Don't be fooled.... April 1st Ag News?

Fake or Real.....   .....you be the judge!



Experts Warn Against Midwest Ethanol Dependence

Two longtime observers of the Midwest issued a stark warning to Congress today about the dangers of America’s growing dependence on renewable fuels from the troubled region, and called for immediate action to boost oil imports from more stable parts of the world such as Iraq, Russia, Libya and Venezuela.

The two experts – Corn Growers CEO Chris Novak and Renewable Fuels Association President & CEO Bob Dinneen – noted longstanding disagreements in the region between rival factions loyal to the Vikings, Packers, Bears, Lions and Colts.  The states have clashed over whether “Duck, Duck, Goose” should be called “Duck, Duck, Gray Duck,” and the long simmering dispute in Wisconsin threatens to divide the state between adherents to the “drinking fountain” faction and the “bubbler” faction.

Given the great national urgency of the situation, the experts have decided to release the full text of their April 1 letter.  The letter is available online and pasted below:

April 1, 2015

Dear Members of Congress:

In recent years, Americans have become increasingly reliant on renewable fuels produced in agricultural states in the Midwest.

Some argue that greater use of renewable fuels like ethanol is a good idea merely because it costs 60-80 cents less per gallon than regular gasoline, offers higher octane and better engine performance, has fewer toxic emissions, and creates hundreds of thousands of American jobs.  Sure, but what about the national security implications?

The fact is, the Midwest is a virtual tinderbox of conflicting allegiances.

The region is deeply divided, with factions loyal to the Packers, Bears, Vikings, Lions and Colts frequently at odds with one another. (Some analysts have questioned whether the Vikings are too weak to pose a serious threat to their neighbors, but Teddy Bridgewater had decent numbers last year).

Any resolution to the argument about “Duck, Duck, Goose” has proved elusive, with intransigent Minnesotans continuing to insist upon “Duck, Duck, Gray Duck” – a stance that has isolated the regime against the rest of the country.  Tragically, these disputes often divide members of the same family who have lived for many years in a neighboring state … pitting brother against brother, cousin against cousin, Swede against Swede, at many a family picnic.  Even the individual states themselves are not unified, including the intractable Cardinals vs. Royals divide and decades old disputes in Wisconsin between the dominant “drinking fountain” faction and the smaller but fervent “bubbler” faction.  Then there is the whole “hotdish” vs. “casserole” question.

What would happen if, for example, Minnesota were to invade northern Iowa, seizing key ethanol refineries along the border and demanding the Iowa legislature pass a resolution declaring “Duck, Duck Gray Duck” the official waterfowl game of the Hawkeye State?  The nation might have to learn to do without cleaner, less expensive, less toxic, higher performance fuel.

We are not alone in warning against dependence on renewable fuels such as ethanol.  In fact, oil industry leaders have been sounding the alarm bells for years as these homegrown, renewable fuels have risen to 10% of the nation’s fuel supply.  This, in turn, has contributed to the lowest oil imports in decades – with Exxon Mobil’s profits plummeting to a mere $32.5 billion last year.

Fortunately, there is an alternative to Midwestern renewable fuel – we can simply import more foreign oil from countries such as Iraq, Russia, Libya and Venezuela.  Seriously, what could go wrong?

The most urgent thing Congress could do to curtail our dangerous reliance on renewable fuels would be to repeal or “reform” the Renewable Fuel Standard.  Doing so would result in an immediate increase in foreign oil imports and strengthen champions of democracy such as Vladimir Putin.  As a side benefit, the move would also be a devastating blow to advanced biofuels such as cellulosic ethanol.  Sure, it would drive billions of dollars in investment in these technologies to China and Brazil.  That would be a shame – if all you care about is money and jobs and clean air and lower gasoline prices.  Don’t be so shortsighted.

It’s not too late to choose Mideastern oil over Midwestern ethanol.  The time has come for more foreign oil and less renewable fuel.

Sincerely,
Chris Novak, CEO of the National Corn Growers Association and longtime Midwesterner
Bob Dinneen, President & CEO of the Renewable Fuels Association and Member of the “Bubbler” Clan




White House Plans to Block Grant ARC-PLC to States
Chris Clayton, DTN Ag Policy Editor

A proposal by the Obama Administration expected to be announced Wednesday will dramatically overhaul farm commodity and conservation programs by block-granting those funds to states.

Proposing what could become the biggest reform effort in farm programs since "Freedom to Farm," the White House proposal would put states in charge of deciding which farmers receive price-support programs and set the conditions for who receives farm programs. The program change would go into effect sometime after farmers complete enrollment in Agricultural Risk Coverage and Price Loss Coverage, but may be delayed until after a new farm bill is written after 2018.

Responding to the congressional efforts to convert USDA nutritional programs to state block grants, the Obama administration projected that allowing states to decide how to divvy up federal funds to farmers is a cost-saving measure that the Republican-led Congress would embrace. The USDA proposal is projected to save $80 billion over 10 years.

"In doing some soul-searching, we came to the conclusion that block-granting federal safety-net programs to states offers a clear path to helping reduce federal spending," said Can Cook, an Obama administration spokesman who discussed the issue with DTN only under the condition of anonymity. "Governors and state legislatures in the best position to decide how farm-program dollars should be spent and invested among farmers either as a safety net or to address soil and water conservation issues in their individual states."

Looking to sweeten the pot to states, the ARC-PLC Block Grant Program would offer states incentives to reduce commodity-program payments and grant them authority to divert up to 20% of funds to other state needs. The plan also would allow states to shift farm-program payments to specialty-crop growers. The National Governors' Association stated in a carefully-worded response that it is studying the proposal.

Factoring into the budget savings, the move would allow USDA to eliminate more than 2,000 Farm Service Agency offices nationally as well. "Once farmers complete enrollment in ARC and PLC, we feel confident we'll be able to consolidate FSA work on an individual website that farmers can access."

On paper, the plan would revise the rules for ARC and PLC so states can adjust how much farmers would receive based on factors such as local cash basis and farm income rules. States would be able to lift payment limits and remove arbitrary and capricious procedures such as actively-engaged rules. Yet states would be forced to receive smaller and smaller levels of support each year for commodity and conservation programs and would have to increase add state funds to make up the difference.

Obviously Congress would have an eventual say in the matter, but given the enthusiasm Congress demonstrated last week for block-granting the federal government to states, the administration believes Congress will resoundingly support the program change.

"Looking at the votes, it's pretty clear Congress sees opportunities in delegating as much authority to states as possible as long as they can reduce spending," said Cook, who emphasized that he was speaking only on background.

Savings for commodity and conservation programs would come as states tighten standards on those payments to avoid spending state tax dollars, according to a White House fact sheet.

House and Senate Agriculture Committee leaders leaped to the defense of farmers once word leaked late Tuesday of the administration's block-grant proposal, -- despite their votes last week to block grant SNAP and Medicaid. Other lawmakers rushed to praise the administration for its work to help shore up the federal budget.

“Another attempt by this administration to kill rural America," said a spokesperson for the House Agriculture Committee. "The proposal to block grant the ARC and PLC programs is ill-timed and ill-advised. These programs provide a lifeline for farm families at a time when producers are faced with lower commodity prices,"

Harkening back to the days of the Dust Bowl, the Senate Agriculture Committee called for immediate hearings on why allowing states to decide which farmers should receive federal aid is a wrong-headed move. "With producers experiencing a staggering 43 percent drop in net farm income, allowing states to choose who gets farm-program assistance and who doesn't will put further financial stress on the agriculture industry," said a Senate Ag spokesperson.

At least 10 farm and commodity groups signed a joint letter late Tuesday opposing "the draconian cuts and structural changes" proposed for farm programs. "Farmers will clearly be harmed if the safety-net is weakened in such a manner," said Sloof Lipra, a spokeswoman for the American Farmers Union Bureau.