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March 05, 2009   Email to Friend 

Tracy Taylor Grondine
(202) 406-3642
March 05, 2009

WASHINGTON, D.C. -- Legislation introduced today to prevent a "cow tax" on farmers and ranchers is both "timely and critical," the American Farm Bureau Federation said in a letter to the bill's sponsors, Sens. John Thune (R-SD) and Charles Schumer (D-NY).

Commending the bipartisan effort, the AFBF said it would work with the senators to ensure that the legislation gains broad support. The Thune-Schumer bill would prevent the Environmental Protection Agency from imposing Title V operating permits on U.S. agriculture operations under the Clean Air Act. Those permits automatically result in mandatory fees.

If EPA were to regulate greenhouse gas emissions (GHGs) under the act, as the agency indicated it was considering last year in an Advance Notice of Proposed Rulemaking, AFBF calculated that it could cost farmers and ranchers $175 per dairy cow, $87.50 per beef cow and $21.87 per hog. The fees were arrived at using publicly available government data.

"The concerns farmers raise are real," said AFBF President Bob Stallman. "They are all the more pressing now as the agency is reportedly looking at potentially regulating greenhouse gases under the Clean Air Act."

AFBF brought attention to the potential operating fees last year when EPA's proposed rulemaking was published, along with a statement by the Agriculture Department that it would result in increased regulation of farming operations. The reaction from farmers and ranchers across the country was swift and widespread, leading to the legislators' commitment to work on legislation.

On another issue, Stallman urged bold action on tariffs, saying that global economic downturns and protectionist trade policies do not mix.

Speaking today to an international trade workshop sponsored by the Virginia Tech University Department of Agricultural & Applied Economics and the Virginia Farm Bureau Federation, Stallman said liberalized trade policy is even more important during times of global economic strife.

"My most important take-home message for you today is the message we are emphasizing to President Obama and his administration: Let's not repeat the mistakes of the past," Stallman said.

Stallman, a Texas rice and cattle producer, explained that the dangers of protectionism are highlighted by the disastrous impacts on the U.S. and world economy of the 1930 Smoot-Hawley Tariff Act. Those punitively high U.S. import tariffs against other nations during the Depression led foreign countries to sharply reduce their imports to the United States. The actions, in response to those U.S. trade barriers, both lengthened and deepened the Great Depression, according to Stallman.

"We must take immediate steps to assure global competitiveness and stop the spread of protectionism fueled by the global economic slowdown," Stallman said. "In tough economic times, we cannot turn our back on trade. In fact, we must be more aggressive than ever in seeking markets for our products. It is not time to set up roadblocks."

During the speech, Stallman issued a bold challenge for WTO-member nations to seriously examine the idea of locking in their tariffs at current applied levels, which would deliver a real reduction in global trade barriers and serve as an incentive for global economic activity.

"The initial decision to merely reduce tariffs from a nation's allowable bound rates, rather from the actual duty rates that are applied to goods, has done little but ensure years of wrangling and negotiated exceptions," Stallman said. "That quagmire will result in little trade and virtually no solution to address a now urgent necessity for world economic growth."

Stallman said days of the U.S. "leading the world trade talks by concession" are over. He said it is time for the rest of the world to step up and make real commitments to improving trade.

Stallman called the intransigence and meandering of the Doha Round trade talks a "good-times indulgence" whose party was brought to a crashing end by the global economic spiral.

"Now is the time to confront reality," Stallman said. "Today, trade is contracting around the world as the global economy fails deeper into recession. Baby steps to reduce tariff barriers are of no use when nations are looking to erect new schemes to block market access."

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