27 June 01 
(Sunup Program to be aired 28 Jun)  

1.                  The House Agriculture Committee has sold the full House on additional aid for farmers.  What’s the latest?

–This week, the House approved $5.5 billion in additional funds for farmers this fiscal year (2001) because of the low market prices.
–It’s important that the Senate act soon because if the funds aren’t disbursed by October 1, they are effectively lost.
–The funds break down like this:
–$4.6 billion in market loss assistance for major commodity program producers
–$424 million for oilseed producers
–$54 million for peanut producers
–$17 million for wool/mohair producers
–If the Senate passes the same package and Bush signs it, AMTA commodity program producers in Oklahoma can count on receiving about 17% less than last year’s assistance, and the checks will come during September. 
–Senate Ag Committee Chair Harkin suggests they will pass an aid package very close to the House version, and soon.

2.         You mentioned Senator Harkin.  The Senate Ag Committee is meeting later today (Thursday). What’s the order of business?

–The announced purpose is to discuss the next farm bill.
–While Harkin had earlier been proposing a 2001 farm bill, rather than a 2002 bill, he’s backed off somewhat.
–Harkin now says he will move quickly, but he hasn’t yet set a timetable.  He may do that today.
–Here are some other points he’s made recently that will likely come up in today’s hearing:
–He likes planting flexibility and wants it in the new bill.
–He wants to improve farm income support, which will lead into a discussion of a counter-cyclical program.
–He wants to increase the cap on CRP from 36 to 40 million acres, and increase funding support for conservation programs.
–He wants to add fruits and vegetables for some form of support.
–He’ll push for global school lunch program.
–He’ll want funding for bio-energy alternatives and wind energy.

3.         How will this fit with what the House Ag Committee has been working on?

–We’ll have a better idea by the end of the week.
–Ranking Minority Leader Stenholm says the House Ag Committee will issue a paper that provides the concepts they want in the next farm bill.
–They’re likely to be very similar to Harkin’s list, although the differences will be important, possibly including targeting and what type of counter-cyclical program to support.

 

4.            Greenspan and the Federal Reserve met this week and   cut interest rates for the sixth time.

–That’s right.  They announced a quarter percent cut.
–While some analysts had been predicting as much as a half percent cut, recent economic data suggests the US is not in a recession, & will begin to climb out of the slump in the coming months.
–Those who wanted a half percent cut pointed to the continuing concerns in the tech industry and factory sectors, where most of the layoffs have come.
–Those who wanted the Fed to stand pat or limit the cut to a quarter percent pointed out that business and consumers are spending as if the economy is doing better, and the fact that fuel prices are dropping.
–The news will be welcome where farm families and rural residents have been affected or concerned they could be affected by industry slowdowns and layoffs.
–This will also be good news for those relying on borrowed capital.

 

5.         We noted last week a Delaware court has ordered Tyson to honor its merger offer with IBP.  What’s been the reaction in Washington?

–Critics of merger-mania have voiced their strong concern about marketing power being concentrated in fewer business hands.
–As we mentioned last week, this could also renew calls for Congress to put a moratorium on mergers in the ag industry.
–In fact, Senator Grassley (R-IOWA) has reintroduced his bill to change the merger review process and give more regulation and enforcement power to USDA.  It also calls for a special counsel for competitive matters to be created in USDA.
–His bill has widespread populist support, but is viewed by the Administration and conservative GOP leadership in Congress as anti-business.

 

6.         USDA Secretary Veneman has been promoting Trade Promotion Authority for the President this week.  Is Congress likely to take this up soon?

–As you mentioned, TPA, earlier known as fast-track authority, gives the Administration the power to negotiate trade agreements with other countries, knowing that Congress can only approve or disapprove but not amend or modify the agreements.
–It’s really the only realistic way to do business, especially when we’re talking about organizations like WTO with over 135 member countries.
–Congress will consider this proposal, probably by October. 
–However, one prominent previous supporter withdrew his support this past week.
–House Ag Committee Chair Combest (R-TX) was miffed when the Administration unilaterally reported to the WTO that 1998 market loss assistance for US producers was trade-distorting.
–That means that similar aid in 1999, 2000 and 2001 will likely also be declared as such.
–The real dilemma is what this does to suggested aid increases being proposed in new farm bill discussions.
–Either the Administration didn’t do its homework, or they’re trying to find an external way to limit farm income aid in the new farm bill.
–In any event, this is serious enough that others in Congress and many of the farm organizations who have earlier expressed support for TPA could revolt.
–This is a story that bears careful watching over the remaining months of this Congressional session.
–If the TPA vote gets pushed into next year, it will get thrown into the election year rhetoric, and no telling where that will end.

7.            Congress:

a.            Recent/Current:

–House Ag subcommittee reviews ag credit (20 Jun)
–House Ag Committee reviews 2001 crop year economic assistance for markup(20 Jun)
–House Ag subcommittee reviews H.R. 2185 “Emergency Food Assistance Program Enhancement Act of 2001" (21 Jun)
–House Ag subcommittee reviews federal farm policy in  Macon, GA, field hearing (23 Jun)
–House Ag subcommittee reviews rural development (26 Jun)
–House Ag subcommittee reviews ag research (27 Jun)
–House Ag subcommittee reviews food stamp program (27 Jun)

 

b.            Upcoming:

–Senate Ag Committee reviews next farm bill (28 Jun)
–House Ag subcommittee reviews forestry programs (28 Jun)
–House Ag subcommittee reviews foreign trade programs (28 Jun)

 

c.            Congressional Calendar:

--As of 2 Jul, about 42 weekdays remain in this Congressional session. 

 

                    June 30 - July 8     Independence Day District Work Period

                    August 4 - Sep 4                      Summer District Work Period

                    September 3                 Labor Day

                    September 18               Rosh Hashanah

                    September 27               Yom Kippur

                    October 5                                Target Adjournment

 

                        d.         Key issues for this session of 107th Congress include:

--dealing w/Social Security, Medicare, Medicaid.
–consider debt reduction & appropriations bills
–campaign finance reform
–education reform
–prescription assistance
–moratoria on mergers in agribusiness
–farm income emergency aid
–Endangered Species Act reform
–energy policy reform
–framing the debate for the 2002 (?) farm bill
–Trade Promotion Authority (TPA–formerly Trade Negotiating Authority TNA, formerly fast track authority FTA)

 

 

 

UPDATE (14 JUN 01)

EXCERPT FROM HOUSE APPROPRIATIONS NEWS RELEASE:

 

The House Appropriations Committee approved Ag spending.

Bill Highlights:

×        FY 01 Funding Level: $18.716 billion* (the 01 number included $3.639 b for natural disaster assistance and other emergency appropriations)

×        FY 02 President’s Request: $15.409 billion

×        FY 02 Bill: $15.669 billion

×        The bill includes full funding of 4.6% pay increases for fiscal year 2002, the level contained in the conference agreement on the budget resolution.  This accounts for many of the account‑level increases above the President’s request, which proposed 3.6% increases.

          Major Amendments Adopted in Full Committee: 

(Hinchey):            Provides $150 million in market loss assistance for apple  producers.

                Supporting Farmers and Rural America:

                                    ×           Farm Service Agency salaries and expenses are increased by $119 million over last year, to continue delivery of the farm ownership, farm   operating, and disaster loan programs.  Total funding is $946 million, which is $7 million above the President’s request.

                                    ×           Agricultural credit programs are increased by $765 million over last year.  Total loan authorization level is $3.855 billion, which is the same as the President’s request.

                                    ×           Rural Housing loan authorizations total loan authorization level is $4.471 billion, which is $5.5 million below last year, and which is the same as the President’s request.

                                    ×           Farm Labor Housing is funded at $31.4 million, which is $1.5 million above last year, and which is $3 million above the President’s request.

                × Rental assistance programs are increased by $15 million over last  year.                                      Total funding is $693.5 million, which is the same as the  President’s request.

                × Rural Electric and Telephone loans are funded at a total loan authorization

level of $4.61 billion, which is $1.5 billion over last year, and $1.5 billion above the President’s request.

                × Distance Learning and Telemedicine Program total loan authorization is

$400 million, which is the same as last year and the same as the President’s request.  Within this amount, $100 million is           appropriated, contingent upon enactment of authorizing legislation, for broadband telecommunication loans, as requested.

                × Agricultural Research Service is funded at $1.05 billion, an increase of

$79.4 million over last year, and an increase of $104.2 million above the President’s request.  Funding is provided to initiate construction of a major facility consolidation and modernization project to meet high national priority animal health programs.

                × Risk Management Agency / Federal Crop Insurance Corporation activities to

implement last years Agricultural Risk Protection Act are fully funded.  RMA is funded at $75.1 million, an increase of $9.7            million over last year and an increase of $0.4 million above the          President’s request.  The Corporation (Mandatory) is funded at $3.037 billion, which is an increase of $232.3 million above last year, and which is the same as the President’s request.

                × Conservation Operations activities are increased by $70.2 million over last

year, bringing FY 02 funding to $782.8 million, an increase of            $9.3 million above the President’s request.

 

                Protecting Human Health and Safety:

                × Food Safety and Inspection Service is increased by $25.5 million over last

year, for a total of $720.7 million, which is $5.1 million above             the President’s request.

                × Food and Drug Administration is funded at $1.218 billion, which is $120.4

million above last year and $7 million above the President’s               request.       

 

                Fulfilling Commitments to Important Food and Nutrition Programs

                × Child Nutrition Programs (Mandatory) are funded at $10.089 billion, which is

$554 million above last year, and which is the same as the                 President’s request.   

                × Special Supplemental Nutrition Program for Women, Infants, and Children

(WIC) is funded at $4.137 billion, an increase of $94 million              above last year and the same as the President’s request.    

                × Food Stamp Program (Mandatory) is funded at $22 billion, an increase of

$1.873 billion above last year, and the same as the President’s request.  The funding includes $1 billion in reserves, as               requested, to be available in the event economic projections are not met.

                × Food for Peace Program (PL 480) is funded at a program level of $835.2

million, which is the same as last year and the same as the               President’s request.

 

 

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