Washington Insider -- Thursday

By DTN's Washington Insider

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

Dairy Groups May Oppose TPP Without Greater Market Access

U.S. dairy organizations are threatening to withdraw their support for the Trans-Pacific Partnership free trade agreement unless Japan and Canada –– two of the 12 TPP nations –– agree to provide greater market access for U.S. dairy products.

Earlier this week, the National Milk Producers Federation and U.S. Dairy Export Council said their patience on the negotiations has been waning since the beginning of the year, when Japan remained firm on its requests for tariff exemptions of "sensitive" products, like imported rice, wheat, beef, pork, dairy products and sugar. Last week, a number of U.S. non-dairy farm groups suggested that Japan should be eliminated from talks completely if the country refuses to budge on requests to lower tariffs on its wide range of sensitive agricultural products.

Japan has received this message numerous times and trade officials there are well aware of the objections raised by U.S. farm groups. However, it should be kept in mind that Japan's government officials also need to deal with the demands of their own farm lobby which, hard to imagine, is even more powerful (relatively) than the U.S. farm lobby.

***

Reid, Mikulski May Resort to Several 'Minibus' FY15 Appropriations Bundles

Several FY 2015 appropriations bills could be bundled and brought to the Senate floor this summer as a series of "minibuses," Senate Majority Leader Harry Reid, D-Nev., told the press this week. He said that he has discussed such minibus packages with Appropriations Committee Chairwoman Barbara Mikulski, D-Md., as a way to expedite work on the 12 bills to fund the government beginning after Sept. 30.

The word "minibus" derives from the word "omnibus," which is Congress-speak for bundling of all 12 appropriations bills into one package. A minibus, thus, is the bundling of only a few spending measures. The intention is to speed consideration of the bundles rather than spending time on each appropriations bill separately.

Reid has told Mikulski she will have two weeks in June and two weeks in July to bring up the first of the spending bills. The chairwoman says she wants to complete work on 12 bills by the start of the new fiscal year. The odds are against this goal. Since 2000, the Senate has never completed all its assigned work on appropriations measure by the Sept. 30 "deadline."

***

Washington Insider: Rewards for Land Grants

Last week, to the surprise of more than a few observers, Secretary Tom Vilsack announced that USDA is awarding some $6 million to universities and cooperative state extension services to develop online decision tools and train experts to educate producers about key new farm bill programs.

In the statement, Vilsack described the beneficiary institutions and the amounts they will receive, and he obviously expected the program to be popular. Cynics observed that the participants appeared to be mainly the usual land grant insiders. Still, the secretary argued that the program is essential to help producers make critical decisions and to select the plan that best fits their unique needs.

A key area of focus for the effort is producers' opportunity to choose between the new Agriculture Risk Coverage and the Price Loss Coverage, so Vilsack talked about the planned online tools to help producers use data "unique to their specific farming operations combined with factors like the geographical diversity of crops, soils, weather and climates across the country to test a variety of financial scenarios before officially signing up for the new program options later this year."

This decision is especially important, he said, because once a producer enrolls in the ARC or PLC the commitment lasts through the 2018 crop year. Also, navigating the new Margin Protection Program for Dairy is to be aided by that online "MPP tool."

USDA's release of its list of institutions that will participate in the program as well as those that will lead the main endeavors emphasized the reach of the modern land grant system and brought a reminder that it wasn't too long ago that pundits, observing the vast amount of research and extension performed by private firms, began to ask whether the land grants would be needed in the future. While advocates for those institutions continue to plead poverty as they have done regularly since time immemorial, they clearly have managed to invest very considerable amounts in their own infrastructure.

It is fair to note, however, that the secretary's announcement raised eyebrows in several quarters. Why is this new money needed, one line of inquiry goes, given all the research and information structure now in place along with the current funding? Isn't the system already in use supposed to be giving producers the help this award promises to generate?

Others wonder why the secretary did not enlist USDA's internal systems to provide much of the help needed. Why not turn to them?

Other criticisms are appearing here and there, including why is the grant so specific, aimed apparently at the mechanics of a few particular decisions, rather than at more general public policy questions, such as the broader implications of the law for trade; for farm structure, organization and investment? Even more fundamental is a questioning of the role and consequences of the new subsidies the farm bill will provide relative to what is intended to be a modern, highly competitive sector.

Because the ag leaders in Congress were forced to dump the old, totally discredited direct payments policies they had created in 1996, a large block of spending was freed up for new programs. Under congressional rules, the availability of these funds, in spite of tight-overall budgets, prevented the development of much of a budget fight over trade-offs for the ag programs — although many stakeholders wanted more meaningful debates than were held.

Now, as the dust is settling, USDA is recruiting the Land Grants to simplify the complexities Congress built into the programs — and, it seems, to do so while continuing to ignore the same complexities it ignored before. It will be interesting to see how enthusiastically and for how long the Land Grant economists follow that money toward these new, very narrow definitions of policy (really program) analysis while creating this new "super extension" system, Washington Insider believes.

---

Want to keep up with events in Washington and elsewhere throughout the day? See DTN Top Stories, our frequently updated summary of news developments of interest to producers. You can find DTN Top Stories in DTN Ag News, which is on the Main Menu on classic DTN products, on the News Menu on Farm Dayta, and on the News and Analysis Menu of DTN's newest Professional and Producer products. DTN Top Stories is also on the home page and news home page of online.dtn.com.

If you have questions for DTN Washington Insider, please email edit@telventdtn.com

(CC)

Copyright 2014 DTN/The Progressive Farmer. All rights reserved.