “California Democrat Dennis Cardoza said stewardship programs must be expanded so that fruit, vegetable, nut and nursery crop growers can meet a mounting regulatory burden and so that specialty crop growers get a more equitable share of supports.
“He proposed a $305 million air quality program to combat dust and ozone but withdrew it because there was no money.”
“Kirsten Gillibrand, a New York Democrat, proposed full funding of the Conservation Security Program, which would cost billions of dollars, but withdrew her amendment because there was no way to pay for it at the moment. Created in 2002, CSP is the first green payment program for land stewardship. Under current plans, it would be mothballed until 2012,” the article stated.
In fact, Congressional Quarterly’s (CQ) Catharine Richert reported yesterday that, “Subcommittee members offered 27 amendments to the conservation title but withdrew all but the six that were adopted, underscoring the funding obstacles.”
Ms. Richert also indicated that, “Peterson says he has been drafting the bill with bipartisan input, and last week he was flanked by lawmakers from both parties when he unveiled his draft of the conservation title.
“But some House aides said the process has not been as inclusive as Peterson claims. Subcommittee members criticized the chairman for releasing the draft titles just days before the scheduled markup.
“‘I am afraid we are doing this process, as well as our farmers and ranchers, a disservice,’ said the full committee’s ranking Republican, Robert W. Goodlatte of Virginia.
“He said members have not had enough time to review the bill and expressed concern that the panel was ‘rushing this conservation title to meet an arbitrary deadline.’”
The Congressional Quarterly article also pointed out that, “As the day wore on, more and more amendments were pulled, deferring debate until the full committee markup. Lawmakers trickling out of the room seemed to lose interest in the markup, and some expressed annoyance that so little had been accomplished during a meeting that lasted more than six hours.”
“Reserve Fund” Allocations
A separate CQ item from yesterday (“Chairman’s Money Shuffle Creates Friction Over House Farm Bill”) reported that, “Aides say members of the House Agriculture Committee are unhappy with how Chairman Collin C. Peterson has handled this year’s farm bill so far.
“The dissatisfaction intensified last night, aides said, when Peterson told panel members that his draft of the legislation would spend all of a proposed $20 billion ‘reserve fund’ that was meant to pay for new initiatives.”
This CQ update added that, “Peterson, D-Minn., told members last night that he had spread out the $20 billion cushion across the draft bill’s 10 titles, but he would not tell members where it would go, according to aides.
“The announcement frustrated both Democrats and Republicans who were counting on those funds to support new programs.”
USDA Reorganization?
Brownfield’s Peter Shinn reported on the Committee’s activities yesterday (“Congress to reorganize USDA?”) and noted this unexpected transaction, “During debate on one amendment introduced by freshman Ohio Representative Zack Space (D) addressing the roles of the Farm Service Agency (FSA) and the Natural Resources Conservation Service (NRCS) in administering and delivering technical assistance, [Subcommittee Chairman Tim Holden of Pennsylvania] made a surprise announcement.
“‘As we’ve asked other committee members to withdraw their amendments ’til we get to the full committee, I would ask the gentleman to consider withdrawing it until next year,’ Holden urged Space. ‘And respectfully, the reason I say that to my friend is that, in consultation with the chairman of the full committee and with Mr. Lucas, next year we plan to have a reorganization of USDA.’
“Holden didn’t say whether the USDA reorganization would focus specifically on the roles of FSA and NRCS in EQIP. But he suggested the reorganization would be much more sweeping.
“‘Again, after consulting with the chairman of the full committee, we believe any amendments that would come either in this subcommittee or in any subcommittee or in the full committee dealing with the transfer of responsibility or authority,’ Holden explained, ‘we’d like to wait ’til next year when we have a reorganization of the entire Department.’”
This Brownfield report also includes a one-minute audio summary that contains Rep. Holden’s comments about a potential USDA reorganization.
Energy Proposal
Philip Brasher, writing yesterday at The Des Moines Register Online, reported that, “The next farm bill could provide subsidies and loan guarantees to start production of fuel ethanol from corn-field residue and other sources of biomass.
“Congressional pay-as-they-go rules are limiting the size of the programs, and lawmakers still must find a way to pay for them.
“The House Agriculture Committee started drafting its version of the farm bill Tuesday and included a proposal to spend $1.5billion during the next five years to subsidize the production of biomass ethanol as well as traditional biodiesel, which is made from soybean oil and animal fats. Conventional corn ethanol would not qualify for the subsidies.
“Developing cellulosic ethanol — made from crop waste, grasses or other biomass — is considered critical to reducing the nation’s use of gasoline.
“The legislation also would authorize $2 billion in loan guarantees to build cellulosic biorefineries.”
Floor Fight
As to the broader issue of alternative Ag Committee legislation that could potentially be considered at some future date on the House floor, an item posted yesterday at the DTN Ag Policy Blog explained that, “Every congressional committee chairman’s worst nightmare is to work long and hard with core constituents on a bill and then have well-supported substitutes appear in the floor debates and provide substantial amendments to the committee bill. Both Ag committee chairmen, Rep. Collin Peterson, D-Minn., and Sen. Tom Harkin, D-Iowa, said they intend to write this year’s farm bill replacement legislation in their subcommittees and committees. Both suggest that making major changes on the floor would lead to chaos.
“However, the tea leaves now indicate increasingly that the next bill will be at least partly written in floor debates. There are several reasons why.”
The DTN item noted that, “The first is money… A second reason is the level of ‘unconventional interest’ in this year’s debate. In 2002, the main focus was protecting against low commodity prices, plus a few ‘structural’ issues like country of origin labeling and unfair marketing practices. Even so, in that debate environmental and conservation issues led to proposals for radical changes, which failed by only a few votes. This time around, there are many more issues and their supporters are much better organized — and, are expected to offer even stronger challenges.”
The update went on to cite two other reasons why the floor issue deserves watching, “[D]ivisions among producers in their support of current programs — and, the widespread opposition to them by many other rural and non-farm groups,” and new potential use of new data weapons: “the groups pressing for change expect to have new weapons in the form of new, highly detailed information about program payments and their recipients. Environmental Working Group President Ken Cook told the press last week that his group plans to launch a new searchable database of farm subsidy recipients on June 12. He said the updated system will track $43.12 billion in subsidy benefits provided under Title I (commodity) and Title II (conservation) programs for 2003-2005, right down to individual beneficiaries.”
In conclusion, the DTN update stated that, “In the past, the organizational skills and political muscle of the farm and commodity groups tended to trump the larger numbers of non-farm interest groups, and they may do so once again. However, that task seems likely to be a lot tougher this time around…”
And, in an update discussing yesterday’s Ag Committee activity, Environmental Working Group President Ken Cook stated at the Mulch Blog yesterday that, “Observers said that when Rep. Steve King (R-IA) wondered aloud if farmers in his district would understand why money would be spent on air pollution problems of California farmers, Rep. Cardoza wondered right back if farmers in his district would understand corn subsidies to Iowa.
“Folks, this is getting interesting. And the question being begged is very simple:
“Does the make up of the House Agriculture Committee reflect the full House on matters of food, agriculture, nutrition and food assistance, conservation, and biofuels…or does it reflect the narrower interests of subsidized agriculture?”
In other Farm Bill news, a transcript of a conversation with Sen. John Thune (R-South Dakota) and the editorial board of the Argus Leader (South Dakota) was posted at the Argues Leader webpage on Sunday.
In part, the conversation hit on farm policy: “Editorial Board: What kind of farm bill can South Dakota farmers expect as it relates to wind energy or any other components that you think are critical to our economy?
“[Sen.] Thune: I think for South Dakota, the first priority for the farm groups will be the commodity title of the bill, and that’s the safety net. That’s the payments that they get when prices go down. There may be some changes in some provisions in the commodity title. There’s a real debate right now about whether or not we should keep the direct payment. The direct payment benefits cotton and rice growers a lot more than it benefits corn and soybean growers. … It disproportionately benefits the Southern region more than it does folks here. So there’s a question about whether or not those direct payments could be harvested and put some place else in the bill that might be more beneficial, and you’ll get mixed views on that around here. The wheat growers, I think, like the direct payments, the corn growers aren’t as crazy about them, and it’s only about $8-$10 per acre for a corn farmer in central South Dakota anyway. But they want to see a strong … target price that protects them in a down market. … There’ll be a pretty strong conservation title, and Chairman (Sen. Tom) Harkin (D-Iowa) would like to take a lot of money and put it into conservation programs. …”
II. Doha
Alan Beattie , writing yesterday at the Financial Times Online, reported that, “A search for the farmers at the heart of debates about tariff protection and economic development in the Doha round of world trade talks led to the mountainous province of Benguet in the Philippines, six hours north of Manila, the nation’s capital.
“In the high mountains, growers raise rice and vegetables on centuries-old small traditional terraced plots. Farmers meeting at the local agricultural college in La Trinidad, the provincial capital, unanimously say they regard international trade as a threat rather than an opportunity.”
Mr. Beattie stated that, “One of the toughest problems in Doha is the demand of developing countries to be able to shield vulnerable farmers from cuts in tariff protection with so-called ‘special product’ exemptions. The US agricultural lobby’s acquiescence is vital for the round to succeed, and American farmers have demanded more export markets in return for accepting cuts to their subsidies.
“However, small farmers vulnerable to international competition are a hard constituency for governments to ignore. Many vegetables in the Philippines are protected by import tariffs of up to 40 per cent, although applied rates of about 25 per cent is more common. Until they can compete effectively with imports, the farmers are highly resistant to giving up their protection. Without being able to sell vegetables to Manila, they say, they would probably lapse into semi-subsistence rice farming.”
Keith Good
