Washington Insider-Wednesday
Growing Visibility of Climate Change
Here’s a quick monitor of Washington farm and trade policy issues from DTN’s well-placed observer.
Obama: TPP Approval to be Painful, NoisyRatification of a 12-nation Trans-Pacific Partnership (TPP) trade deal will be "painful" and "noisy," President Barack Obama said this week, but he is confident it will happen, despite high hurdles before and after Nov. 8 results are known.
Obama said the TPP would boost commerce by eliminating 18,000 tariffs on U.S. goods, making them more attractive to some of the world's fastest-growing markets. "Every trade deal is painful because folks are always seeing if they can get an even better deal, especially when you have multiple parties involved," he said at a joint news conference in Hanoi with Vietnamese President Tran Dai Quang. Vietnam also is a member of the TPP.
Challenges with the U.S. Congress will be many and difficult, a far different scenario than Vietnam faces with its parliament, which is expected to ratify the accord by year’s end. "The politics of it will be noisy," Obama said, alluding to domestic resistance to congressional approval of the TPP and to the difficulties lawmakers had in passing the trade pacts with Korea, Colombia and Panama in 2011.
Addressing an issue cited by trade policy opponents, Obama said the TPP would strengthen tools to detect currency manipulation and put offenders on notice. But the tools have limits, the president said, because foreign exchange rates fluctuate for a mix of reasons, not just government abuse.
In what will likely be part of his TPP approval strategy ahead, Obama said he has "not yet seen a credible argument that once we get TPP in place, we're going to be worse off. We are demonstrably better off, American workers and American businesses are better off if we get this deal passed."
Monsanto Rejects Bayer Bid
Monsanto's board of directors rejected the $62 billion offer from Bayer as "incomplete and financially inadequate," according to a statement released by the firm.
While rejecting the offer, a statement from Monsanto said they are "open to continued and constructive conversations to assess whether a transaction in the best interest of Monsanto shareowners can be achieved," but it did signal what transaction would be viewed in the "best interests" of the company.
"We believe in the substantial benefits an integrated strategy could provide to growers and broader society, and we have long respected Bayer’s business," Monsanto Chairman and CEO Hugh Grant said. "However, the current proposal significantly undervalues our company and also does not adequately address or provide reassurance for some of the potential financing and regulatory execution risks related to the acquisition."
Even while signaling it was open to further talks, Monsanto indicated there was "no assurance" that a transaction would be completed, nor what terms that could take. The Monsanto board has not set a timeline on those additional discussions and the firm's release said they do "not intend to make further comment at this time."
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Reuters indicated that sources signaled Monsanto has confidence its standalone plan even as it can see industrial logic in a linkage with Bayer.
As for antitrust and regulatory concerns, Reuters indicated that Monsanto believes the plan would gain the needed approvals.
Washington Insider: Growing Visibility of Climate Change
Bloomberg is reporting that the pace of global environmental damage is intensifying, especially in some of the poorest parts of the world. The details came from Achim Steiner, the outgoing executive director of the United Nations Environment Program, who discussed his group's new UN report.
"If the current trends continue and the world fails to enact solutions that would improve the current patterns of production and consumption, then the state of the world's environment will continue to decline," Steiner told more than 2,000 delegates at the second session of the United Nations Environment Assembly in Nairobi, Kenya.
"High on the culprit list are some surprising villians ... exposure to harmful chemicals, limited access to clean water, poor waste management and climate change," Steiner told environment ministers and others from 198 countries.
Citing World Health Organization statistics, Edgar Gutierrez, president of UNEA-2, said 12.6 million deaths globally in 2012 were due to deteriorating environmental conditions.
And UNEP chief scientist, Jacqueline McGlade, said a UNEP report being released at the conference predicted more problems ahead.
"Estimates from the WHO indicate that 250,000 additional deaths could occur each year between 2030–2050, mostly from malaria, diarrhea and heat stress, as a result of climate change," said McGlade.
While the reports estimates numbers of deaths attributable to the environment, "These estimates, however, do not take into account the effects of emerging global environmental changes... which risk reversing decades of progress in health and development through the combined effects of climate change, biodiversity loss and the degradation of the natural systems that support all life."
Walker Smith, director of the Office of Global Affairs and Policy at the U.S. Environmental Protection Agency, said widespread land and coastal degradation greatly exacerbates the effects of extreme weather, destroys livelihoods and food security.
Most conference delegates were concerned that inaction to global degradation of ecosystems will continue to increase health-related consequences. According to Khaled Fahmy, Egyptian minister for environmental affairs, environmental degradation has been a major driver for forcing people into migration or internal displacement, especially in Africa.
Communities dependent on degraded landscapes, such as overgrazed, heavily deforested, drought prone and severely eroded lands, are exposed to famine and loss of shelter and are vulnerable to slow-onset disasters, according to Fahmy.
"In this regard, the poor can in Africa and elsewhere in developing countries get trapped in a chronic pattern of poor well-being associated with living in degraded environments, and too often are forced to migrate to rapidly urbanized areas or refugee camps," he said.
According to the Office of the United Nations High Commissioner for Refugees, there were 56 million refugees and internally displaced people globally at the end of 2014.
And, then there are the political "gotchas" that inevitably crowd out some of the more serious news. Presumptive Republican presidential nominee Donald Trump has regularly belittled any idea that the climate is changing, but press reports are highlighting his efforts to build a sea wall at one of his golf courses in Ireland to protect it from global warming, according to his permit application filed by International Golf Links Ireland. "Global warming and its effects" are cited as the reason why protection from erosion is needed at the course in County Clare.
According to the report, the course suffered major damage in a storm just days before Trump purchased it, with parts of it suffering nearly 30 feet of erosion.
Trump International Golf Links Ireland also submitted an environmental impact statement accompanying the application that cited a study predicting a steady rate of erosion, but argued that the study underestimated the effects of climate change.
"If the predictions of an increase in sea level rise as a result of global warming prove correct, however, it is likely that there will be a corresponding increase in coastal erosion rates not just in Doughmore Bay but around much of the coastline of Ireland," the statement reads. "In our view, it could reasonably be expected that the rate of sea level rise might become twice of that presently occurring. ... As a result, we would expect the rate of dune recession to increase."
Trump has called climate change a hoax, claiming that China created the myth in order to surpass the U.S. economically.
For the last several years, the United States has been quite active in organizing and implementing greenhouse gas controls both at home and overseas. Now, the policy agendas of the two parties are very, very different, so it remains to be seen how those difference are resolved, Washington Insider believes.
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