By Robert Pore
Rep. Adrian Smith, R-Neb., and Sen. Mike Johanns, R-Neb., were critical of recent comment by U.S. Department of Agriculture Secretary Tom Vilsack concerning
Addressing the nation’s farm broadcasters earlier this week, Vilsack said that “…for those who want to defend the status quo, if they think the cost of oil is going to remain static and continue to be low they are just not thinking correctly and that as the world economy begins to pick up the price of oil will skyrocket again.”
“This is an opportunity for us to move away from our addiction of foreign oil, to create new energy sources here in America and create new income opportunities for farmers and ranchers,” Vilsack said. “We should be embracing this. We should not be fearful of this. Fear has never ever moved the United States in the right direction. It has always been our willingness to embrace risk, embrace innovation, embrace change and be an international leader. Now is not the time for us to become fearful, now is the time for America to continue its leadership.”
While Vilsack was addressing the need to pass cap and trade legislation, Smith said Vilsack is wrong in claiming the economic benefits of cap and trade legislation to farmers and ranchers will outweigh added energy costs.
What’s in question is House bill H.R. 2454, the American Clean Energy and Security Act, which was passed in late June. Smith, who voted against the legislation, said the bill will impose new greenhouse gas emissions standards and efficiency standards across the U.S. economy.
“This bill imposes enormous taxes and restrictions on energy use – placing an especially heavy burden on rural America and our nation’s energy producers,” Smith said.
He said that even a small increase in operating costs could devastate farmers and ranchers, “…as Secretary Vilsack well knows.”
“U.S. agriculture producers will also be at a severe economic disadvantage compared to farmers in nations which do not have a cap-and-trade system,” Smith said.
Vilsack is scheduled to hold a “Rural Tour” forum in Scottsbluff in late September to discuss production agriculture.
Smith said agriculture is one of the nation’s most energy intensive industries, and is expected to be impacted heavily by this legislation. Nearly 60 percent of U.S. energy is imported from other countries.
According to a Heritage Foundation economic analysis of H.R. 2454, Smith said farm income would drop $8 billion in 2012, $25 billion in 2024, and more than $50 billion in 2035 – decreases of 28 percent, 60 percent, and 94 percent, respectively.
Smith said U.S. farmers would be at a severe disadvantage compared to farmers in nations which do not have a cap-and-trade system with correspondingly high input costs.
According to Smith, estimates place per household burdens from $1,600 to more than $4,000 annually to comply with the bill. The Heritage Foundation estimates Nebraska will lose more than $1 billion and nearly 10,000 jobs if cap-and-trade becomes law.
To date, more than 100 agriculture groups – including the Nebraska Farm Bureau – have expressed opposition to the legislation, according to Smith.
While cap and trade addresses growing concerns about the levels of greenhouse gases in the atmosphere and the impact those gases could have on the environment, because agriculture is so energy intense, it’s dependent, like the rest of the nation, on imported fossil fuel energy.
According the Renewable Fuels Association, earlier this month the U.S. State Department approved the construction of a new petroleum pipeline with the sole purpose of importing Canadian tar sands oil to the U.S.
According to the Renewable Fuels Association, the environmental footprint of tar sands (carbon emissions aside) is very damaging.
RFA said the State Department justified its decision by saying, “Approval of the permit sends a positive economic signal, in a difficult economic period, about the future reliability and availability of a portion of United States’ energy imports, and in the immediate term, this shovel-ready project will provide construction jobs for workers in the United States.”
Relying on increasingly environmentally unsustainable imports of petroleum is not a long term solution, according to the RFA.
” Yet, the State Department thinks so. So too does the U.S. Environmental Protection Agency which is in the process of creating roadblocks for the development of America’s biofuels industry, a cleaner alternative to tar sands petroleum that creates jobs in the U.S., not Canada,
according to RFA.
RFA goes on to say, “Not only is tar sands petroleum production environmentally damaging, so too is refining this heavier source of crude oil. According to the Chicago Tribune, ‘researchers have calculated that refining the Canadian petroleum produces 15 percent to 40 percent more carbon dioxide emissions than conventional oil.’”
Johanns, in an opt-ed piece for the Omaha World Herald, he said Vilsack’s “rhetoric falls in line with the Administration’s pattern of nice sounding ideas unsupported by facts.”
“Unfortunately, the costs of cap-and-trade are real, while so far the benefits for farmers and ranchers are theoretical,” he said. “Nebraska producers are realists. And realists sift through rhetoric to focus on facts.”
Like with Smith, uses numbers from the Heritage Foundation, Johanns quotes numbers about the negative impact cap and trade would have on agriculture from the American Farm Bureau Foundation.
Johanns said Farm Bureau estimates that 40 million acres will come out of production and another analysis predicts a loss of 78 million acres to trees.
“That’s nearly 20 percent of our nation’s total cropland,” Johanns said. “The Secretary’s argument appears to hedge on one of two options: America’s farmers have the land, time, and resources to increase their acreage by 20 percent; or they can convert 20 percent of current cropland to trees without a significant loss in output and income. Neither option makes sense.”
Johanns said the bill places additional tax burdens on American businesses during a severe recession for no discernible environmental gain.
“Like the Secretary, I am supremely confident that American agriculture can adapt. But that’s no justification to support a bad bill,” he said. “While Americans will face down any challenge facing them, their lawmakers should not be in the business of creating additional ones.”