Farm Policy: AALA Panel Discusses Farming’s Future Under the 117th Congress and Biden Administration
The American Agricultural Law Association (AALA) recently hosted an online panel discussion on what lies ahead for farmers and forest owners as members of the new 117th Congress and President Joseph Biden’s Administration start their work after January 20. The panelists – three public affairs specialists with long agricultural policy experience in Washington, DC – expressed their views on the challenges and opportunities for farmers under the new – but slim – Democratic majority in both chambers of Congress, as well as Democratic control of the federal bureaucracy. The following is a summary of the panel’s views on how this shift will impact specific policy issues such as immigration, climate change and water regulation, and attention to rural issues generally.
A Shift in Balance of Power
Regarding the balance of power generally, Mr. David Crow of D.C. Legislative and Regulatory Services reviewed the results of the 2020 election, noting that President-elect Biden faces an evenly divided Senate (with the January 5 elections of Senators-elect Rev. Raphael Warnock and John Ossoff from Georgia), and Vice-President-elect Kamala Harris will provide the Democrat majority vote in that body. In the House, he noted that the GOP pickup of seats was largely at the expense of sitting Democrats, whereas Democrat pickups (13 seats) were generally open seats, the result being a narrowing majority of that enjoyed by Democrats after 2018. As for the “generic vote” across the country, though 50.8% of voters voted Democrat and 47.7% voted GOP, the GOP’s gain in seats was largely due to redistricting by GOP state legislatures in their favor.
Of the “urban-rural” divide further highlighted by the election, Mr. Randy Russell of the Russell Group noted that the election map shows that Biden won only 17% of the counties nationwide, reflecting gains in more heavily populated urban, suburban and exurban areas (more so than President Barack Obama in 2008 and 2012). Rural counties did not generally provide votes for Democrats, with the result that there are more legislators less familiar with those issues most important to rural areas and farmers. This may result in less attentiveness to the needs of rural voters.
The resulting thin margin in the House and even split in the Senate present House Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer with a requirement for building broad bi-partisan coalitions to pass any major legislation. Speaker Pelosi will have a meager 6-vote margin in securing passage of legislation, and as noted above, the Senate will be evenly divided with Vice President Harris – as President of the Senate – the tie-breaking vote. The Senate has only had a 50-50 split three times in U.S. history, and whether Senate majority and minority leadership can work together to create such bi-partisan coalitions remains to be seen.
House Agricultural Leadership
Regarding key agriculture-related committees, both Mr. Crow and Mr. Russell felt the big loss for agriculture will be the “85 years combined agriculture experience” in House and Senate agricultural committee leadership. Departing the committees are Rep. Colin Peterson (MN-7, defeated), Senate Ag Chairman Pat Roberts (KS) and House Ag Minority Leader Rep. Mike Conoway (TX-11) (both retiring), all of whom have steered multiple Farm Bills and experienced several downturns in the farm economy. The new leadership of the House Agriculture Committee will be Rep. David Scott (GA-13) (the first African American to serve in that position), with a background in nutrition and dairy legislation. At present the bulk of Rep. Peterson’s experienced committee staff will remain in their positions which should provide continuity of experience with the current issues in agriculture. The House Ag ranking member Rep. Glenn “GT” Thompson (PA-15) has been very active on conservation and research issues (he is supported by staff with strong backgrounds in natural resource issues). The House Agriculture Committee will stay largely the same, as will the House Appropriations Committee and the House Natural Resource Committee.
As for the future make-up of the House after the 2022 election, the new 2020 U.S. Census will impact on how districts are drawn before that election. Currently, 36 states draw Congressional districts by the political process and the rest by commission. Republicans control 24 of those 36 state legislatures who will be drawing new districts. “If you match those 24 states up with the states that are gaining population – particularly Texas and Florida – you gotta believe Republicans will draw the district lines in their favor,” said Russell. As for the states that are losing population and thus possibly Congressional seats – such as Minnesota, Michigan and Ohio – redistricting may further reduce the number of counties considered “rural” in redrawn districts. Currently there are only 35 districts out of 435 districts that are considered “primarily rural”, and this number is likely to go down further. “That will present a challenge for all of us in the agriculture community to reach a majority of 218 votes [required to pass legislation in the House]” on issues of importance to agriculture and farming.
Senate Agricultural Leadership
Now that the Democrats have effective control, they will control the legislative process (i.e. what legislation moves forward to a vote). As for the Senate Agriculture Leadership, Michigan Senator Debbie Stabenow (“a force to be reckoned with even before the outcome of the Georgia elections” according to Russell) will assume the committee leadership spot. Senator John Bozeman of Arkansas will take Sen. Robert’s senior position and become the ranking committee member; he comes from a strong agricultural state and is close to the cotton, rice and catfish production sectors. Senator Bozeman’s state is also headquarters to Walmart (the largest retail food grocery in the U.S.), as well as Tyson Foods, the nation’s largest poultry processor. Sen. Bozeman is also former co-chair of the Senate Hunger Caucus.
(Generally, with Democrats controlling the House, Senate and White House, there will likely be a new Covid-19 package with local and state economic relief, a focus on vaccine distribution, and additional economic stimulus getting up to $2000 per individual. There will likely be a focus on worker safety under the pandemic as well.)
As for Senate legislative priorities, Mr. Russell believes climate change ranks near top, alongside its top importance to the Biden Administration and House, which should result in major forthcoming legislation related to this issue. Other policy issues that will be moving forward related to agriculture will be child nutrition funding reauthorization, infrastructure funding, changes in taxes, and worker safety in the meat/poultry industry, along with competition issues in that agricultural sector.
Challenges for Farm Bill 2023
One fiscal challenge facing farmers’ interests in the run up to the next Farm Bill will be the “off baseline” expenditures related to trade and the pandemic. With the Market Facilitation Payments (MFP) related to the trade issues with China and Coronavirus Food Assistance Program (CFAP) related to the pandemic, the federal government will have spent $60 billion in 3 years; and 40% of net farm income in 2020 will have come from the government. These payments were not made under normal farm programs, and therefore are not in the Congressional Budget Office (CBO) baseline (“zero, nothing” Russell emphasized). This means that when Congress writes a Farm Bill in 2023, the available baseline will be normal farm program expenditures and not the monies that have been required to keep farms producing during the pandemic and trade war since the last Farm Bill. Russell believes that without a reversal on trade and a rise in commodity prices, maintaining spending at a level to meet farmer needs will be a challenge.
The Administration of President Biden
Phil Karsting, Senior Policy Advisor at Olsson Frank Weeda Terman and Matz, reviewed the future of agricultural issues under the incoming Biden-Harris Administration. The topline issues Karsting noted were: first, the pandemic, which has hit rural hospitals particularly hard; second, infrastructure spending under the Build Back Better proposal, which calls for $2 trillion in spending, much of which will benefit rural areas; third, climate change, which will now be a recognized and legitimate issue throughout the new government (he noted farmers stand to benefit financially from climate change policy in such areas including payments for soil health); and fourth, racial equity: while most people think of this as an urban issue, there is a “nexus with rural and agriculture” and will become a part of agriculture policy in the administration.
Former USDA Secretary Tom Vilsack will be nominated to again serve as Secretary of Agriculture, which has been well received with policy-makers and many stakeholders in the agricultural realm. At the Environmental Protection Agency (EPA) – which bears a strong nexus with agriculture – President-elect Biden has identified Michael Regan from the North Carolina Department of Environmental Quality as his nominee to head the EPA. Mr. Regan’s background, Karsting notes, “has a lived experience different than most former EPA directors,” in that his grandfather was a farmer and he is an avid hunter and fisherman. It would follow that Mr. Regan will bring a beneficial perspective to rural issues.
A great challenge for all agencies moving forward will be in the realm of replenishing their scientific capacity, given there has been a hollowing out of scientific expertise under the Trump administration. This presents a related challenge to interagency communication to develop consensus on structuring “factual scientific debates” to craft and coordinate consistent policy throughout the federal government.
Select Policy Issues
Mr. Russell noted that there will clearly be a change in focus and strategy in the U.S. approach to trade matters, moving away from the previous administration’s preference for bi-lateral agreements. He expects a return of focus on multilateral and regional trade agreements.
Mr. Karstin emphasized President Biden will need to restore relationships with allies who have been shut out of the U.S. decision-making process, which he feels will be a better approach to building a coalition to deal with some of the regional challenges with China (using the Trans Pacific Partnership as an example of that approach). He also expects to see a return to our involvement in the World Trade Organization’s (WTO) appellate body.
Debt and the next Farm Bill
Mr. Russell noted that U.S. annual (2020) debt has reached $3.5 trillion, but that was largely responsive to the coronavirus pandemic spending, and such spending will likely continue without considerable revenue replacement. With the overall deficit at $25 trillion, at some point this will need to be addressed but that debate is probably not appropriate during the pandemic. His concern – as noted earlier – is the impact the MFP and CFAP payments will have on the 2023 Farm Bill, and if that farm policy debate coincides with renewed emphasis and debate on deficit reduction.
Mr. Karstin noted that Majority Leader Mitch McConnell (soon to be Minority Leader) is one of hemp’s biggest advocates given its importance in his state, and that he has a historically warm relationship with his former Senate colleague Present-elect Biden. In his view this relationship may lead to greater bi-partisan effort on various issues including ironing out challenges and inconsistencies in hemp policy.
Mr. Crow added that when Sen. McConnell got the hemp bill passed, he did so with cooperation from Oregon Senator Jeff Merkely, who is close with the police unions and law enforcement, and Sen. Merkely helped the bill navigate their traditional opposition to hemp legalization (given the challenges smokable hemp creates for criminal cannabis enforcement. He felt this was a positive for hemp production policy in the future.
Mr. Russell noted the challenges with labor supply through the H-2A program as well as the need to provide some form of legal certainty to the undocumented millions working “below the radar” who are still critical to agriculture, but that it is probably not a first year initiative. Mr. Crow felt that the U.S. Supreme Court’s decision allowing the Deferred Action for Childhood Arrivals program (known more popularly as DACA) to remain intact reduced its urgency as a policy issue, and without such a high profile and sympathetic program in jeopardy, immigration reform has lost some momentum across the broad electorate. Because immigration remains a politically heavy political load it is unlikely to be tackled early.
Waters of the United States (WOTUS)
Mr. Crow noted that it took the outgoing administration four years to repeal the Waters of the United States rule put in place by President Obama. He feels that, given that the approach taken by Trump’s EPA to rescind and wholly replace the previous rule (retitled the Navigable Waters Rule), the new Biden administration will have to completely redo WOTUS to restore it to the Obama era-rule, which will be a challenge in following the Administrative Procedures Act and the contentiousness of the issue. Though a President Biden will work to undo many of the regulatory changes of the previous four years, Mr. Crow was unsure whether Biden would expend political capital on undoing the Navigable Waters Rule.
Mr. Crow opined that on the first day of his administration, President Biden would begin the process of rejoining the Paris Climate Accord, and under leadership of former-Senator John Kerry as Climate Envoy, climate change will be a top policy issue (“once the pandemic is controlled of course”).
Mr. Russell noted a “sea change” in attitudes toward climate change, and while agriculture and farmers live on the front line of climate change response, they have been generally defensive about embracing climate change as a priority policy issue. Using the analogy that “you cannot hit a 95 MPH fastball standing on your heels,” he felt agricultural leaders – throughout the entire agricultural value chain – will need to step forward and propose incentive policies in a proactive manner in such areas as methane capture and development of carbon capture markets, and begin viewing climate change policy as a revenue opportunity rather than a cost issue. Even without legislation, he suggested – by way of example – that the Biden Administration already possessed the authority to have the Commodity Credit Corporation set a minimum price (or become a purchaser of last resort) for purchasing carbon credits. Mr. Russell also noted a recent change in a House Rule which previously required an off-set for any new legislation containing expenditures; now under a recent change, any legislation related to climate change will not require an offset. “This provides a huge change that will allow incentives for production agriculture and forest owners to get incentive payments and tax credits for climate-related market opportunities and funds to adopt climate friendly practices.”