Carve away the predictions of immediate disaster due to the March 1 implementation of the sequester – $83.5 billion in across-the-board federal spending cuts – and it appears it likely would not be until early- to mid-April before any program or service changes are experienced. First, the Office of Management & Budget will “apportion” the 4.6-percent reduction in federal discretionary spending across the government, and it’s difficult to say how those reductions will fall as some program cuts are limited, as in the case of Medicare which can only be cut by 2 percent. It’s also highly likely that given March 27 is the deadline for either extension of the current continuing resolution that’s kept the government operating at FY2012 spending levels, or congressional enactment of an omnibus spending package for the rest of this fiscal year, a sequester solution could be tucked into that package. All federal departments and agencies have been gearing up for the possibility of sequestration as the White House has had the government on high alert for over 60 days. Furloughs of federal employees will not be immediate nor across the board; the White House said federal workers would receive at least 30 days’ notice of any furloughs that last up to 22 days, and several federal government union contracts require 60 or 120 days’ notice. Also, agencies and departments will be allowed to implement “rolling furloughs” – workers allowed to allocate their furlough time over several weeks in one or two-day increments each week.
As expected, the Senate rejected both Democrat and Republican plans for avoiding $83.5 billion in across-the-board federal budget cuts as sequestration kicked in March 1. And while there’s no immediate solution on the horizon, both chambers are now scurrying to see how they can come up with a plan that avoids disaster, but shows “flexibility” in how spending cuts are implemented. Another sign of possible movement – likely about the time the current continuing resolution expires March 27 – the Administration released a report mandated by the Budget Control Act, which details how the cuts will affect the federal government on an agency-by-agency basis, and the White House has sent to congressional appropriators a plan by which certain federal programs would be included in a continuing resolution at either static or higher spending levels to ensure their survival. The Food and Drug Administration announced it would not furlough employees, but would absorb the spending cuts through reduced travel, training and suspension of some contracts and “outside collaborations.” President Obama met with congressional leaders at the White House late last week, and while the meeting yielded no breakthrough, the symbolism was unmistakable. In the Senate Democrat bill, as previously reported, the goal was to split its sequestration remedy at 50 percent spending cuts, and 50 percent in new taxes. While the tax side focused on a new 30-percent tax on incomes between $1-2 million a year, the savings side is about evenly split between $27.5-billion cuts in direct farm program payments and an identical amount by which defense spending will be reduced. The Republican plan, unveiled just two days before the floor vote, would have required the President to submit by March 15 his plan for alternative targeted spending reductions, and those recommendations could only be negated by a resolution of disapproval approved by Congress. The White House said the GOP claim of flexibility in its bill was bogus and threatened to veto the bill should it reach the President’s desk. On the Democrat plan, which drew heavy criticism from the nation’s largest farm groups, 153 small farm organizations from the Rural Coalition and the National Family Farm Coalition sent a letter to the House and Senate endorsing the Democrat plan; the Environmental Working Group, the National Sustainable Agriculture Coalition and two other groups endorsed it as implementing expected cuts in direct payments and saving money for other priority programs. House Speaker John Boehner (R-OH) said the House has passed two bills to avoid sequester and strongly urged the Senate to act on a plan that would get the two chambers to a conference committee. Sens. Susan Collins (R-ME) and Mark Udall (D-CO) are seeking bipartisan support for a new plan to allow agencies to come up with alternative spending schemes to those mandated by sequestration. These plans would be okayed by House and Senate appropriations committees. Collins said the plan would allow reductions to happen “in a thoughtful way without across-the-board cuts,” and said she hopes the plan can be added to the continuing resolution/omnibus spending bill slated to be considered before March 27.
Immigration reform, stymied in previous congresses over objections to providing the estimated 11 million illegal immigrants in the U.S. a “path to citizenship,” is picking up serious political speed this year, and the first reform bill could see action as early as this spring. A coalition of meat and poultry grower/processing industry groups testified before a House Judiciary Committee subcommittee on immigration, calling for a multi-year visa program for ag workers, stronger border enforcement, improvements in the E-verify hiring system, reworking of anti-discrimination laws, and “options to address the 11 million undocumented workers estimated to be in the U.S.” Meanwhile, House leadership announced a series of listening sessions for members to educate them on the intricacies and challenges of immigration reform. Another major positive in the immigration reform debate is a bipartisan proposal being discussed quietly by House members to create a citizenship pathway that does not anger conservatives. Under the plan, undocumented workers could stay in the U.S. under a provisional system, gaining green cards within a set time frame. These workers would have to be sponsored by employers or relatives who are citizens or legal residents. Once green cards are obtained – providing for legal permanent residence – most workers could apply for full citizenship. There would be no “special” pathway or preferential treatment in granting citizenship, supporters stressed. In the Judiciary panel hearing, the ag groups, represented by the National Chicken Council, also reminded House members that while there’s strong consensus on the need to retain highly skilled workers, experts in science, technology, engineering and mathematics, manufacturers also need assistance in maintaining a viable workforce. The American Farm Bureau Federation told the subcommittee the H-2A season worker visa program doesn’t work, is a resource of last resort for companies, and provides only about 2-3 percent of the seasonal workers needed in agriculture. For its part, the subcommittee showed bipartisan support for reforming federal immigration laws, with Rep. Bob Goodlatte (R-VA), chairman of the Judiciary Committee and former chairman of the House Agriculture Committee, saying the H-2A program is “costly, time-consuming and flawed,” while Rep. Zoe Lofgren (D-CA) said, “If we are honest we must admit that Congress essentially left farmers with no choice but to hire undocumented workers. Let’s not fool ourselves.” House leaders currently are considering moving several targeted bills rather than a single omnibus immigration package, according to reports, starting with consensus issues that include easing barriers for high-tech workers and enactment of some form of the DREAM Act that allows the children of illegal immigrants to get to citizenship faster. The piecemeal approach, however, is getting criticism from those in both the House and Senate trying to forge a consensus on an omnibus package of reforms.
A House Agriculture Committee oversight hearing on the “state of the rural economy,” at which Secretary of Agriculture Tom Vilsack was to appear, was postponed until March 5. The delay was to allow the committee to redirect the hearing to the U.S. Department of Agriculture’s perspectives on sequestration, budget cuts and their impact on USDA programs and services to farmers and ranchers. The committee, in a separate hearing on “budget views and estimates,” revealed it’s concerned about cuts to the federal crop insurance program, inspection programs and disaster assistance programs.
The Senate Agriculture Committee began its re-authorization work on the Commodity Futures Trading Commission, holding a hearing featuring commission Chairman Gary Gensler. Committee Chairwoman Debbie Stabenow (D-MI) made it clear she sees a need for closer regulatory oversight as new Dodd-Frank regulations are rolled out, a bigger CFTC budget and she wants public input on how the commission re-authorization should proceed. Stabenow announced she and committee ranking member Sen. Thad Cochran (R-MS) will release a joint letter inviting the public to comment on the future legislation to reauthorize the CFTC, saying “These markets … must be orderly, transparent, competitive and safe for trading. We must have markets that allow farmers, small businesses and others to manage risk without fear.” On the funding issue, she added, “That also means we need our ‘cops on the beat’ to have the resources they need to do their jobs.” The CFTC’s Gensler echoed Stabenow’s call for more resources, saying his panel is “wrong-sized for the job,” and that due to inadequate funding, the commission is deferring enforcement cases and is backlogged on examinations.
Rep. Henry Waxman (D-CA), ranking member of the House Energy & Commerce Committee, introduced new legislation to require more detailed industry reporting on how antibiotics are used in feed, how much are used on a per-species basis and for what conditions the medicines are included in feed. Waxman was joined in introducing the Delivering Antimicrobial Transparency in Animals Act by Rep. Louise Slaughter (D-NY), a long-time champion for ending the use of “critical” antibiotics in animal agriculture. Waxman says the legislation will allow for collection of more detailed data that will allow FDA to “better understand and interpret trends and variations in antimicrobial resistance and identify interventions for preventing and controlling drug resistance.” The bill requires drug companies to provide more detailed information than currently collected by FDA, and for the first time would require “large-scale” poultry, swine and feedlot operations – those with sales of more than $10 million a year – to provide data on what kinds of antibiotics are used in their feeds, why they’re used and at what dosages. This essentially means integrated poultry companies, large swine growers who privately contract, and big feedlots would do the reporting. Industry critics of the bill say it provides no new or relevant information over that which is currently reported, and that as drafted, the bill reveals a lack of understanding of how animal agriculture operates in the U.S.
The Grocery Manufacturers Association – as part of a broader coalition of food, farm and petroleum industry groups opposed to the Renewable Fuel Standard on ethanol – filed a petition with the U.S. Supreme Court to reverse a D.C. Court of Appeals decision dismissing the coalition’s challenge to the Environmental Protection Agency’s decision to allow ethanol blends in gasoline to be increased to from 10 percent to 15 percent. The group contends in its original suit that EPA exceeded its legal authority under the Clean Air Act in granting a partial waiver allowing the higher ethanol blend. The suit was dismissed because the court decided none of the coalition members could show direct harm from the EPA decision. GMA said the decision on E15 put consumers at “the risk of food insecurity,” tieing the higher blend rate to the long-standing complaint that the RFS, in creating an arbitrary market for corn-based ethanol, puts ethanol refiners and food, feed and other corn users in competition for available supplies, driving up prices, an economic pain ultimately borne by consumers. The higher blend rate makes worse this food-versus-fuel situation at a critical time for producer production costs and food price increases, the group said.
The Reinvesting in Vital Economic Rivers & Waterways Act (RIVER Act) was introduced by Sen. Bob Casey (D-PA), a move, he said, to increase federal investment and re-invent how the federal government maintains and operates locks, dams and other inland waterway projects. The bill also seeks to minimize cost overruns on waterways projects, and proposes an increase in the Inland Waterway User Fee to 29 cents per gallon of fuel, up from the current 20 cents per gallon, or a 45-percent increase, to be effective after 2013. The Waterways Council endorsed the bill, saying it will create a sustainable, cost-effective way to keep inland waterways viable, prioritize completion of navigation projects across the system, improve the U.S. Army Corps of Engineers management of projects, and will create a “sustainable annual appropriation” of $380 million a year, including the lion’s share paid through the user fees.
A 2008 Farm Bill requirement that USDA provide to Congress a report on how various definitions of “rural” play out in department program operations and funding is a good news/bad news situation for House Agriculture Committee Chairman Frank Lucas (R-OK) and committee ranking member Rep. Collin Peterson (D-MN). The committee ordered the report because various programs within USDA defined “rural” differently, and local officials complained it was difficult to determine if their towns and cities qualified for program participation under various definitions. Released more than two years after the statutory deadline, Peterson and Lucas released a joint statement in which they said, “We are pleased that, more than two and half years after it was due, USDA has finally fulfilled its statutory obligation to report on how the various definitions of rural have impacted our rural development programs. The report offers useful insights into issues such as how municipal entities are defined … but we are disappointed in USDA’s proposals to shift money away from most rural areas by inflating the definition across the board. This will result in smaller communities competing with larger and more areas for funding.” The two said “careful targeting of scarce funding” is critical to community benefit from various programs, with clear congressional intent to target monies “at the most rural areas.”
An executive for global retail giant WalMart told an ag audience his company opposes the concept of labeling foods that contain ingredients or are the product of genetic engineering. Speaking at the Ag Issues Forum preceding last week’s Commodity Classic, Rob Kaplin, director of WalMart’s sustainability program, said current food labels are already too complex, including too many “eco” or “trust” messages, and this delivers mixed messages to consumers, Food & Ag Biotech Weekly News reported. Kaplin says WalMart’s priority is labeling that provides accurate information to consumers without increasing costs. He said WalMart wants to work with farm groups to give consumers choice, but also work with farmers to keep food prices low, reminding the audience “the reason they (consumers) shop at our stores is so they can put food on their table for less money.” Kaplin said too many “sustainability” messages focus on negatives, and that farmers already farm sustainably and that message must be communicated to retailers, adding biotechnology represents technology that makes food production sustainable and efficient.