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How to reform farming

(Friday, March 17, 2006 -- CropChoice news) --

1. How to reform farming
2. Panhandle group wants to develop wind power
3. Local stakes are huge in coal struggle
4. University joins with power district to study energy
5. Senate committee gives agriculture agency 90 days to show progress

1. How to Reform Farming

by Jim French
Published on Tuesday, March 14, 2006 by the Providence Journal

I am a farmer and a rancher, in a line of four generations of farmers and ranchers before me. Each day I consider the variables of weather, soil, money, time and -- not in a little way -- government policies and programs. Like most farms and ranches, mine is built with local, regional and global building blocks.

People in agriculture know that shifting one element can change farming's whole pattern. A hail storm here, a disease outbreak there, an adjustment in policy one year, and a federal deficit the next can each greatly affect success or failure.

For natural calamity, there's not much we can do but be prepared. But with policy, we can all shape the future to avoid disaster.

Unfortunately, we are failing. Consider how farms receive public support. Farmers get subsidies based on how many acres they farm and how many bushels they produce. Since there are no government limits on how many acres a farmer may plant, the American taxpayer funds a system that fuels the engine of commodity overproduction and farm expansion.

More than 78 percent of U.S. production subsidies funnel to 8 percent of the nation's producers. A grossly inflated cap of $360,000 and loopholes allowing multiple payments let many huge operations and absentee owners receive over $1 million apiece in tax dollars each year.

The lion's share of farm payments, originally meant as a safety net for farmers, now goes to those who least need the money.

This system drives big operations to get even bigger. According to the latest agricultural census, since 1978 more than 400,000 farms have gone out of business or been consolidated into larger operations.

And when subsidy-driven surpluses of cotton, rice, wheat and corn flood the world markets, more than small- and medium-sized U.S. farms suffer. Such developing nations as Mali, Mozambique and Senegal have no tax-supported safety nets; their cotton producers on small landholdings cannot compete with subsidized U.S. cotton, which is sold below the cost of production. So families go out of business, move to overcrowded cities, and add to world poverty and hunger.

Ironic, isn't it? The more we produce, the more we contribute to economic inequality, both here and abroad.

What can a lone farmer suggest?

First, any change should be gradual but decisive. Taxpayers should begin by demanding that Congress cap individual farm payments at $250,000 and close loopholes allowing big farming corporations to circumvent the limit. This move already has the support of the Senate Agriculture Committee and President Bush.

In the longer term, Congress should do more to stabilize farm numbers and encourage rural development. This can be done by reinforcing programs that encourage good stewardship, rather than big farms and big surpluses.

One example is the Conservation Security Program. It links farm payments to practices that protect water, air and soil; enhance wildlife habitat; and encourage energy efficiency. As a template for future farm policy, the program could deliver big benefits, yet it is seriously underfunded, and available only in limited areas.

Americans must decide: Do they want to pay tax dollars to fewer and fewer bigger and bigger farmers? Or do they want programs that keep more farmers worldwide on the land, increase opportunities in rural communities, and preserve the world's natural bounty for generations to come?

Jim French is a farmer who works on policy and conservation issues for the Kansas Rural Center. This piece appears in cooperation with the Land Institute's Prairie Writers Circle (Salina, Kans.), from which the column originated.

2. Panhandle group wants to develop wind power

KRVN Radio Ag News, March 13, 2006

SCOTTSBLUFF, Neb. (AP) _ The director of the Panhandle Area Development District says the region needs to do more to develop wind farms.

Jerrod Haberman says the area has a great opportunity for economic development through wind-generated electricity.

The P-A-D-D has formed an action committee to coordinate efforts to promote the region's wind energy potential.

The committee is sending out surveys to energy providers and politicians asking why Nebraska produces less wind energy than its neighboring states and what the state can do to encourage more wind-energy development.

According to the American Wind Energy Association, Nebraska has an annual energy potential of 868 (b) billion kilowatts per hour. Only North Dakota, Texas, Kansas, South Dakota and Montana have greater wind energy potential.

3. Local stakes are huge in coal struggle

(Lincoln Journal Star 3-11-06)

Civilized verbiage used by news media this week obscured the drama unfolding on the high plains of Wyoming.

The power struggle over coal shipments to the Laramie River Station is the 21st century version of the railroad wars of the Old West.

In those days, companies hired gunslingers such as Doc Holliday and Bat Masterson to get their way. These days, they hire lawyers.

If the Burlington Northern Santa Fe wins the showdown, it collects another $1 billion. If the Lincoln Electric System and its partners lose, your electric rates go up.

The local stakes are considerable. Adding to the intrigue is the presence here of hundreds of BNSF employees; they've got feet on both sides of this battle.

In a nutshell, the railroad is trying to impose a huge rate increase for hauling coal to the power plant. Over the next 20 years, the rate increase would amount to $1 billion.

"I've been in the coal business for 30 years, and I have never seen rail rate increases of this magnitude imposed by BNSF," said Duane Richards of Western Fuels.

This week's news focused on the railroad's failure to maintain a stockpile of coal at the plant. Normally, the plant has a 30-day supply. Lately it has shrunk. Now the plant's operators say they have enough on hand to keep running for only three to six days.

Suspicious minds may conclude that the railroad is playing hardball, showing off its power to cause havoc.

From the utilities' point of view, they are captive customers of the BNSF. They can't turn to another shipper to deliver the coal they need. They contend that the BNSF is exploiting a regulatory quirk in order to impose exorbitant rates.

Ron Harper, CEO of the Basin Electric Power Cooperative, which operates the plant, refers to the rate increase as "The Great Plains Robbery."The Minnesota Association of Cooperatives says in a fact sheet that it and other captive shippers are being "railroaded!"

LES and its partners are fighting back in a number of ways. They've filed a complaint with the U.S. Surface Transportation Board. LES CEO Terry Bundy said preparing the case literally amounts to figuring out how to operate a stand-alone railroad, because theoretically the BNSF could charge no more than that hypothetical entity.

Efforts also are underway in Congress to combat the railroad's monopolistic practices.

As LES ratepayers tear open their bills to see how the recent rate hike will deflate their wallets this month, they might observe that in some ways not much has changed from the days of the railroad wars.

These days, people carry briefcases instead of Colt revolvers. But when the stakes are high, the tactics are still ruthless.

4. University joins with power district to study energy

The Associated Press
Lincoln Journal Star, March 11, 2006

A center focused on developing new sources of energy will be developed at the University of Nebraska-Lincoln thanks to a $5 million donation from the Nebraska Public Power District.

The money, spread out over five years, will be combined with $400,000 annually from the university to fund research and to leverage against even larger grants from the federal government and others.

The NPPD board of directors on Friday approved the agreement to donate the money for creation of the Nebraska Center for Energy Sciences Research.

"Energy is so important to our economy and such a big driver that we need to find better ways to be more efficient in the production of energy and the consumption or use of energy," said Ron Asche, president of NPDD.

UNL Chancellor Harvey Perlman, in an e-mail sent to faculty and staff, said work is already under way examining biofuels, hydrogen technology, and other energy sources as alternatives to fossil fuels.

The new center provides a way to bring together all those in different disciplines throughout the university already working on energy issues, said Prem Paul, UNL's vice chancellor for research.

The new center will help the university engage in national initiatives to find fuel alternatives, Perlman said.

"This is a critical area for us, not only because of its importance to the nation, but also because of Nebraska's strategic position, particularly with biofuels and wind-energy," Perlman said in the e-mail.

The agreement will be presented to the university's Board of Regents for approval in April.

5. Senate committee gives agriculture agency 90 days to show progress

By Catherine Hunter, CQ Staff
March 9, 2006 - 7:13 p.m.

A Senate committee set a 90-day deadline Thursday for the agency that oversees the nation's grain inspection, meatpackers and stockyards to report its progress in correcting lax investigative and oversight behavior, as reported by the Agriculture Department's inspector general.

"This thing has been going on too long, and we're not getting the response we need," said Saxby Chambliss, R-Ga., chairman of the Senate Agriculture Committee, at a hearing with Agriculture officials. "In fact, we're not getting any response at all."

Chambliss gave the head of the Grain Inspection, Packers and Stockyards Administration 90 days to report on the agency's progress in implementing the inspector general's recommendations.

Chambliss said he did not expect the agency to execute all the recommendations within 90 days, but "we're going to stick with them until they do implement all of them."

"It is totally unacceptable for our federal government to behave this way," Chambliss said. "It greatly threatens the confidence livestock market participants extend to the federal government."

A January report by Inspector General Phyllis K. Fong found that the Grain Inspection, Packers and Stockyards Administration essentially blocked investigations of anti-competitive behavior and failed to establish adequate controls for enforcing the Packers and Stockyards Act. The 1921 law is aimed at protecting livestock and poultry producers from fraud, abuse and anti-competitive behavior.

"What we found, at best, could be described as tremendous mismanagement," Fong said.

The inspector general's office has cited similar issues in criticizing the agency several times in the past, starting in February 1997. The Government Accountability Office, the investigative agency of Congress, echoed those concerns in September 2000, concluding that the Agriculture agency's investigative processes were poorly designed for complex anti-competitive issues.

Senators said the agency's leaders failed to improve its practices despite promises to do so after each of the critical reports.

The committee's ranking Democrat, Tom Harkin of Iowa, and some Republican senators called for a special counsel to oversee the agency. "How is it possible that [the inspection agency] was in disarray for so many years and no one above the level of deputy administrator took corrective action?" Harkin asked.

Administrator James E. Link said the agency had already begun implementing some of the inspector general's latest suggestions for improvement.

"My first priority now is to correct the inadequacies that were going on," Link said, acknowledging that there had been a "communication disconnect" in the past and that "the left hand didn't know what the right hand was doing."

'Total Incompetence'

At the hearing, Harkin produced a letter he had received in 2003 from Bill Hawks, then-agriculture undersecretary for marketing and regulatory programs, that said the inspection agency was "undertaking a top-to-bottom review" of the Packers and Stockyards Act to ensure that it was still maintaining a "healthy, efficient, fair and competitive market."

Both Inspector General Fong and Administrator Link said they were unaware of any such review. Chambliss said they should find out if the review took place and report back within 30 days.

Based on the inspector general's findings, Harkin and Republicans Craig Thomas and Michael Enzi, both of Wyoming, and Charles E. Grassley of Iowa are calling for legislation to allow the Agriculture Department to establish a special counsel whose sole responsibility would be to investigate and prosecute violations on competition matters.

Criticism has primarily been aimed at JoAnn Waterfield, the agency's former deputy administrator who resigned in light of the inspector general's report. But Harkin questioned whether Mary Hobbie, who oversees the trade practices division in the department's general counsel's office, also was to blame. When Hobbie said she was "surprised" that the agency had only sent two anti-competition cases to her office in a seven-year period, Harkin said she should have talked to her supervisors - including Agriculture Secretary Mike Johanns.

"I want to know how high up this went," he said. "Even putting the best light on it, it was just total incompetence."

Source: CQ Today