Ag Policy UpdateB16 JAN 02        

(Sunup Program to be aired 17 JAN 02)

 

 

1.         President Bush gave his State of the Union speech this week. Give us your overview of the talk.

 

BMost Americans now know his 3 key priorities are winning the war, defending the homeland, & reviving the economy.

BThere was only one sentence about agriculture and farm policy.

BThere were a few comments about the environment and energy.

BThere was a strong request for Congress to provide him with the authority to negotiate trade agreementsBTrade Promotion Authority (formerly known as fast-track).

 

BHis talk was as much about the state of George W. Bush as it was about the state of the union.

BIn defining himself as a wartime leader, he defined America by contrasting it with the evil of our attackersBreal and would-be.

 

BIf agriculture has a place in his policy agenda, it will be framed by these 3 goalsBwinning the war, defending the homeland & reviving the economy.

 

BIt was a speech more about values than vision, and those values were defined by how we as Americans respond to attacks and threats of attack on freedom.

2.         House Minority Leader Gephart gave the Democrats= response.  What did you hear in his talk?

 

BDemos will stand shoulder-to-shoulder with Bush on the war, but not necessarily on domestic policy.

BThe Demos will be the loyal opposition and he kept repeating Awe want to work together@.

 

BIt=s hard to argue with the President=s themes of God-Mom & Apple Pie, & his high approval rating.

BSo, Gephart=s talk was more about working together than highlighting differences.

 

 

3.      Does this mean the President won=t have much trouble with his agenda this year?

 

BThe budget Bush sends to Congress next week will be where we see the differences.

BIt will ask more for the military & the war, & the Demos will say AYes, but at what cost?@

Bit will ask for more for homeland defense, & the Demos will say AYes, but we recommended this 3 months ago.  Why not then?@

BIt will ask for more/permanent tax cuts, & the Demos will say AYes, but to whom, how much and for what purpose?@ & especially, AWhy, Mr. President, do you want to give Enron & its evil execs a tax cut?@

BIt will ask for health care reform & prescription drug benefits, & the Demos will say, AYes, that=s our issue.  We want more change and more funds than the GOP.@

BIt will ask for corporate and retirement fund reform and oversight, & the Demos will say, AYes, we=ve been seeking that for years, only to be stymied by Republicans.@

BIt will ask for funds for agriculture, & the Demos will say AYes, of course, but who will get the money?@

4.      You mentioned the economy.  The Fed also met this week and decided yesterday to not change interest rates.  Were you surprised?

 

BI noted last week that the Fed might wait to see how the economy is doing.

BI think they=re near the bottom on lowering rates.

BThey may lower them one more time, but the question is when.

     BEconomic indicators remain mixed.

BThe economy apparently grew slightly in the last quarter of 2001, so we may technically be out of recession.

BHowever, manufacturing and industry remain soft and occasional layoffs will continue.

BThe Dow had a significant drop this week.  Whether that was in anticipation of the President=s talk or concerns related to the Enron scandal is uncertain.

BInflation was at a 3-year low in 2001, with consumer prices falling in December.

5.         Finally, any news to report on the farm bill?

 

BSome analysts remain optimistic that there will be a new farm bill by April.

BRepublicans Cochran & Roberts have indicate they will not likely push their bill, so it will be between the House and Senate versions.

BThe Demos are pushing for higher loan rates and Harkin=s conservation provisions.

BThat could provide an outline for compromise soon.

BThe Republicans have over 50 amendments they want heard, and Demos also have several.

BUnless these are procedurally set aside, the process will take time, even if a compromise has been crafted.

5.         Other policy-related news:

--USDA will permit a 1-year extension on CRP contracts expiring this year.  Contracts expiring 30 Sep will be able to apply for the extension between 14 Jan & 31 May of 2002.  About 1.8 million acres on 30,000 contracts are affected. The limiting factor is that the extension cannot exceed the 15 year limit.  While no general signup is planned for this year, the continuous signup for special acreage is ongoing.  See your local FSA office for more info.

6.         Congress:

a.         Recent activity:

BCongress convened the 2d Session of the 107^th Congress last week (23 Jan)

BState of the Union (29 Jan)

         b.         Current/upcoming:

BExpect little business until party retreats are done this week and President=s Budget delivered next week.

BSeveral committees have initiated investigations of various aspects of the Enron scandal.

BHouse Ag Committee subcommittee reviews implementation of Ag Risk Protection Act (13 Feb).

BInformal negotiations on next farm bill continue.

     c.         2002 Schedule:

             Target adjournment             4 Oct

     d.         Key issues:

             BTrade Promotion Authority

BNew farm bill

BBioterrorism & homeland defense

BHealthcare reform

BPrescription drug benefits

BCorporate & retirement plans reform/oversight

BCampaign Finance Reform

BMerger activities, especially in agriculture

BEconomic stimulus

 

 

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