President Obama and his GOP opponent Gov. Mitt Romney this week responded to an agriculture/rural communities issue questionnaire submitted to both campaigns by the American Farm Bureau Federation (AFBF). In the end, it’s no surprise the answers are long on philosophy and short on details. On energy, both men support a strong alternative energy/biofuels policy, and both support the Renewable Fuel Standard (RFS). Obama says rural America “produced enough renewable fuels to meet roughly 8 percent of our needs.” Romney says he wants to see a North American energy independence initiative by partnering with Canada and Mexico. Obama says his Administration increased the ethanol blend rate to 15 percent, “and the new RFS helped boost biodiesel production to 1 billion gallons in 2011, creating 39,000 jobs.” Romney says alternative energy will lower the cost of energy to producers. AFBF asked the candidates if they support the states’ primary role in regulation both non-navigable waters and non-point source runoff. The Obama campaign contends there’s too much misinformation about the Environmental Protection Agency’s (EPA) intent, and stressed “we are not going to apply standards to water that have not been historically protected … all existing exemptions for agricultural discharges and waters are going to stay in place.” Romney’s people contend EPA rules and regulations have been “seized by environmentalists to disrupt economic activity … (President Obama’s EPA) is embarking on the most far-reaching regulatory scheme in American history.” Romney wants to “modernize” EPA regulations, and wants a “rational” approach to rules that include cost/benefit analysis. On a new Farm Bill, Obama says he understands the need for a strong farm safety net, and touts his Administration’s action to “increase the availability of crop insurance and emergency disaster assistance to over 550,000 farmers …” along with expansion of farm credit. Romney says he wants to see a “strong farm bill that provides the appropriate risk management tools … (and) in the near term, my immediate priority is enacting disaster relief …” Romney also referred to foreign producer subsidies and warned we should not “unilaterally change our policies” so that “we don’t ever find ourselves in a circumstance where we depend on foreign nations for our food the way we do with energy.” On broad fiscal policy, the candidates were asked how they plan to reform budgetary policy, with Obama citing his earlier plan for $4 trillion in deficit reduction, including $1 trillion in spending cuts. Romney says “getting reckless government spending under control is one of my top priorities.” Obama blames the Bush Administration and a bad economy, and says the Romney plan to cut the budget by $5 trillion lacks details. Romney says he’ll review and cut programs, with several programs destined to be returned to state control. On immigration, AFBF approached this issue as a question about solving agriculture’s labor shortage. Romney said the current temporary ag worker visa program is broken, with 43 percent of applications not processed in a timely fashion. Obama says the system needs to protect U.S. workers and temporary ag workers should “only be used when U.S. workers are not available.” Obama supports the AgJobs bill on reforming the visa system, and says his Administration is already improving the system by creating a new Office on Farmworker Opportunities at the U.S. Department of Agriculture (USDA). Romney called for wholesale immigration reform, and said he’d not propose “heavy-handed regulations that limit youth opportunities involved in agriculture.” On reforming the tax code, Obama’s campaign wants to see comprehensive tax reform, restated his desire to raise taxes on couples earning $250,000 or more per year, attacked Romney’s tax position, and says he’s protecting 97 percent of U.S. small business owners. Romney wants reform that lowers rates, broadens the tax base, gets to revenue neutrality and maintains a progressive tax code. Romney says his plan will create 12 million jobs. On estate taxes, Obama would top the estate tax rate at 45 percent with a $7 million couple’s exemption, saying under his plan only 60 small farms and businesses would owe any tax in 2013. Romney would repeal the estate tax. Obama wants to increase the capital gains tax rate to Clinton era levels, while Romney would maintain the current 15 percent rate for the wealthy, while eliminating capital gains, dividend and interest taxes for anyone making $200,000 or less per year. For a full read of the candidate responses, go to http://www.fb.org/index.php?action=legislative.2012presidentialQuestionnaire.
Those hoping the House will take up the five-year 2012 Farm Bill approved by the House Agriculture Committee during the November lame duck congressional session – House Speaker John Boehner (R-OH) pledged farm legislation would be “dealt with” during the lame duck, but didn’t promise to take up a five-year bill – may have to settle for a short-term extension or a Senate rewrite of the House-passed livestock/specialty crop disaster package instead. Even if the House were to approve its Farm Bill the first day back after the election, the disparities between the Senate and House bills may be insurmountable. First, the commodities titles don’t agree, and Southern crop producers continue to oppose the Senate bill as overly generous to Midwestern corn and soybean farmers, and while they see improvement in the House bill, they continue to hold hope a conference committee would rewrite the entire direct payment section. Given there’s no consensus among national commodity groups on how to re-invent direct payments – other than wanting to see a five-year bill enacted this year – the conferees lack direction. Then there’s the battle over food stamp outlays. While the Senate bill cuts $4 billion from the food stamp program, the House bill cuts the program by $16 billion, with both committees saying their cuts are aimed at fraud, waste and abuse within the program. The ultimate outcome comes down to cost and support, and the most recent incentive to emerge to get the House Farm Bill passed in this Congress is the congressional budget formula used to determine the bill’s cost. If the bill gets punted until March 2013, as some suggest, it will likely be rewritten based on new spending estimates that include the impact of this summer’s historic drought on corn and other commodity prices and estimates of higher prices over the next couple of years. The House Price Loss Coverage (PLC) re-invention of direct payments – which includes target prices – kicks in when prices fall below preset levels. As prices rise, the payouts are smaller or nonexistent and the bill is scored by the Congressional Budget Office (CBO) as “cheaper” given projected increases in program commodity prices. This same formula scenario makes the Senate bill the more expensive of the two pieces of legislation – CBO scored the Senate bill based on an assumption last March of $4.50-$5 corn – a development House ag panel ranking member Rep. Collin Peterson (D-MN) says will kill the Senate revenue program – Agriculture Risk Coverage (ARC) – which is a move he favors because it does not include target prices. Peterson says farmers who want revenue protection can expand their federal crop insurance coverage. However, House Agriculture Committee Chairman Frank Lucas (R-OK) says getting a full five-year bill enacted and to the President by March is “highly improbable.” One new scenario being floated is for Sen. Debbie Stabenow (D-MI), chairwoman of the Senate Agriculture Committee, to take the House-passed disaster assistance bill, load it up with “must-have” sections from the Senate Farm Bill – items negotiated with her House counterparts – then pass that “disaster bill” in the Senate and force the House to take it or leave it. This evolving confusion is inspiring a number of groups to ask for a simple 90-day extension of current law in hopes the landscape will be smoother come 2013 and the new Congress. Congressional leadership and ag committee leaders oppose and extension.
Frustrated with House leadership’s refusal to formally poll even its GOP members to gauge whether there are enough votes to pass the House Agriculture Committee’s 2012 Farm Bill, panel ranking member Rep. Collin Peterson (D-MN) enlisted colleagues from both sides of the aisle to find out how many votes the Farm Bill would get if it was voted on today. Peterson is frustrated with House Speaker John Boehner’s (R-OH) refusal to bring the committee bill to the floor because he asserts there aren’t enough votes to pass it, a Boehner mindset fostered by Majority Leader Eric Cantor (R-VA), Peterson says. Peterson polled both GOP and Democrat members just before Congress left for its election recess in mid-September, finding 125-150 Republicans would vote for the committee bill, and 85-115 Democrats similarly favor the ag panel’s bill. It takes 218 votes to pass a bill in the House.
The so-called federal “fiscal cliff” – a combination of mandatory budget cuts and expiring tax reductions – looms large in the minds of all members of Congress as the election nears, but this week House and Senate budgeteers were confident a deal will be cut to avoid massive federal budget cuts and significant increases in individual and corporate tax rates in 2013. The first hurdle to get over is the 3 percent across-the-board mandatory budget/spending cut authorized in 2010 as part of the same deficit reduction legislation which created the unsuccessful “super committee.” That bipartisan, bicameral special committee was supposed to come up with the legislative silver bullet on federal budget and deficit control. This mandatory cut is known as “sequestration,” and affects about 97 percent of federal spending, including the military and various health care, assistance and welfare programs, so-called “entitlement” programs. While most congressional attention has been on how to protect the Department of Defense and Pentagon budgets from cuts, other parochial interests have been as active. Senate Budget Committee Chairman Kent Conrad (D-ND), who will retire from the Senate at the end of the year, floated this week to Senate Majority Leader Harry Reid (D-NV) a plan calling for a “deficit-reduction down payment,” a one-time relatively small cut to overall spending as a first step toward carving $4 trillion over 10 years from the federal budget – and some programs would be protected. Conrad would then have Reid give instructions to all committee chairs to find further spending cuts and income producers that total $4 trillion. Sen. Richard Durbin (D-IL), Senate majority whip, proposed a six-month extension of the sequestration deadline of January 1, to give members time to find the $4 trillion in targeted savings/revenue enhancers. Durbin’s idea is not popular, and most are calling for a one-time solution during lame duck. To get there, however, even entitlement programs such as Medicare, will be on the table for re-invention. On the House side, Ways & Means Chairman Dave Camp (R-MI) is putting the finishing touches on his tax overhaul package to be included as part of the House sequestration bill. Camp, who re-affirmed his commitment to “fundamental tax reform,” is wrestling with how to handle changes to the federal capital gains tax. Some have publicly called for keeping it at the current 15 percent rate; however, independent economists say the GOP can’t push for dropping individual tax rates below 35 percent without increasing the capital gains tax to the Clinton Administration rate of 28 percent. To do one without the other provides a disproportionate tax break for the wealthy, critics say. The Bush era tax cuts, which if not extended would push individual and corporate tax rates significantly higher – a lose-lose situation for both Republicans and Democrats – are expected to be extended as part of any deal, but with some likely additional tax pain felt by wealthy taxpayers. Insiders contend President Obama’s call for not renewing Bush tax rates on incomes more than $200,000 individual/$250,000 couple doesn’t have the support on either side of the aisle in either chamber for enactment. However, there’s speculation the tax rate may be allowed to go up on incomes more than $750,000 per couple, and many say the income level may be $1 million.
A public relations campaign designed to inspire public and political support to preserve the federal Renewable Fuel Standard (RFS) was launched this week by several biofuels organizations and companies. The “Fuels America” program focuses on the absolute need for alternative fuels to maintain U.S. energy security. At a press event in Washington, D.C., the coalition supporting the campaign discounted the RFS contribution to corn price run-ups and said recent governor and industry petitions to EPA to waive the RFS for ethanol will have little or no effect on corn prices or supplies. The group also touted the contributions made by the bioenergy industry in jobs, tax payments and reductions in foreign oil imports. The coalition membership includes the Biotechnology Industry Organization (BIO), and several of its member companies including DuPont, National Farmers Union (NFU), National Association of Wheat Growers (NAWG), National Sorghum Producers, National Corn Growers Association (NCGA), American Security, Novozyme, POET, Growth Energy, Abengoa Bioenergy, American Coalition for Ethanol, Advanced Ethanol Council, American Council on Renewable Energy (ACORE), 25x25 and the Renewable Fuels Association (RFA). The coalition’s website is www.fuelsamerica.org.
The federal Renewable Fuel Standard (RFS) mandate for how much biodiesel must be blended into gasoline as a means of lowering U.S. reliance on foreign oil was increased this week by EPA. The 2013 RFS for biodiesel – which can be refined from both oilseeds (including soybeans and sunflowers) and animal byproducts (including fats and oils) will be 1.28 billion gallons, up from 1 billion gallons this year. The American Soybean Association (ASA) praised the EPA move, saying it will expand the market for soybean farmers, increase soybean meal supplies to the feed industry, create jobs and reduce U.S. dependence on foreign oil. ASA says the variety of feedstocks from which biodiesel can be refined – particularly animal fats – means when prices spike for soybeans, biodiesel refiners have alternative feedstocks to which they can switch.
A French study – conducted by a scientist with a long history opposing genetic modification of food crops, and alleging Roundup Ready corn causes tumors and premature death in rats – has been all but dismissed by the world scientific community as seriously flawed and politically motivated. However, its existence continues to complicate the GMO food safety debate, has led Russia to temporarily suspend imports of Roundup Ready corn this week, and has given new fuel to efforts to force labeling of foods derived from GMO crops or containing ingredients from GMO crops. Media reports on the French study, released last week under bizarre circumstances by the Sustainable Food Trust in England – reporters had to sign agreements they would not ask third party scientists to critique the study – indicate several serious flaws in the study’s methodology that have produced highly questionable and unique results, including rats which allegedly died of cancerous tumors after eating the GMO corn and feeds, but not after eating the herbicide itself. While a synopsis of the study’s findings was released, no data was shared with reporters, leading one scientist to conjecture “there’s something to hide here.” As the battle heats up over Prop 37 in California – a November ballot initiative to require labeling of biotech-derived foods, including feeds and pet foods – even labeling supporters are skeptical of the study, and critics continue to worry that the notoriously anti-GMO European Union (EU) will overreact to the study.
With the first presidential debate just days away, pro-immigration reform advocates are unloading their demands on both candidates. At the same time, Congress is getting the lion’s share of blame for the failure to address immigration reform. Polls emerged this week showing “rural voters” are more likely to favor a Democrat approach to comprehensive immigration reform, including a pathway to citizenship for illegals, rather than the GOP platform position stressing stronger borders and opposition to any form of amnesty for illegals. At the same time, the New York Times this week published a story detailing how President Obama’s recent executive order granting some children of illegal immigrants who have been in the country at least five years with two-year deferrals from deportation – the first applications were approved last week and received legal work permits – will complicate employers’ ability to verify citizenship status of job applicants. About 1.2 million workers are estimated to qualify for the deportation deferrals. The Times reported that workers applying for the deferrals can ask employers to verify their jobs as one way of meeting the five-year residency requirement, but critics say employers then place themselves in the position of “knowingly” hiring an illegal immigrant, and prosecutions could ensue down the road. The federal government issued new guidelines on the deferral program this month, and said businesses can provide employment verification, but again, critics contend this could lead to investigations and prosecutions if “widespread” patterns of illegal hiring are suspected.