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Jim Wiesemeyer PRX August Seminar Agricultural and Environmental Deficit

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Jim Wiesemeyer PRX August Seminar Agricultural and Environmental  Deficit Powered By Docstoc
					Washington Politics & Policy:
 After elections: Now what?
   Jim Wiesemeyer - Senior VP, Informa Economics
   Mega-Trends in Agriculture
Growing world                                             Need for alternative
population                                                energy feedstocks
 Increasing food &                                        Increasing demand for
  energy demand                                             renewable energy and
 Decreasing farmland                                       biofuels
  per capita


Growing wealth                                            Weather Impacts
 Increasing meat                                         Yield losses through
  consumption and                                          adverse weather
  need for feed                                            conditions
 Decreasing stocks to use                                Russia, Ukraine
                                                           unreliable exporters

  Food and feed crops as well as renewable raw materials and fiber plants
  are competing for limited arable land
     Agriculture Outlook or Lookout
                  ……..
• More volatility: USDA crop estimates, index
funds, acreage battle in 2011
• Financials: Currencies; U.S./world economy
• Food price increases ahead: World Bank, IMF,
FAO concerned; Policy changes?
• Risk management: Rice industry policy changes
• Rice: Loss of key lawmakers
Elections: Angry Americans
Post-election: Which way for Obama?
Positioning for 2012
      Obama and Election Impacts
• Obama administration:
  * More Cabinet, White House changes?

• Gridlock: GOP will halt Obama agenda
  * Jockeying for 2012: Sharpening differences

• Congress: Fewer moderates
• Oversight/Investigations
    State Elections: Results/Impacts

• Governor races: Net GOP gain of 7
  – GOP holds majority of governorships (29-21)
  – Key wins: Florida, Pa., Ohio, Mich., Wis.
• State legislators: GOP gains of 680-plus
  – GOP net gain of 19 more state legislatures
      Nervous about 2012 Elections
                 ……..
• President Obama: Changed electoral map
• Tea Party: Primaries and candidates
• House: Republicans in districts favoring Obama
over McCain: at least 59 in new, 112th Congress
• GOP presidential candidate: Big list
• Jobs: High unemployment ‘new normal’?
                    Lame-duck Session:
                    Stalemate or action?
Session began Nov. 15 – Which issues will be dealt with or punted?
Spending               Another continuing resolution (CR) likely

Deficit reduction      Deficit Commission – Debt limit


2001 & 2003 tax cuts   One- or two-year extension for all; Payroll tax cut

Tax extenders          Biodiesel – Ethanol – R&D

Immigration            No final action, but Senate will try

Other issues           Estate tax – AMT – Unemployment benefits –
                       Food safety/Child nutrition funding

Obama offered compromise with GOP. Big issue ahead: deficit reduction.
                 The New House
GOP controls: Net gain of 63 seats
  – Leaders: GOP: Boehner – Cantor
     • Dems: Pelosi
  – “New” approach in House:
     • Committee chairs: More power
        – Regular markup sessions; floor amendments
     • House will go first on most issues
      New House Committee Leaders
• Key House Committee Changes:
  – Ways & Means: Dave Camp (Mich.)
       • Tax issues -- Trade Policy
  –   Appropriations: Hal Rogers (Ky.)
  –   Energy and Commerce: Fred Upton (Mich.)
  –   Budget: Paul Ryan (Wis.)
  –   Agriculture: Frank Lucas (Okla.)
       • 14 Dems seeking reelection lost; No GOP members lost
       • Role of Collin Peterson (D-Minn.)
                 The New Senate

Dems still control: But weakened majority
  – Same leaders: Reid for Dems; McConnell for GOP


Political Math: Senate Seats in 2012 & 2014:
     • 2012: Dems: 23 seats in play vs 10 for GOP
        – 8 Ag panel members up in 2012, only 1 GOP (Lugar)
        – Dems: Conrad, Stabenow, Nelson, Brown, Casey, Klobuchar,
          Gillibrand
     • 2014: Dems: 20; GOP: 13
     New Chair for Senate Ag Panel
• Impact of Sen. Lincoln’s reelection loss:
  – Who will lead Ag panel…
     • Stabenow (Mich.) up for reelection in 2012, but…
        – North-South coalition of 2008 Farm Bill will likely continue
     • Ranking GOP: Chambliss (Ga.)… or Roberts (Kan.)
How to cut deficit: Changes ahead
 The Projected 10-Year Cost of All House Ag Committee
Programs* is 2.15% of All Federal Government Spending #
     Based on CBO March 2010 Baseline: FY 2011-20 Budget Auth.

 Other Fed Gov't.                                                              97.85%



         Nutrition        1.62%



  Crop Insurance      0.19%



    Conservation      0.15%



      Commodity       0.15%



         Other Ag     0.04%


                     0%     10%   20%   30%   40%    50%    60%   70%    80%    90%     100%

* Ag Committee BA is entirely Mandatory BA and is a HAC Calculation based on CBO March,18
2010 Estimates. # All Federal Govt. Spending includes both Discretionary and Mandatory BA.
        The House Ag Committee’s $924 Billion Projected
          10-Year Budget: Percent of Total by Program.
  HAC Rackup of CBO March 2010 Baseline: FY 2011-20 Budget Auth.

   NUTRITION, TOTAL                                                            75.3%

 Food Stamps (SNAP)                                                            73.9%

   Sec. 32 Food Purch    1.4%

 COMMODITY, TOTAL               6.9%

Commodity: Direct Pay          5.3%

    Commodity: ACRE

Commodity: CCP+MLB       0.8%

    Commodity: Other     0.5%

    CROP INSURANCE                  9.0%

      CONSERVATION              7.0%

          OTHER HAC          1.7%

                        0%     10%         20%   30%   40%   50%   60%   70%    80%    90%   100%
                                                                                             19
              Next Farm Bill
                    ……..
• Issues: Timing; No additional funding
• Repeating 2008 Farm Bill difficult: 37 programs,
totaling $9-$10 billion, have no baseline…
• Budget cuts: Eventual cuts in farm programs
             Next Farm Bill
                    ……..
• Dems want further reforms: Direct payments
• Regional farm policy? Cotton, rice different?
• Rice: Better safety net needed
• Impact of Brazil cotton case: More challenges?
             Issues Delayed
                    ……..
• Climate change: No cap and trade; EPA to
continue regulatory route; Court action/Delay?
• Immigration reform: Not until after 2012
• Trade policy: Finally, some movement

				
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posted:12/30/2010
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