Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.Chamber of Commerce Lobbies for Immigration Reform
The U.S. Chamber of Commerce has joined in lobbying Congress to overhaul the country's immigration system, saying that doing so would benefit both national security and economic growth.
In a report issued earlier this week, the chamber calls for: securing the borders and developing ways to prevent foreign nationals from overstaying their visas; modernizing the legal immigration system by increasing employment-based temporary and permanent visa caps, creating a new visa program for low-skilled, year-round workers and overhauling the agricultural worker program; mandating E-Verify under certain conditions; and creating a process for the legalization of the 11 million undocumented immigrants currently in the country.
National political leaders have said for more than a decade that immigration reform should be among the nation's top priorities. Two years ago, the Senate approved (68-32) a bipartisan bill that at the time was called by some "the most monumental overhaul of U.S. immigration laws in a generation." It would have cleared the way for millions of undocumented residents to have a chance at citizenship, attracted workers from all over the world and devoted unprecedented resources for security along the U.S.-Mexico border.
The chamber and others who support immigration reform are optimistic that Congress will take a closer look at reform proposals and begin to address a problem that has grown and gone unresolved for years.
***Highway Reauthorization Bill Still has a Long Way to Travel
The Senate yesterday approved a long-term (six-years) highway reauthorization bill, followed by a vote on the shorter-term (three-months) that the House approved Wednesday before bolting from Washington to begin its five-week summer recess a couple of days early. The House version would continue transportation funding through Oct. 29 by transferring about $8 billion to the Highway Trust Fund.
The hope of the Senate Environment and Public Works Committee leaders is that their counterparts in the House will meet over the summer recess and use the Senate's version as a model for their own. If that process works, it would allow a House vote on transportation reauthorization soon after members return in September, and a House-Senate conference on the measure shortly thereafter.
The White House has said that the president would sign the three-month highway funding bill, adding, however, that the administration would have preferred a long-term solution. "The unfortunate reality is that, due to inaction, Congress will need to pass this other short-term extension to keep federal funding for the surface transportation system flowing," said White House spokesman Eric Schultz.
Members of Congress in both chambers and both political parties are in general agreement on the need to pass a multi-year highway spending bill. Whether the accompanying details regarding a source of funding and other critical matters can be agreed and resolved remains an open question.
***Washington Insider: Congress Lets Export-Import Bank Die, for Now
While details regarding the Export-Import Bank's fight for reauthorization are almost impenetrable, they include a number of important symbols. The bank's federal authorization expired July 1, to the cheers of conservative lawmakers who call it a tool for crony capitalism. At the same time, for many of the businesses that rely on its loans and other services, both small and large, the lack of congressional action seems to mean pulling them back from important highly competitive export markets.
The bank makes and guarantees loans to companies regardless of size. For example, airplane giant Boeing says the program's end will hurt it and the United States. It also says that it may move part of its business overseas, reversing past efforts to keep manufacturing jobs in the United States.
So, what is the fight really about? Probably not about money, experts suggest. It charges fees for its services and claims to make money for taxpayers, although budget hawks often dispute such claims. Nor does it seem to be largely about the structure of the support it offers –– including loans and guarantees for infrastructure to foreign countries –– although some of those loans have been unpopular. And, loans for U.S. aircraft, for example, sometimes go to airlines that compete with big U.S. operations, a fact that does not make many friends for the bank in the United States.
Still, it supports numerous small businesses what face tough competition, especially from similar operations supported by foreign governments. These enterprises argue that they will have considerable trouble surviving without Ex-Im, an argument that seems to resonate across the urban press.
For example, the daily publication Politico is reporting that competing export credit agencies overseas are moving quickly to take advantage of Ex-Im's demise to lure away business from U.S. companies. "They're gleeful about it, and I don't blame them," one export credit executive said. "Those foreign competitors are going to customers in other countries and saying, 'Hey, you don't know if your U.S. supplier is even going to be able to ship to you and give you the payment terms they're promising in their quote, because look what's happening with Ex-Im Bank.'"
However, much of the criticism seems to focus on the fact that the bank is a government financed operation and that the market could do the same thing cheaper and better, which also is a disputed assertion. Still, Rep. Jim Jordan, R-Ohio, a leading conservative critic of the bank, says "Every day that goes by without the Ex-Im Bank being resurrected means it is more likely that it permanently ends.… This is the kind of example of good governance that I am excited to tell my constituents about during the August recess."
Critics like Jordan argue that Ex-Im doesn't create jobs, it merely shifts jobs to export-related sectors. They also emphasize that the private sector could step in to fill any void created by the bank's death. However, many smaller businesses counter that Ex-Im's services are critical to their business's ability to provide products to numerous "hard sell" customers overseas.
For smaller companies focused on North Africa, for example, one executive told the press, "In any given year, our projects there represent 30 to 50 percent of their yearly sales." He said his support from Ex-Im is locked in for roughly the next year, "but if the agency stays dead, it could lose 30 to 40 percent of its sales "right off the bat."
"We don't have any alternative in the private sector to bring them to," said another executive whose company provides export credit insurance for around 1,000 companies, of which 550 have insurance policies through Ex-Im. "It doesn't exist."
Still, Heritage Action emphasizes in its publications that only a tiny share of small-business exporters used the agency's services in 2012.
So, it is hard to tell if the Ex-Im fight has really been won by conservatives, and whether that could spill over onto other industry support programs, including agriculture. Some of these, including, for example, the old sugar program, have significant costs these days and may actually be facing threats as the Trans-Pacific Partnership negotiations proceed and other sectors find the need for the United States to grant some concessions on agriculture to gain a little for autos, or big pharma or another subsector.
Or, not. U.S. Trade Representative Michael Froman says he won't negotiate away U.S. ag support programs, so maybe that threat is not real in spite of pressure from Australia and others.
Still, the current attack on business support programs — even those with little budget impact — should be watched closely for unexpected turns as the trade talks proceed and the elections loom, Washington Insider believes.
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