Washington Insider -- Thursday

Pressure to Complete the New NAFTA

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

FERC Approves Temporary Emergency Shipment of Propane to Midwest

Temporary emergency shipment of propane from Texas to the Midwest has been approved by the Federal Energy Regulatory Commission (FERC).

The pipeline company asking for the action said “record demand for propane is due to an unusual coincident increase in heating demand, resulting from unseasonably cold weather in the region, and crop drying demand.”

There were no comments or protests filed on the request and FERC determined the matter is accepted effective November 13.

In addition, FERC announced it will “initiate an alternative dispute resolution (ADR) process with pipeline companies, shippers and their representatives to explore actions FERC and industry can take to alleviate propane pipeline constraints in the Midwest.”


Farm Credit System Weathering Farm Income Situation

Officials from the Farm Credit System testified before a House Ag subcommittee Tuesday, telling the panel the ag lender is so far weathering the farm income difficulties.

Large payouts to farmers under the Market Facilitation Program (MFP) are providing help, officials said, but they noted that farm debt has grown some $41 billion in the last three years. The farm bill safety net programs are working as they should, officials said.

USDA next week will update its farm income forecast for 2019 and issue its outlook for 2020 and that is expected to continue to show that government payments are making up a greater share of U.S. farm income. But, conditions remain better than those seen in the 1980s.


Washington Insider: Pressure to Complete the New NAFTA

Pressures are building on Democrats from rural areas, many of whom face tough re-elections in 2020, Bloomberg is reporting this week. This group is “pushing their party leaders to complete the U.S., Mexico, Canada trade pact before the end of the year to give them a solid legislative achievement—but also to “undercut GOP criticism that they are doing nothing but impeachment.”

“It’s only going to get harder to make a good deal as we get closer and closer to the presidential election,” said Rep. Ben McAdams, D-Utah. “There’s a window right now to get it done.”

An agreement between House leaders and U.S. Trade Representative Robert Lighthizer is close to being done with enforcement provisions on labor and environment still being ironed out, Bloomberg said. AFL-CIO President Richard Trumka met with freshman Democrats on Tuesday morning to convey the message that it’s important to strengthen labor enforcement in the final deal.

Rep. Cindy Axne, D-Iowa, said she told Trumka that while she supported the enforcement of labor regulations, farmers and manufacturers in her district were hurting due to the trade war and tariffs, which a new trade agreement would alleviate.

“The longer we wait, [the more] it increases the pain the folks in Iowa like our farmers are getting right now,” she said.

Several lawmakers alluded to criticism that they were doing little besides impeachment. President Trump has branded them “Do-Nothing Democrats” despite the 100-plus bills the House passed this year, Bloomberg said.

“I was sent here by the people of my district to get things done and one of those big-ticket items is a solid trade deal with Mexico and Canada,” Rep. Anthony Brindisi, D-N.Y., said, leaving the meeting with Trumka. “That’s what my district wants and that’s what I’m trying to get towards.”

McAdams said an agreement might be “even more important now, in light of the impeachment inquiry, that we show our constituents that we are still moving forward legislation that is good for the public.”

Other lawmakers are working to calm the anxieties of the freshmen by emphasizing the need for not merely a good deal but one they can stand behind for decades.

Rep. Elissa Slotkin, D-Mich., said veteran House members warned her they were still facing negative reaction from their 1993 vote on NAFTA.

“The senior members are making it very clear that we all understand the stakes,” she said.

Rep. Jimmy Gomez, D-Calif., a member of the group of Democrats meeting with Lighthizer, said the freshmen haven’t been shy about making their needs known. “They’re feeling a lot of pressure,” he said. “But in the end, they still need a good agreement to vote for and something they don’t have to run away from.”

The trade deal still could get done before the end of the year, although it’s competing for attention and floor time with the impeachment inquiry and with work on an agreement on how to fund the government for the rest of Fiscal Year (FY) 2020. The House passed another continuing resolution Tuesday to fund the government until Dec. 20.

Draft language for the trade agreement is being exchanged, Gomez said, and added that the final language could be complete a few days after a final agreement is reached. “Anything is possible, to be honest with you,” he said.

So, we will see. Observers argue that work is progressing steadily on the new NAFTA, even though they say they recognize that pressure for speed is often the “enemy of a thoroughly vetted and refined final product.”

Nevertheless, there seems to be growing optimism regarding the evolving deal, so the process is one producers should continue to watch closely as it progresses, Washington Insider believes.


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(GH/CZ)