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.

A Busy Week for Congressional Appropriators

Appropriations bills are moving forward in both the House and Senate where legislators are scheduled this week to mark up bills for USDA, the Food and Drug Administration and related agencies. It is expected that there will be robust debates in both chambers when the subject of funding for nutrition initiatives –– such as the school breakfast and lunch programs and the Women, Infants and Children (WIC) program –– is brought forward. House Agriculture Appropriations Subcommittee Chairman Robert Aderholt, R-Ala., plans to mark up that his version of the bill beginning tomorrow morning.

Looking at the broader subject of fiscal 2015 appropriations measures overall, Senate Appropriations Chairwoman Barbara Mikulski, D-Md., says she is beginning a push to move up to half of the 12 regular spending bills by mid-June in order to have them ready for Majority Leader Harry Reid, D-Nev., to bring up on the floor shortly thereafter.

Mikulski has set an ambitious goal of completing work on all 12 appropriations measures by Oct. 1, when the government's new fiscal year begins. This is ambitious because, as Mikulski has pointed out, that deadline has not been met since 1996.

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S&P Forecasts New Economic Effects of Climate Change

Global warming will harm the creditworthiness of countries around the world this century, with poorer nations the worst hit, Standard & Poor's Ratings Services reported last week. And, says the report, climate change also will hit countries' economic growth rates, their external performance and public finances.

Recent bouts of extreme weather around the world have drawn attention to the financial and economic effects of climate change. They have also highlighted the growing cost of natural disasters. According to one reinsurer, overall losses in East Asia, for instance, used to be below $10 billion per year, but over the past decade have regularly topped $20 billion, and more recently peaked at over $50 billion.

Meanwhile, the Organization for Economic Cooperation and Development (OECD) said that the costs of natural and man-made disasters have more than doubled in the last ten years, rising to $1.5 trillion in damages and economic losses.

These forecasts and similar ones are likely to gain the attention of government policymakers and could affect future plans to deal with the effects of climate change, even in those countries where climate change is not a settled matter.

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Washington Insider: Verifying Label Claims for Social Concerns

At a time when advocacy groups are pushing hard to establish in law consumers' "right to know," an animal welfare group is suggesting that more attention should be paid to how labels are supported. The group is highly critical of what they call "big gaps" in information used to verify label claims about humane treatment for animals.

The Animal Welfare Institute (AWI) says it spent three years pursuing documentation from USDA about private company claims that their animals are "well cared for or raised in accordance with high environmental standards." The response was poor, however. USDA failed to come up documentation for 20 of the 25 claims examined and for the others the documentation was "inadequate," often only a one- or two-sentence statement that the animals were being raised appropriately with no additional information about animal cage size, feed or water quality or other facts. The label claims being investigated were for livestock "Humanely Raised and Handled" to "Sustainably Farmed."

AWI says this is not necessarily proof that the claims were misused, Dena Jones, manager of AWI's Farm Animal Program told the press. "But that's the problem — we don't know," she notes. "That doesn't give any assurance to the consumer." She is certainly right about that.

The lack of verification is a problem for groups that argue that such labels add value to products. For example, the online grocery service FreshDirect sells its own brand of boneless, skinless chicken breast cutlets — raised without antibiotics — for $6.99 per pound but they also market a "humanely raised and organic" competitor's cutlets for $11.99 per pound.

Jones argues that, "to most people, claims about animal treatment mean you are getting something above the standard of conventional industry." And with such prices at stake, companies should have to prove it, she says.

Indeed, this type of label has become a major attraction for consumers according to Christopher Ely, co-founder and farmer liaison for Applegate, which makes meat and dairy products, many of which are certified organic. "Everybody is jumping in."

Many companies pay an outside organization to supply guidelines and perform audits to make sure their practices comply with the statements on their labels. However, AWI now believes many offer exaggerated — or very vague — claims, Jones notes. Even among certification groups, standards vary widely for many of these terms.

"There aren't scientifically established and consumer-agreed-upon definitions for 'humanely raised' or 'sustainably raised'," says Lindy Miller, an agricultural extension educator at Purdue University. "So it becomes very hard to write or enforce regulations." This leaves the marketplace in what he charitably calls "moderate chaos" — as it was a couple decades ago for the term "organic" before USDA took over a centralized labeling program.

Terms such as "humane" and "sustainable" are far murkier, he says, and open to interpretation. "It's not like 'cage-free' or 'free-range,'" which have relatively specific, self-explanatory implications.

Applegate was one of the 20 companies for which USDA failed to supply any documentation supporting a "humanely raised" label. Jones says that the company had previously verified that claim through Certified Humane but no longer does and now allows its individual producers to select their certification process. Nevertheless, he assures that each of its producers does get verified for humane handling. He also asserts that they file thorough documentation with the USDA each time they apply for a new product label to be approved.

Observers note that accurate evaluations of how an animal was raised become even trickier in reality when the company requesting label approval is rarely the same one that has actually raised the animal. Most major distributors buy their animals from suppliers all over the country. Applegate, for example, might acquire animals from 1,500 different individual farms this year alone, Ely notes.

At the same time, USDA, with its main responsibility of ensuring that food is safe and unadulterated, lacks authority or resources to regulate or inspect animal-raising facilities, according to Catherine Cochran, a USDA spokesperson. She added that they do "require processors to substantiate that they meet the claims presented on their product labels," but apparently the department was not able to round up the paperwork in response to AWI's request.

As a result, AWI told the press it plans to submit a petition to request that the USDA require third-party certification for all labeling claims about sustainability and animal welfare.

There's something fundamentally odd about certifications, official or commercial, when they concern conditions no one can define. It is one thing to certify that layer cages with at least minimum dimensions were used, but another when broad concepts like "humane" or "sustainable" are the basis for a valuable brand. As a result, the AWI controversy raises questions about how useful efforts to satisfy "consumers' right to know" are when they lead to labels with only vague assertions.

It is past time for USDA to undertake a careful audit of its programs and those of others and either pull those labels back to specifics that can be verified or abandon those that are conferred by the stroke of a hired hand's pen –– designations unworthy of any special certification or label regardless of how socially desirable more humane or more sustainable programs might be, Washington Insider believes.

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