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January 2010 Archive for John Block Reports from Washington

RSS By: John Block, AgWeb.com

John Block has dedicated his professional career to the fields of agriculture, food and health.

Grading The Politicians

Jan 22, 2010

Today, I want to grade some of our political leaders in their effectiveness in serving the ag industry.
 
Start with President Obama. He sets the agenda. I want to give him some consideration. He inherited an economy in free fall. However, from the corn fields of the midwest, from the cotton fields of the south, or the livestock operations across the land, his agenda has focused on big city voters. His agenda has been a push for bigger government, more regulations, and a spending binge that we have never witnessed before. His grade is a C, maybe a D. He has 3 more years to bring it up. I remind you that President Bill Clinton did just that. We shall see.
 
Secretary Vilsack is next. I give the Secretary an incomplete. I give him the benefit of the doubt because he works for the President and in order to push his agenda, he must get support from the White House. And I don’t think the White House has farmers and rural America very high on their priority list. I remember that when I stepped into the role as Ag Secretary, I asked President Reagan to lift the Carter Grain Embargo. I faced strong opposition from Cap Weinberger, Secretary of Defense, and Al Haig, Secretary of State. It took me three months to get President Reagan to announce the lifting of that grain embargo to the Soviet Union. One thing that slowed the process – the President was shot. There are all kinds of internal forces working for you and against you.
 
Now, we can turn to the Chairman of the Senate Ag Committee, Blanche Lincoln. She is new in the job so I’m not ready to grade her either. What I have heard her say is encouraging. She supports expanded trade with Cuba and rural development. She is in no hurry to pass cap and trade. She is not convinced that farmers are going to get a fair deal out of it.
 
Speaking of a “fair deal” for farmers, House Ag Committee Chairman Collin Peterson gets a solid A. He has been tenacious in battling for the ag industry. He fought to protect our interests when the cap and trade bill was pushed through the House. He said up front that nothing good would come out of the Copenhagen climate meeting. He never accepted the indirect land use argument that grain for biofuels would cause conversion of non-agriculture lands here and abroad.
 
As we look ahead, the Ag Committee Chairs in both the House and Senate will have a tough time simply because the leaders of those bodies, Nancy Pelosi and Harry Reid, are not tuned into rural America. In fact, the Obama Administration and the legislative leaders are dominated by big city politicians. Rural America is not even on their radar screen.
 
That’s my report card. I hope I can give some better grades at the end of 2010.
 
Until next week, I am John Block in Washington.

Competing In A Global Economy

Jan 14, 2010

There is a big liberal push for a cap and trade law in this country that supposedly would reduce the greenhouse gas emissions over time. But, did you know that California already has their own version of cap and trade designed to cut carbon emissions beginning in 2012? The law requires that their carbon foot print be reduced to the level of 1990 by 2020.
 
All of that might sound great in happy times. However, to impose a heavy tax and regulatory burden on California, which has 12 percent unemployment and is already broke, makes no sense at all. And that is what has prompted a ballot initiative in California to repeal the law.
 
Now, here is why all of this activity in California is so significant. California voters are beginning to realize that new taxes and regulations will push businesses to leave. They will be looking for business-friendly states like Texas or Nevada. Also, their well-intended costly effort to cut greenhouse gases will have no global impact unless the world joins their effort. And the world is not going to join their rush to economic suicide.
 
The same logic tells us that if the United States should pass a cap and trade law, our businesses would move to China or India or anywhere to escape government taxes and regulation.
 
We are in a global economy, like it or not, and we have to be competitive or we will see the jobs go to other countries.
 
Over-regulation of animal agriculture can push the pork production and the poultry production offshore. When that happens, we not only lose our livestock farms, we lose the processing plants and jobs. The cost of food goes up with added transportation costs.
 
With every tax that is imposed and every new regulation, we must be ever-mindful of the costs that are incurred. We want to keep our jobs here in the U.S. and the 10% unemployment that we suffer now reminds us of that.
 
Until next week, I am John Block in Washington.
 

Look Ahead To 2010

Jan 07, 2010

I can’t believe it but we are already in 2010. We’ve turned the page. We’ve escaped 2009 – not a very good year. What does 2010 look like?
 
In the nation’s capital, the actions and decisions will be driven by politics. Next fall, we have the mid-term elections with all of the House seats up for election and 1/3 of the Senate. The popularity of the Members of Congress is at an all-time low. They are scared to death. Fear – fear of losing will encourage the candidates to listen to their constituents.
 
Although the Democrats will probably reconcile the healthcare bill and pass it for the President to sign, that will not be easy. They just want to get it done. It has been a heavy load. They are supposed to turn to the cap and trade legislation next. I don’t think they will do it. It is not popular; they have used up all of their political capital.
 
Two years ago, immigration was a very hot issue. President Obama said he wanted a comprehensive immigration bill. I don’t think they will do it this year. It is too controversial. The Members of Congress will not want to vote on anything controversial for fear of alienating a voter.
 
The Congress will likely retroactively extend the death tax this year as it was last year. They failed to get that done in the closing days.
 
Liberals will want to spend more money hoping to stimulate the economy. Conservatives will point to the massive debt that we are piling up and argue that we shouldn’t spend any more. I think the conservatives win this one.
 
From the farm gate, look for pigs, cattle, and chickens to have a good year. It’s about time. Grain prices will be volatile, but I think reasonably strong. The world economy is coming back, and don’t forget – exports drive our market. Look back 30 years and the Soviet Union pushed the U.S. grain prices up. Today, it is China.
 
Petroleum prices are high, and I think they will go higher. That gives the biofuels industry the margin necessary to expand.
 
I am on the farm in Illinois this week – freezing my buns. Where is global warming when we need it?
 
I want to close by saying how proud I am of Wal-Mart. Wal-Mart gave $20,000 to the Illinois 4-H Foundation. Wal-Mart stands up for rural America, not just in Illinois, but across the land. “Save money – live better.”
 
I am John Block down on the farm.
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