Obama’s Top Farmer Crying Wolf on Farm Bill (Again)
AgriNews reports Agriculture Secretary Tom Vilsack said “the U.S. will cease paying a $147 million annual settlement to Brazil that is part of a long-running dispute over cotton subsidies.”
After eight years of challenges and appeals at the World Trade Organization, the U.S. agreed to pay Brazil $147.3 million in damages to keep the South American country from raising tariffs on American goods. Brazil, a cotton powerhouse, was protesting the damaging effects of various U.S. agricultural policies, such as countercyclical payments made to U.S. cotton farmers when the price of cotton drops below a pre-established mark.
So taxpayers subsidize the U.S. cotton industry and, in turn, funnel money to Brazil’s cotton industry. Brilliant!
Anyway, if the settlement payments cease, Vilsack suggests Brazil may retaliate.
Vilsack claims that this tension exists because Congress has not passed a new farm bill:
Vilsack said in an interview from Brazil that he doesn’t have the authority to continue payments when the budget year begins Oct. 1 because Congress hasn’t yet passed a farm bill or a budget. Current farm law expires Sept. 30.
“The only way that can be done is through the passage of a farm bill,” Vilsack said. “We need (Congress) to get down to brass tacks here and get this done.”
Commenting on the Brazilian government, Vilsack stated, “their patience is not limitless and their options are few.”
But Vilsack is crying wolf, and he’s done so before.
In April of 2012, when the farm bill debate was being waged that year, Vilsack expressed concern that the farm bill be properly structured to ameliorate tensions with Brazil. The Arkansas Democrat-Gazette reported (sub req’d):
After eight years of challenges and appeals at the World Trade Organization, the Brazilians got the United States to pay $147.3 million in damages when the international organization found that three types of farm support distorted the international price for cotton.
The offending U.S. programs are countercyclical payments made to farmers when the price of cotton drops below a pre-established mark, marketing loan payments that provide farmers cash and a minimum price on crops they have offered as collateral, and loan guarantees to foreign cotton buyers.
“It is important and relevant for us as we put together the farm bill that we are cognizant that there are a number of countries watching what we do,” (emphasis added) said U.S. Secretary of Agriculture Tom Vilsack.
“If we don’t structure it right, they can have recourse to the WTO. It can end up resulting in retaliatory steps, which can hurt American agriculture.” (emphasis added) As the House and Senate agriculture committees start working on a new bill, they will use as their starting point the deliberations last fall by a budget-cutting Joint Select Committee on Deficit Reduction, the supercommittee, which failed to agree on a broad plan to reduce federal deficits.
Mr. Vilsack ought to be more concerned with the fact that the American people are also watching, and that the farm bill – without serious reforms – harms taxpayers and consumers.
We surpassed the October 1 deadline in 2012 and the farm bill was not extended until the end of the year. Americans were not suffering under Brazil’s severe “retaliatory steps” then, nor will we now. It is simply rhetoric intended to provoke a hasty decision by Congress.
The farm bill needs serious reforms. No amount of crying wolf should persuade Americans otherwise.