Washington Report for 10-19-12

By Steve Kopperud

Farm Bill Still Issue in Campaigns

While congressional leadership has still not released the exact dates of the November lame duck session, the failure of the House to pass a five-year Farm Bill continues as an issue in farm state congressional races, particularly those hard fought in the Senate. From Iowa where two incumbents are battling it out, to Montana where a veteran House Republican is challenging a Democrat Senate incumbent, who's to blame for the failure to enact an omnibus farm bill is the incentive for much political finger pointing. Sen. Debbie Stabenow (D-MI), chairwoman of the Senate Agriculture Committee, told a re-election audience this week she's proud of her committee and the full Senate for approving a five-year Farm Bill. However, that achievement means nothing, she said, if the House doesn't act during lame duck to either approve a new Farm Bill or at the very least formally extend existing farm programs. Perhaps the most vocal and seemingly desperate producers calling for a new Farm Bill are dairy farmers. Nearly all of dairy's support programs disappear by the end of the year – most have disappeared already – and so dire is the situation that Maine dairy farmers came to Washington, D.C., this week to make sure that state's 306 dairy farms – ranging from 10 to 1,700 cows – are not left in the dust of disappearing dairy support programs. House Speaker John Boehner (R-OH) and Majority Leader Eric Cantor (R-VA) have confirmed that, with some "tweaking," the House's committee-approved bill will be brought to the floor during the lame duck session. The biggest hurdles: getting commodity groups to agree on a collective approach to replacing direct payments with risk-based programs, and finding a middle ground – or a way to explain committee action – on nearly $16 billion in cuts to federal food stamps over 10 years.

Fiscal Cliff Solutions Slowly Evolving, Sniping Continues

Eight Senators and a handful of House colleagues continue to meet in hopes of hammering out a bipartisan proposal to avoid the looming January 1, 2013, "fiscal cliff" – the expiration of current tax cuts along with a 3 percent, or $109 billion annually, across-the-board cut in federal spending – in order to avoid reversing the economy's sluggish recovery. Progress on coming up with a bipartisan agreement has not been as quick as negotiators hoped, and some members have already started examining ways to mitigate the impact of higher taxes and lower spending that will kill programs and idle federal workers. The so-called Senate "Gang of Eight" – eight Senators from both sides of the aisle who've accelerated their discussions and meeting schedule in the last couple of weeks – remains collectively confident a package can be hammered together that will get 60 votes in the Senate and pass the House. Sen. Chris Coons (D-DE) has proposed the group set aside the $109 billion in automatic cuts, accepting instead a $75-billion "down payment" on deficit reduction with an agreement to set aside further cuts for six months. Sen. Tom Coburn (R-OK), a member of the gang, says he's confident a solution will be reached, even though this week he released his annual "Wastebook," a chronicle of 100 federal programs he's identified as wasteful. The number one program is Congress, Coburn said. This week the group met with former Sen. Alan Simpson (R-WY) and former Clinton chief of staff Erskine Bowles – chairs of the National Commission on Fiscal Responsibility & Reform – about their plan, the basis of which is cutting spending but raising revenue through efficiencies and tax reform. Simpson called the eight senators "warriors" and said he's hopeful the group will find consensus. Analysts say it's difficult to gauge how much progress has actually been made given the amount of pre-election sniping that's gone on among rank-and-file House and Senate members. One insider said both parties' leadership is on board with finding a bipartisan compromise – even though House Speaker John Boehner (R-OH) said this week he's skeptical of the economic benefits and impact of such a package – but it's the rest of both chambers who are the problem. Pre-election sniping includes a number of members, mostly Republican, who say they're willing to let the economy "go over the cliff" rather than give up too much in spending cuts and budget controls. Meanwhile, Rep. Norm Dicks (D-WA) sent a 15-page letter to his colleagues outlining the disruptions and cuts to public safety, transportation, health care and defense.

Waxman Wants FDA to Collect Feed Mill, On-Farm Antibiotics Data

He'll introduce a new bill when Congress returns to mandate that the Food and Drug Administration “improve" the data it collects on agricultural antibiotics use, said Rep. Henry Waxman (D-CA), ranking member of the House Energy & Commerce Committee, the panel with FDA oversight responsibility. The bill would require for the first time feed mills to report what antibiotics it uses in its feeds, what the drugs are used for, and whether it's growth promotion or disease control and prevention. The American Feed Industry Association said the bill is a retread of failed legislation and, if enacted, would be expensive, time-consuming, yield little new information, and possibly require feed mills to release customer information. The bill – the "Delivering Antibiotic Transparency in Animals (DATA) Act" – was immediately praised by Consumers Union, which last month delivered a petition to the agency signed by half a million people. In addition to the feed mill reporting requirements, drug makers would be required to provide more than the total sales data now reported. The companies are not required to break the data down by species or distinguish which drugs were used in food-producing animals. The reporting would only affect drugs used in food animals, and would exclude horses and pets. FDA's Center for Veterinary Medicine is pursuing a voluntary industry collaborative approach, and intends to eliminate exclusive label claims for growth promotion/feed efficiency, opting instead to limit those uses within a new definition of "prevention" and tying all use to an expanded Veterinary Feed Directive program. Waxman joins Rep. Louise Slaughter (D-NY) in seeking to somehow limit or eliminate the use of antibiotics in agriculture, claiming this use is the root cause of resistance in humans.

Roberts Fed Up with Derivatives Rule, Wants Hearing

The Commodity Futures Trading Commission's new rule on derivatives and position limits continues to generate controversy, with Sen. Pat Roberts (R-KS) this week calling for a post-election hearing on the new rules and the limits set by the commission on how much collateral and capital major traders need to meet the new criteria. Roberts contends the CFTC has exceeded its authority and has misread the Dodd-Frank Law that requires new regulations of financial markets. CFTC Chairman Gay Gentler has pursued "political and ideological goals" and is not following the intent of the law, similar to criticisms leveled at Gentler by House Republicans. The House members want to see an accounting by the end of the month of the costs involved in producing the rule that limits positions in 28 commodities. Roberts pointed to a federal judge's invalidation of the rule, which is supposed to go into effect next week, in saying the commission has gone too far. Roberts reminded reporters this week that at one point, Gentler said only about 20 derivatives dealers would be affected by the new rule; today, he says the number of traders captured by the rule is closer to 300 swaps dealers.

Immigration Reform Pops to Forefront in Campaigns

With the last presidential debate taking on both comprehensive immigration reform and the DREAM Act – along with the related presidential executive order – Sen. Kirsten Gillebrand (D-NY) this week released a Government Accountability Office report that says the federal H-2A visa program for temporary workers is broken, and called on the Department of Labor to allow employers to file a single application per season for multiple workers. The report said that more than 90 percent of applications were approved during FY2011, but processing delays meant only 63 percent were approved in a timely manner, and 7 percent were approved less than 13 days before the workers were needed. DOL disagreed with Gillibrand's interpretation of the GAO report, and said the law would require an employer to hire and use all of the workers included in the application, not just some of them. Gillibrand said DOL's position is perpetuating an inefficient system and jeopardizes agricultural crop and fruit/vegetable production which relies on immigrant labor and the visa program. President Obama was hit by Gov. Mitt Romney during the second presidential debate for not having pushed harder for comprehensive immigration reform during his first two years when the Democrats controlled both houses of Congress. The President said he'd have immigration reform completed during his first year in office. The president said the issue has become divisive and needs bipartisan support.

Ag Awaits EPA Ruling on RFS Waiver; Europe Moves to Limit Crops in Biofuels

While eight U.S. governors and most of the nation's livestock and poultry industry await the Environmental Protection Agency’s decision on whether to waive all or part of the ethanol Renewable Fuel Standard – a decision expected shortly after the November election – the European Union this week said it wants to limit the amount of food crops used in biofuels refining, primarily ethanol and biodiesel, so as to avoid competition with the food industry and to spur development of fuels refined from non-food crops and grasses. The European Commission said that first-generation biofuels made from sugar, starches and vegetable oils provide 5 percent of the continent's transportation fuel, but said the goal of reaching 10 percent poses potential problems, similar to those in the U.S. Legislation will be introduced to set the limits on food crops in biofuels manufacture, but that legislation must be approved by the European Parliament as well as the EU member nation governments. 

U.S. Pushing Ahead on Trade Pack with EU

U.S. Senators traveling in Europe this week tested the waters with their European counterparts on whether they're interested in bilateral trade agreements between the two governments. Talks are set to begin next year between the U.S. and the European Union, representing about a third of world trade. However, critics contend the poor European economy, the debt crisis and a slowed U.S. economy make it unlikely that a pact will be completed any time soon. Sen. Max Baucus (D-MT), in Europe for high-level fiscal meetings, said he's pushing for new U.S. export opportunities with the EU, including expanded barley and beef trade. Baucus said the biggest hurdle to overcome will be what he called non-scientific bans on U.S. pork and beef imports, and urged European leaders to bring their import policies in line with sound science.