Washington Insider-- Tuesday

Watching for Signs of Recovery

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

Vilsack Outlines Expectations On Climate Efforts

USDA Secretary Tom Vilsack said that climate-smart ag policies will include initial moves to harness existing conservation programs like the Conservation Reserve Program (CRP).

“Congress has basically authorized and approved up to [25] million acres to go into that program,” he explained. The data on what is currently in CRP is 20.8 million at the end of January, Enrolling an additional 4 million acres to meet the cap can “begin the process of addressing some of the challenges that we face” related to climate, he said.

USDA may work with states to come up with ways to encourage farmers to enroll more marginal lands in CRP, potentially including additional incentive payments. A key will be ensuring a balance between promoting climate goals and not distorting markets in regions across the country, he added.

For CRP and other USDA conservation programs, Vilsack said he hopes to focus them on climate-smart ag practices. “We need to provide incentives, we need to provide resources, we need to provide cost-share for all the activities that are currently taking place and see if we can expand them and build upon them.”

Vilsack reiterated that harnessing carbon markets will be another focus and ensuring they serve the needs of farmers will be critical. “You can set up the prototype if you will, or the pilot, and then see how it works,” he said of an ag carbon bank, suggesting the move could tap extra funds from the Commodity Credit Corporation (CCC). Should the pilots prove successful “then we basically go back to Congress and say, 'How can we get this thing ramped up to a point where more and more farmers are participating?'”

Vilsack: Mexico GMO Restrictions Won't Affect Feed

Asked how he will respond to Mexico's plan to stop importing genetically modified (GM) corn, USDA Secretary Tom Vilsack said Friday that Mexico is only considering such a ban for corn used in human food products, not animal feed.

He called the distinction a “big difference here to producers in the United States.” He has been in contact with his Mexican counterpart and U.S. Trade Representative Katherine Tai on the GM corn issue, noting the U.S.-Mexico-Canada Agreement (USMCA) includes provisions for formal consultations, and, if needed, a dispute resolution process. However, he stressed, “we're not anywhere near there yet,” referring to invoking dispute settlement provisions of the trade pact. “We're just having these conversations.”

Bottom line, Vilsack said, “It is important to distinguish between what Mexico is currently thinking about doing, and the fact that it's not going to have as great an impact it would if it was everything all at once, all right now,” referring to fears of a broader GM corn import ban.

This appears to clarify a situation which has caused major concern on the potential for U.S. corn and soybean exports to Mexico to be affected.

Washington Insider: Watching for Signs of Recovery

Bloomberg is expecting more political fireworks this week as the Biden administration reveals some of the main elements of its coming infrastructure plan.

President Joe Biden is expected to describe the “scope and ambition of his plans to expand and reorient the U.S. government, setting the stage for a bitter fight on Capitol Hill that could define his presidency.”

Bloomberg said it expects the president will unveil the framework for a major infrastructure-and-jobs program Wednesday in Pittsburgh. Later this week he is expected to offer the first glimpse of his 2022 budget — which promises to redirect federal funds to areas such as climate change and health care.

The announcements will include the first concrete details of the administration plan to overhaul federal spending, in a sales pitch without the immediacy of the pandemic emergency that he had for his first package. To succeed, it will have to convince the public and lawmakers on a multi-trillion-dollar investment in infrastructure and social safety nets, along with a revamp of the tax code to help address funding needs and widening inequality, Bloomberg said.

“Successful presidents — better than me — have been successful in large part because they know how to time what they're doing,” Biden said Thursday when asked why he was pursuing the massive spending package instead of other legislative priorities, such as gun control. Infrastructure is “the place where we will be able to significantly increase American productivity, at the same time providing really good jobs.”

While Biden has made clear his plans will include tax-policy changes to help fund what aides have laid out as a roughly $3 trillion long-term program, how specific he'll be on Wednesday is uncertain. His budget plan also won't include a comprehensive breakdown about the agency-by-agency spending increases the administration is seeking.

“What the American people will hear from him this week is that part of his plan, the first step of his plan towards recovery which will include an investment in infrastructure,” said White House Press Secretary Jen Psaki, referring to plans for two separate proposals. “He's going to have more to say later in April about the second part of his recovery plan,” she added, which will include health care, childcare, and other social issues.

They're “not quite at the legislative strategy yet,” and “the total package” is still being worked out,” she said. “But he's going to introduce some ways to pay for that, and he's eager to hear ideas from both parties as well,” she said.

Bloomberg also says that a vehicle “miles traveled tax is no longer on the table as an option to pay for infrastructure projects.” After Transportation Secretary Pete Buttigieg said in an interview on Friday that a vehicle miles traveled tax “shows a lot of promise,” a spokesperson for the department countered his comment.

“The Secretary was having a broad conversation about a variety of ways to fund transportation,” Ben Halle, a spokesman for the Department of Transportation, said. “To be clear, he never said that VMT was under consideration by the White House as part of this infrastructure plan—and it is not.”

In a political counter move by Democrats, Postmaster General DeJoy's 10-year plan for the USPS, Rep. Raja Krishnamoorthi, D-Ill., on Friday introduced a bill that seeks to “ensure that the USPS maintains the 2-3 day standard delivery option,” the lawmakers said.

The move came on the same day that the Postal Service filed a notice to its regulatory board seeking to push back the delivery time for priority mail and change the classification of printed materials to competitive products. The Postal Regulatory Commission will review the changes before they are scheduled to take effect, Bloomberg said.

So, we will see. The administration's antivirus efforts and its new economic proposals are still big news items with the capacity to provide relief in the form of new jobs and economic growth — signs that are being watched closely as they appear, 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 and on the News and Analysis Menu of DTN's Professional and Producer products. DTN Top Stories is also on the home page and news home page of online.dtn.com. Subscribers of MyDTN.com should check out the US Ag Policy, US Farm Bill and DTN Ag News sections on their News Homepage.

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