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John Block: Farm Bill Conflict

We don’t have a budget yet. We don’t have a farm bill. House Ag Committee Chairman Frank Lucas (R-OK) hopes to have a draft bill by week’s end. Debbie Stabenow (D-MI), Senate Ag Committee Chair, acknowledges there are a lot of differences to be worked out, but she has hope. They are both hoping.

The most difficult gap to bridge is the level of cuts in the food stamp program. The House cuts $40 billion over 10 years. The Senate cuts $4 billion. That is a difference of $36 billion. Not even close.

Then, we have the country of origin labeling battle. This has been going on for years. Canada and other countries challenged our rule that meat be labeled with the country of origin. The World Trade Organization agreed with Canada. Now, USDA is trying to change the wording in hopes it will pass WTO review. Canada says the new requirement is even more objectionable. I think COOL is a really bad rule.

But, here is the problem. We have hogs born and raised in Canada that are shipped into the U.S. for slaughter. We also have hogs born in the U.S., shipped to Canada to be fed to market weight, and then shipped back to the U.S. for slaughter. To comply with the COOL rule, the processor would have to segregate the animals coming in to be slaughtered. Couldn’t mix the U.S. hogs with those from Canada. Processing lines would have to be segregated. This is all a costly waste of money and facilities. Plus, it’s not fair to the Canadian producers that want to sell in the United States.  Country of origin labeling is not “COOL.”

Another sticking point may be the sugar program. Our sugar program is a throw-back to the old days. In the early ’80s, USDA would make loans to producers for grain, dairy products, etc. If the price didn’t rise above that loan rate for the farmer to pay back the loan, the government just took the grain. Of course, that meant USDA was stuck with millions of dollars worth of grain that wasn’t worth the dollars loaned. Today, USDA is sitting on 300,000 tons of sugar, and will lose millions of dollars.

Most of our farm programs have long-since gotten away from this. Sugar should do the same. Let the markets work.

The last issue I will bring up today is Rep. Steve King’s (R-IA) amendment to stop states from passing laws that restrict trade between states. A specific example is California law that will not allow imports of eggs into California unless the laying hens’ cages meet California cage standards. If legislation like that is allowed to stand, different states with different standards can tie our country in knots.

Chicken eggs will be just the beginning. What’s next – pork, beef, or wine?

John Block was Secretary of the U.S. Department of Agriculture from 1981-1985, where he played a key role in the development of the 1985 Farm Bill.

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