Washington Insider-- Thursday

The Budget Fight

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

Senate Ag Panel Resets Vote On USDA Nominee Perdue to Thursday

The Senate Agriculture Committee will now hold a vote Thursday March 30 to forward the nomination of former Georgia Governor Sonny Perdue to be the next USDA Secretary.

A notice from Senate Ag Committee Chairman Pat Roberts, R-Kan., said the vote would now take place March 30 after the first floor vote in the Senate. The lawmakers plan to meet on the sidelines of the Senate to make their call on Perdue.

The vote had been scheduled to take place Wednesday, but Roberts' office had signaled that would be dictated by the Senate schedule.

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Notice for NAFTA Talks Planned for Week of April 3

The Trump administration hopes to notify Congress the week of April 3 of its intention to launch trade negotiations with Canada and Mexico, Democratic lawmakers said following a meeting with senior officials.

Commerce Secretary Wilbur Ross told members of the House Ways and Means Committee that work on the notice to renegotiate and update the 1994 North American Free Trade Agreement (NAFTA) is on track and could be sent to Capitol Hill before the spring congressional recess, Rep. Sander Levin, D-Mich., said. Congress will adjourn from April 10 through April 21, going out of session April 7.

The 90-day notice, required under Trade Promotion Authority (TPA/fast-track), would pave the way for talks to begin as early as July.

The Mexican government would like to conclude the talks in 2017, Ross said during the closed-door meeting in the Ways and Means hearing room, adding that he would not hold up the negotiations. But Rep. Bill Pascrell, D., N.J., ranking member of the Subcommittee on Trade, said this timeline was not realistic.

The Trump administration wants a "seamless transition" between the exiting NAFTA agreement and a modernized version, Ways and Means Committee Chairman Kevin Brady, R-Texas, said. He added that the administration is seeking to increase market access for U.S. agriculture, manufacturing and services.

Ross, acting U.S. Trade Representative Stephen Vaughn and deputy general counsel Maria Pagan listened to lawmakers' concerns. But they offered few specifics in return on White House negotiating objectives or how they plan to address issues ranging from agricultural market access to labor standards.

Ross told the committee that the Trump administration still has yet to decide what structure the deal will take, said Rep. Kristi Noem, R-S.D. "He hasn't necessarily decided whether it will be a bilateral or a trilateral agreement," said Noem, a member of the Subcommittee on Trade.

On agriculture, some farm state lawmakers are worried about any rise in tensions with either Mexico or Canada during negotiations. "They're very good customers of ours today and we want to maintain that relationship, so in these negotiations we don't want to lose any market access," Noem said. When she raised the issue with Ross, she added, "He said he agreed with me, so I took it."


Washington Insider: The Budget Fight

Last week, everyone was focused on the health care fight and its potential implications. This week, it is the budget, Bloomberg says, and the prospects of avoiding a government shutdown by passing an omnibus spending bill.

A key feature of such talk concerns the President's chances of getting $33 billion in extra money this fiscal year which he wants for Defense and building a border wall—and Bloomberg says those prospects "just got more remote."

Bloomberg cites Roy Blunt, R-Mo., chair of the Senate Labor-HHS-Education Appropriations Subcommittee who said. "My guess is that comes together better without the supplemental."

The lawmakers are up against an April 28 deadline to prevent the government from running out of money and the supplemental request contains a controversial call to cut $18 billion from domestic accounts this year.

Blunt's approach likely would boost the omnibus's prospects in the Senate, where Democrats' votes will be needed to advance the legislation—and who oppose border wall funding as well as a raft of proposed domestic spending cuts. Smoother sailing in the Senate could lessen the chances of a government shutdown, though House Republicans would be expected to press Speaker Paul Ryan to add the border wall and Defense money at some point in the process.

House Labor-HHS-Education Appropriations Subcommittee Chairman Tom Cole, R., Okla., said Blunt has the right strategy. "Roy Blunt is as smart a legislative strategist as we've got," the Oklahoma Republican said. "I'm with him." Senate Labor-HHS ranking Democrat Patty Murray of Washington also offered praise.

"Democrats and now even many Republicans agree: President Trump's latest anti-worker and anti-middle class budget demands would drive us into a completely unnecessary crisis and should be rejected," Murray said. She called for Republicans to stand with Democrats and oppose "poison-pill riders" such as a defunding of Planned Parenthood or ObamaCare.

Rep. Rosa DeLauro of Connecticut, the ranking Democrat on the House Labor-HHS-Education subcommittee, said she was encouraged by Blunt's comments because excluding the supplemental funding request would make passage much easier. After Tuesday evening's negotiating session with Republicans, however, she said she has yet to see a new offer from them on Labor-HHS policy riders.

She also said she is worried that conservatives could prod Ryan to attach the border wall funding through a floor amendment once the planned omnibus is sent from the Senate in the coming weeks. The current plan is for senators to attach the remaining 10 bills, which have not passed the House to the fiscal 2017 Defense spending bill, which is awaiting Senate action after having passed the House.

House Homeland Security Appropriations Chairman John Carter, R-Texas, so far isn't going along with his fellow appropriators. He said he wants to see the supplemental hitch a ride on the omnibus. "I want them done together," said Carter, whose central Texas district includes part of the sprawling Fort Hood military base.

At the same time, the House Freedom Caucus is beginning to discuss strategy on the appropriations supplemental, a House Republican aide said. Members of the group seem pretty united behind including border wall funding, the aide said. One solution could be resorting to using the overseas contingency operations account to increase Defense funds without making cuts, a move that White House budget director Mick Mulvaney calls a "gimmick."

House Armed Services Committee Chairman Mac Thornberry, R-Texas, said he's talking to House appropriators about tackling the Trump supplemental request without the controversial offsets. Thornberry wants the supplemental to draw from uncapped war funds and for it to permit spending in fiscal 2018.

Clearly, there are a lot of moving parts involved in this year's budget fight, but there is clear Congressional pushback to "superfunding" Defense at the expense of domestic programs and a very substantial feeling that appropriators want to avoid a government shutdown. In some ways, this budget fight is every bit as bitter as the health care showdown was, with many of the old combatants and some new ones—including very powerful appropriators who seem leery of getting too involved in the fight over the Southern Wall, which even advocates seem to be concluding is a more complicated effort than formerly assumed.

So, we will see. The line-up of participants with clear points of view is lengthy, and the stakes are high, for agriculture as well as others, and the battle should be watched closely by producers as it proceeds, 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.

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