Hill Heat

Chuck Grassley (R-IA)

U.S. Senate Well, I think cap-and-trade is pushed back anyway because it’s probably more sweeping in its impact on the economy than even what we’re talking about, health care. But I don’t think, particularly, our committee’s got time to do both. And our committee isn’t the only one involved in cap-and-trade because the Energy and Environment Committees haven’t put out anything yet at this point. So I don’t think we’ll act until they act. But it’s become somewhat controversial, as well. Well, I would say the House bill is very, very controversial. And I can tell you, right now, I wouldn’t vote for the House bill. But the – I got to wait and comment on the Senate bill after the committee in the Senate puts a bill out.

I would like to not look at legislation within the Congress. I’d like to focus my attention on a worldwide agreement. Because if we don’t include China and India, we’re going to export all of our manufacturing. And that’s one reason why I’m against the House bill. Senate bill might not be much better. It might take into consideration the really devastating impact it has on the economy of the Midwest, because we produce much – so much for coal. We might be able to do better than that in the House. But that’s still not going to solve the problem of an unlevel playing field for all of America versus China and India. So a worldwide agreement has two advantages. One, it either brings China and – it either brings China and India in under the same caps we have, so we have a level playing field, so we won’t export our manufacturing, all of it to China. And it also has the benefit of requiring a two-thirds vote in the United States Senate before you can get it passed. So it seems to me that we have a better chance of being fair to America, and if it isn’t fair to America, it takes an extraordinary majority to get it through, and presumably if it’s not fair to America, it’s not going to get through the United States Senate.

What I’ve read about the economics of it, and studying particularly FAPRI – you know, University of Missouri and Iowa State and their economic studies – I have – and there’s other economists as well – say that there’s a little bit of benefit to trading, but it falls so much to timber that it seems to me that it’s not good – it’s not going to be beneficial to farming. And – and consequently, I have real doubts about it. I’m not going to reject everything Senator – or Secretary Vilsack says about it, but what I’ve studied, I have great deal of doubt about it being fair to American agriculture. Not – and the main reason for that is: Not giving us enough credit, going back 20 years, for what we have done already through minimum tillage, or no tillage, to cut down on energy use and putting CO2 into the air.

Well, I’d be foolish if I didn’t give – I’d be foolish if I didn’t give it some consideration because there’s a massive amount of scientists that feel that it does. But there’s also an increasing number of scientists that have doubt about it. And so, not being a scientist, I don’t know exactly where to say only those things that are really quantifiable, and temperature has risen. But the scientific aspect that I still reserving judgment on is the extent to which it’s manmade or natural. And it’s reasonable, considering that there’s at least a natural factor in it, because historically, and you can go to the core drillings in the glaciers to get proof of this, that we’ve had decades and decades, and maybe even centuries of periods of time when there’s been a tremendous rise in temperature, and then a tremendous fall in temperature. And all you’ve got to do is look at the little ice age of the mid-last millennia as an example. And so we’ve got to single out what’s natural and what’s manmade before you can make policy. Now, a lot of members of Congress and most environmentalists are – are absolutely convinced manmade is the – is the factor – chief factor here. But I – I want to, before I vote on it, be more conclusive in my judgment, and I haven’t reached that conclusion at this point. But it’s enough to know that I think that even if it is manmade entirely, and so there’s justification for the legislation, you still have to deal with the reality factors that domestically there’s a very unlevel playing field between California and New York that benefit financially from it, and the Midwest and the Southeast United States that’s going to be hurt; and then the unlevel playing field if you don’t include India and China, an unlevel playing field with the United States versus those countries. And so – so we don’t want to lose all of our manufacturing to China. We’ve already lost a lot. We – it’s better to have an international agreement and include China and India in it.

Mike Johanns (R-NE)

Houston Chronicle Market volatility and higher fuel and fertilizer prices may make cap-and-trade practices a hardship for farmers, said Sen. Mike Johanns, R-Neb., and former U.S. secretary of agriculture. “There are more losers than winners with this in agriculture,” Johanns said.

Farm Policy “If you are in the dairy industry, which is absolutely going broke at the moment, if you’re in the pork industry — and one pork producer recently said to me, he said ‘I’m 30 days from being bankrupt’ — if you’re in the cattle industry that hasn’t made money for two years, this is pretty much a disaster for them, isn’t it?”

Omaha World-Herald Unfortunately, the costs of cap-and-trade are real, while so far the benefits for farmers and ranchers are theoretical. Nebraska producers are realists. And realists sift through rhetoric to focus on facts. I commend the secretary for acknowledging that energy costs would go up and rural America is more likely to feel the pinch. . . . There was no estimate of the impact of increased costs on livestock production. This industry represents 57 percent of ag income in Nebraska and more than 50 percent of ag sales nationwide — apparently hog, cattle and poultry are not “agriculture” by the administration’s definition. There was no state-by-state analysis of the impact of cost increases on agriculture production. Nebraska producers pay costs based on local prices, not national averages. And there was nothing regarding the fruit and vegetable industry, representing 15 percent of ag sales nationwide. So let’s add that up — the USDA’s analysis ignores roughly two-thirds of American agriculture. Yet it unequivocally states that cap-and-trade is good for American agriculture? Furthermore, the USDA has assumed that free allowances would be sufficient to keep fertilizer prices from rising but provides no explanation for how many allowances will be needed. . . . Lastly, the secretary fails to mention perhaps the most critical point: The bill would fail to achieve its purported environmental goal of stopping climate change because agriculture producers and manufacturing in China, India and Brazil would in no way be affected by the bill. Without them, the impact on temperature is negligible, a fact acknowledged by the Environmental Protection Agency. . . . So what are we left with? A bill that would place additional tax burdens on American businesses during a severe recession for no discernible environmental gain. A bill that would ask Nebraskans to trust the federal government to provide enough free allowances so the increased energy costs would not put them out of business. Like the secretary, I am supremely confident that American agriculture can adapt. But that’s no justification to support a bad bill. While Americans will face down any challenge facing them, their lawmakers should not be in the business of creating additional ones.

Farm Week Now After health care, Johanns sees climate debate as the next hot button for Congress this fall: “President Obama wants that, and I think it’s going to be one of the next issue queued up, But the feeling in farm country is quite different – he argues Nebraska farmers are “enormously skeptical, if not downright opposed” to proposed greenhouse emissions caps projected to impact future electrical, fuel, and input costs. “You’ll pay more for fertilizer and diesel fuel and electricity to run your irrigation pump,” Johanns warned during an RFD Radio/FarmWeek interview Monday. “On the other side, I think the benefits are very, very uncertain. I think this idea that farmers are going to make money by trading credits is very uncertain promise. “If I were a farmer out there, I’d want the certainty of what I’m doing now, and even at that, that can be very uncertain. Add cap-and-trade to it and what you add is higher input costs with no promise of what comes out on the other end.” In charting marketable ag carbon “offsets,” the House plan does not consider conservation tillage and other “past good practices” that can reduce or trap carbon emissions, and Johanns believes that likely will be “a point of contention” in the Senate. Given the “free” emissions allowances the House proposes to allocate to various sectors in exchange for their support of the plan, he questions how a demand-driven ag credit market could “get up-and-running.” At the same time, he noted “the rest of the world just isn’t where we’re at” in terms of proposed climate policy, and new regulations could put U.S. producers at a serious competitive disadvantage. Some lawmakers have supported an “off-ramp” provision (“It is gaining some ground), but he fears that if the Environmental Protection Agency or other bureaucratic interests were responsible for administering the provision, “we might never get on the off-ramp.”

Blanche Lincoln (D-AR)

E&E News “Without a doubt there are opportunities for us to be able to make recommendations in terms of where we hope that the climate change bill or cap-and-trade bill that EPW is working on is going to go,” Lincoln told reporters in a conference call yesterday.

Reuters “All I’m saying is I think it (passage of a climate bill) is a heavy lift for the Senate” in a session filled with major legislation, she said. Climate change legislation “presents some issues for the farm community,” said Lincoln.

Wonk Room “Making sure as we do move forward, that we don’t do so putting a disproportionate burden on our hardworking farm families and our agriculture communities across this country. They do a tremendous job providing food and fiber for the world. While it isn’t necessarily my preference to move on cap-and-trade legislation in the Senate this year, the Senate is going to move on climate change legislation in the future.”

Reuters “In this economy, it is important to take it one step at a time,” she said as she praised the pending energy bill.

Ben Nelson (D-NE)

Reuters “We have enough on our plate at the moment (with the fight over healthcare reform). It’s questionable to open another front.” Instead, Nelson said the energy bill could be passed as a stand-alone bill, calling it “far less controversial” and “necessary.”

Jay Rockefeller (D-WV)

E&E News Climate change is individuals,” Commerce Chairman Jay Rockefeller (D-W.Va.) said yesterday. “It’s not so much committees and what your position is on committees.”