Washington Insider -- Wednesday

Senate Ready to Take Up Disaster Relief

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

Odds May Be Declining For US Purchases of Ag Goods To Donate

The tweet by President Donald Trump that the U.S. may buy up commodities and donate them is appearing to be waning as a possibility.

U.S. law requires an analysis of whether the receiving country would be able to store the inbound foodstuffs, to prevent them from rotting, and for the U.S. to assess whether the aid would undermine local farmers, according to a report by the Congressional Research Service.

Expectations are that other exporting countries would likely raise objections to any program as export subsidies, which are banned under World Trade Organization rules.

President Trump said on Monday that his administration was planning to provide about $15 billion in aid to help U.S. farmers whose products may be targeted with tariffs by China in a deepening trade war. "We are going to take the highest year, the biggest purchase that China has ever made with our farmers, which is about $15 billion, and do something reciprocal to our farmers so our farmers can do well," Trump told reporters at the White House.

China announced additional tariffs on US goods effective June 1

China announced Monday that as of June 1, it would raise tariffs on $60 billion of US goods. The tariff increases would hit a wide range of sectors ranging from manufacturing to agriculture and household goods.

China said 2,493 items coming from the US would see tariffs of 25%, including liquefied natural gas (LNG), agricultural items and more. China also said that tariffs on another 1,078 goods would see tariffs of 20% and another 974 products would have tariffs of 10%. Those lists included household goods, along with apparel and related manufacturing equipment.

A smaller list of 595 items would not see an increase beyond the present level of 5%.

However, President Donald Trump indicated he would meet with Chinese President Xi Jinping while at the G20 summit in Japan in late-June.

"Maybe something will happen," Trump told reporters at the White House. "We are going to be meeting, as you know, at the G20 in Japan and that will be, I think, probably a very fruitful meeting."

Washington Insider: Senate Ready to Take Up Disaster Relief

With little notice, amid the discussions over the U.S.-China trade talk collapse, the House passed the “Trump-opposed” disaster-relief bill with more funding for Puerto Rico, Bloomberg and others reported recently.

Bloomberg also said that in spite of Republican opposition, Senate Majority Leader Mitch McConnell, R-Ky., is now urging lawmakers to come together on a bipartisan disaster relief bill saying that “Americans who have suffered have been waiting too long for relief.”

McConnell, in opening floor comment on Tuesday said that disaster assistance has never before been a partisan issue and “our country is in need.”

The House overwhelmingly passed the $19.1 billion relief bill Friday to provide federal aid to communities and military installations hit hard by natural disasters, ignoring President Trump’s opposition to the package over its assistance for Puerto Rico.

In the debate, the President told Republicans to “reject the disaster bill” but the House did not and neither did thirty-four Republicans who joined all of the chamber’s Democrats to pass package, 257 to 150. Some of the most loyal conservative supporters broke with the president, favoring their districts’ needs over his demands. Among them were Rep. Steve King, R-Iowa, and lawmakers from Nebraska, Georgia and Texas.

The strong bipartisan vote reflected the anger and frustration of constituents as disaster relief legislation has stalled in Congress for months and Senate Republicans have failed to come up with an alternative package in their negotiations with the White House.

The major sticking point in the disaster bill for the president is the additional funding included to help Puerto Rico rebuild after Hurricane Maria severely damaged the island and left an eventual death toll of “around 3,000”. The additional funding amounts to more than $3 billion, including $600 million for nutritional assistance.

Amid the recent delays, new complications have emerged. The White House wants the disaster-relief bill to include $4.5 billion in emergency border spending to be used for humanitarian and security purposes, a proposal many lawmakers oppose.

Separately, the chairman of the Senate Appropriations Committee, Sen. Richard Shelby, R-Ala., and the administration are at odds over the Harbor Maintenance Trust Fund, which collects fees from users to pay for upgrades at ports. Shelby hopes to include language in the disaster aid bill that would make it easier to spend money in the fund, noting that repairs are badly needed at ports that have been affected by recent hurricanes. But White House officials oppose Shelby’s approach, saying he is just looking for a way to spend more money.

Further complicating the negotiations, Shelby has expressed exasperation with the White House, openly questioning whether acting White House chief of staff Mick Mulvaney is playing a constructive role in talks.

The President repeatedly pushed back against giving more money to Puerto Rico and at a rally this week in the Florida Panhandle, an area hit hard by Hurricane Michael in 2018, he “incorrectly” suggested that giving more money to Puerto Rico would shrink the pool for other areas that need disaster assistance, Bloomberg said. In fact, the disaster aid bill would specifically allocate money for each district and project, such as repairing Tyndall Air Force Base, and not force communities to compete for aid.

Senate Republicans have indicated a willingness to support more funding for Puerto Rico, but it is unclear whether the White House would agree.

Rep. Nydia M. Velázquez, D-N.Y., the first Puerto Rican woman to be elected to Congress, said in a floor speech that denying aid to those suffering in Puerto Rico is immoral and against American values.

“I pray, pray this bill, which rightfully assists so many other parts of the union, of our nation, will motivate the Senate at last to act and the president to sign this badly needed aid into law,” Velázquez said. “This is a matter of life and death for so many in Puerto Rico.”

Some House Republicans said they voted against the bill because it does not include border funding, Bloomberg noted—but other Republicans, mostly representing areas affected by natural disasters, voted to advance the bill.

Rep. Jeff Fortenberry, R-Neb., whose state experienced severe flooding in March, spoke in favor of a bipartisan amendment to add money for watershed protection and then voted for the underlying bill.

Fortenberry and King were joined by Republican conservatives including Reps. Dan Crenshaw and Michael McCaul of Texas, Doug LaMalfa of California., and Earl L. “Buddy” Carter of Georgia.

Dismissing the rebuke implied in the vote, the President tweeted Friday afternoon, “Great Republican vote today on Disaster Relief Bill. We will now work out a bipartisan solution that gets relief for our great States and Farmers. Thank you to all. Get me a Bill that I can quickly sign!”

The House bill is a revised version of one passed in January that was not taken up by the Senate, over objections to the additional Puerto Rico aid.

“We can’t let partisan politics stall this crucial bill, and we must not turn our backs on our communities when they’re recovering from devastating damages,” said Rep. Cindy Axne, D-Iowa. “That’s not who we are as Iowans, and that’s not who we are as Americans.”

Certainly, the bill’s chances look a lot better than they did a few days ago as the Senate now appears ready to move quickly on the issue — a fight producers should watch closely as it intensifies, Washington Insider believes.

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