Washington Insider -- Monday

By DTN's Washington Insider

Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.

US ITC Determines Mexican Sugar Imports Harm US Producers

The U.S. International Trade Commission (ITC) determined in a preliminary finding that sugar imports from Mexico harm U.S. producers, a notice on agency’s website says. The Commerce Department is due to issue a preliminary countervailing duty determination by June 23, with a final decision due Sept. 4.

ITC’s preliminary determination, by 5-0 vote, paves the way for the U.S. Commerce Department to continue with its antidumping and countervailing duty investigations. Commerce initiated investigations April 18 after petitions filed by American Sugar Coalition alleged dumping margins of 30% to 64.31%.

U.S. sugar producers filed antidumping and countervailing duty petitions with the ITC in March claiming that Mexico’s actions will cost the industry $1 billion this year. The petitions further noted that efforts by US government officials to keep the market from collapsing under the surge of subsidized Mexican imports cost taxpayers $278 million in FY 2013.

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Stabenow Reveals Strategy for Passing Farm Bill

Getting anything cleared in Congress, especially the Senate is difficult, now and in the recent past. But a nearly $ 1,000-page, $1 trillion farm bill was passed earlier this year. Senate Ag Chairwoman Debbie Stabenow, D-Mich., helped moved that omnibus measure through various hurdles. Speaking with the Associated Press on May 9 she was asked, “What did you do differently to pass the farm bill in the second round of negotiations?”

Stabenow's response: “It was a lot of listening to what people's interests were, trying to find common ground ... Too much of the time right now in politics, people are trying to put the other side in a corner, make sure that you lose. When the Tea Party killed it in 2012, rather than going back and trying to write this in a way they would like, we decided to keep a good bill and just work harder to get support. A lot of what happens today is people change things so that what they're trying to do gets weaker and weaker.”

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Washington Insider: Vilsack Misspeaks on Trade

Agriculture Secretary Tom Vilsack struggled on Wednesday as he assured senators on that the department is on track to implement many of the farm bill's most complex new provisions with one notable exception – creating a new undersecretary's office to manage agricultural trade.

Vilsack told Sen. Mike Johanns, R-Neb., a former agriculture secretary that the proposed reorganization had raised "equities and passions and concerns" among agency staff. Johanns interpreted that to mean the plan had unleashed a turf war within the department. "You're being enormously diplomatic," the Nebraska Republican said. However, he warned Vilsack that even though he is leaving the Senate, "You can't outlast me because there are other advocates who want this to happen," said Johanns.

Vilsack told the Senate group that USDA continues to "educate" Brazil on the new farm bill's cotton provisions--a fairly offensive comment, observers note, especially since he is trying to talk Brazil out of challenging the 2013 bill's new programs that they appear to understand very well. "Those consultations are ongoing and it's my sincere hope and belief that we will continue to work with the Brazilians until we get a resolution and we're hopeful that gets done soon," he told Sen. Saxby Chambliss, R-Ga.

In addition to a number of technical comments on new programs, Vilsack plunged into the fight over Trade Promotion Authority, as "fast track" is called these days, and which is heating up rapidly as Republicans sense an important administration vulnerability in its opposition to this standard negotiating tool. Republicans believe, with considerable evidence, that trading partners won't make concessions to U.S. negotiators until they're sure what they can expect in return--and, that Congress can't spring surprise requirements late in the game.

Democrats also say they are for Fast Track, but, Republicans note, they haven't done much to advance the legislation. Democrats suggest the Republicans have been wanting in their support, as well. So, little progress so far.

Into this standoff, Agriculture Secretary Tom Vilsack sort of blundered Wednesday with the fantastic argument that maybe fast track is not that important after all, and that "getting a trade agreement that addresses the concerns of lawmakers would build support for passing TPA."

"There are two ways to approach Trade Promotion Authority," Vilsack told Johanns at the committee hearing. "You pass it and then you get the agreements, or you get a decent agreement, a good agreement, and then you go to Congress and say, 'Look, you've got this opportunity…let's take advantage of it.' Either way you can get to where you need to be."

Somehow, Vilsack seems to have forgotten that the purpose of Fast Track is to limit micromanaging efforts by groups in Congress who oppose trade liberalization. So, if there are no such groups, then Vilsack may be right. But, only then. And, certainly there are plenty of such groups around today.

It might be useful for Vilsack to think before he speaks, especially about trade where he has been regularly accused of being badly informed and not-much engaged. This clunker certainly will not help that reputation--in fact, it seems likely that he will face a storm of criticism, once his comment reaches escape velocity on the web.

At the least, he has some serious explaining to do about how a proposal that would probably torpedo any ambitious U.S. trade initiative would qualify as a path to "where you need to be" on trade. And, if his explanation is as lame as expected, this view may well be negative enough to cause him great difficulty in performing his job in the future, Washington Insider believes.

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