Washington Insider -- Tuesday

Budget Stalemate Continues

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

Vilsack Supports and Pushes TPP Approval

The proposed Trans-Pacific Partnership (TPP) agreement, which now awaits approval by Congress, was strongly advocated by USDA Sec. Tom Vilsack during comments made at the Commodity Classic. “I’m a strong, unapologetic proponent of the TPP agreement,” Vilsack said. “The region has ten times the population of the United States.”

The TPP sets a framework for a level playing field for trade, science-based decision making and high standards for labor, the environment and sanitary-phytosanitary rules, Vilsack detailed. “We have science, not politics, with this agreement,” he noted. “We can increase farm opportunity, but don’t take it from me, the American Farm Bureau Federation has done a study on the impact of the agreement.” That report said that TPP would increase farm income by $4.4 billion and increase exports by $357 billion.

Vilsack said there is really no time to waste for two reasons:

1. China is trying to negotiate its own agreement with Asian friends that Vilsack says will not offer US a level trade playing field, won’t have the same sanitary-phytosanitary rules and not be science based.

2. Delaying the agreement for just a year would cost the American economy $94 billion.

Despite Vilsack’s remarks, the Senate will not take up the TPP at least until after Nov. 8 elections, perhaps in a lame-duck session of Congress. However, should the Republicans lose control of the chamber, some sources say current Majority Leader Mitch McConnell, R-Ky., will let the Democrats take up the matter in a new 2017 Congress.


Supreme Court Review Sought on Clean Water Act Determinations

Judicial reviewability of approved jurisdictional determination’s (AJD) under the Clean Water Act (CWA) is being sought by a Minnesota peat farmer and briefs in support of the move have been filed with the Supreme Court by trade organizations, industry groups, as well as state and local governments.

Jurisdictional determinations regarding whether land contains wetlands are made under the CWA by the US Army Corps of Engineers (Army Corps). A Minnesota peat farmer has filed a case that contends that such an AJD should be considered a “binding” final agency action and thus subject to judicial review.

The implications of judicial review for AJDs are widespread. “The government argues AJDs are not judicially reviewable because they do not direct recipients to take any particular action, But AJDs establish sharp lines that have direct, powerful, and coercive effects on how their recipients proceed,” a brief filed by lawyers on behalf of the Foundation for Freedom and Economic Progress and Utility Water Act Group noted.

Government briefs argue Army Corps decisions are not judicially reviewable, because while they mark the consummation of the agency’s decision process, no “rights or obligations have been determined” and no “legal consequences will flow” from the determination.

State, county and city governments filing briefs in support of granting judicial review for AJDs said that such reviewability is needed to ensure certainty in planning decisions and that unilateral changes regarding jurisdictional authority impede decision making processes. The states specifically cite federalism concerns noting that “the Corps’ position would raise serious federalism concerns in light of the States’ traditional role in land and water use management.”

The matter is before the Supreme Court after differing rulings were handed down by multiple U.S. circuit courts. The Eighth Circuit in St. Louis found in favor of the plaintiff, while the Fifth Circuit in New Orleans and Ninth Circuit in San Francisco found in favor of the government. Oral arguments on the case are scheduled for March 30.


Washington Insider: Budget Stalemate Continues

The urban press is watching closely these days as the Congressional leadership struggles to follow through on promises regarding budgets. Last week, the news was that House Republicans had to admit that they were “no closer to agreement on a budget plan after their closed-door meeting last Thursday,” The Hill reported.

The key focus in that meeting was a plan by House Budget Committee Chairman Tom Price, R-Ga., who proposed to keep spending levels set by last fall’s deal with the White House by using offsets to allow an extra $30 billion in spending in a legislative “sidecar.”

Still, The Hill reported, the Budget Committee did not offer details about how to achieve those savings in a way that would appease both fiscal and defense hawks, as fiscal hawks push for further spending cuts that defense hawks oppose.

The Hill also reported that the latest meeting, “with its lack of specifics, raises doubts about the party’s prospects of passing a fiscal blueprint this year.”

The continuing budget stalemate raises the odds that Congress again would have to pass some kind of omnibus spending bill to keep the government running past September. Rep. Bill Flores, R-Texas, chair of the House Republican Study Committee, commented that “The level of specificity that we need to make a decision about how to proceed, we don’t have that information,” he said.

One of the new tactics discussed during the closed-door meeting on March 3 involved changes to the House’s rules to restrict spending, The Hill reported. Four rules were highlighted, including one that would prevent any bill from increasing mandatory spending. Another would prevent the House from approving spending for any unauthorized program or agency. “Those are two or three ideas that would get a lot of people comfortable with the direction that [Price] is trying to go,” Flores said.

Another approach would be for Ryan to formally task House committees to write bills that find savings to be used to offset the budget, House Appropriations Committee Chairman Hal Rogers, R-Ky., said. “It would be similar to the budget reconciliation approach used by the House last year.”

However, the presentation by Price, along with one by House Rules Committee Chairman Tom McClintock, R-Calif., did not seem to smooth over tensions between the party’s defense and fiscal hawks. “We’re still discussing the way ahead to make sure the agreement we reached last December is still the agreement,” said Rep. Mac Thornberry, R-Texas, chairman of the House Armed Services Committee, who supports the higher spending told The Hill. “[But] there are some people who don’t agree with the agreement.”

The House was not alone in its budget difficulties. Senate Budget Committee Mike Enzi, R-Wyo., announced that his committee will postpone possible action this month but “will continue to discuss their options.” He argued that the Senate can pass appropriations bills even without a budget resolution because the top-line spending numbers were set in last year’s budget deal.

The Hill notes that “vulnerable GOP incumbents who are not eager to take politically charged votes this spring have made the same argument.” However, it undercuts the pledge by Senate Majority Leader Mitch McConnell, R-Ky., that Republicans would make “a major effort” to pass a budget and had repeatedly noted “it’s required by law.”

Also, Republicans had regularly bashed Democrats when they controlled the chamber for skipping budgets. McConnell had pledged in 2014 that Republicans would pass a budget every year if they won control of the Senate.

Cynics note that there is little new in these battles and that they have been going on for years. At the same time, it is fair to note that frenzied efforts to accomplish political goals often lead to legislative logrolling and possibly deals with serious unexpected consequences. In the current environment with a broad range of crucial issues concerning agriculture on the table, producers should watch the evolving budget debate carefully for the smoke and mirrors typically employed by both parties at such times, Washington Insider believes.

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