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Dittmer: The state of affairs in the United States

Free Market Reflections with Steve Dittmer

Though there may be Supreme Court cases still pending when you read this, it’s looking like Joe Biden will be our next president.

The foundation of our constitutional republic is our ability as citizens to direct our government through representatives we elect. With tens of millions of citizens lacking confidence in the outcome of a presidential election, it certainly clouds attitudes.

No matter who is president, control of the Senate will be critical. Trump’s approach has been pro-business, anti-regulation, pro-fossil fuel energy, pro-agriculture and pro-trade.

Under Biden, the Senate would be the last obstacle to the left’s goals of packing the courts, raising taxes, resuming overreaching regulation, implementing the so-called Green New Deal energy agenda discouraging fossil fuel use and adopting big government “solutions.” The left is skeptical of the free market economic system, but expects it to produce the tax revenue it needs for redistribution while continually destroying incentives for economic activity.

Regardless of the election outcome, Trump has left several lasting accomplishments. There are roughly 300 federal justices and the three U.S. Supreme Court justices, all of whom are much more likely to adhere to the constitution as written.

For the beef industry, just the trade agreement with Japan was monumental. A long-lasting agreement that drastically reduces huge tariffs over time with our top export customer is huge. South Korea is breathing down Japan’s neck for the top slot and Trump solidified a relationship with another great customer. Regardless of whether political and COVID-19-related difficulties keep China from purchasing everything they agreed to in the phase one deal, Trump got us in the door with fewer restrictions than thought possible. The Chinese are becoming familiar with grain-fed beef and are buying more — progress. There are only two major sources of high-quality, grain-fed beef and both countries will be working hard to develop that market.

Without Trump’s carrot-and-stick negotiating push, I’m not sure how negotiations with the U.K. will go. Their negotiations with the EU have not gone well and are past the supposed deadline. Britain is looking at tariffs, onerous restrictions and extremely long truck lines at checkpoints without a trade agreement.

Trump also showed more respect for agriculture and packers than recent presidents. We’ve had a USDA secretary that respected the mainstream industry.

The latest news is that Biden is going to bring back Tom Vilsack as secretary. Colin Woodall at NCBA said they had been able to work with Vilsack and expected to continue that.

The Senate runoff elections for two Georgia senators are crucial. If Trump’s veto is not there to stop government expansion, higher taxes, more federal regulations and more extensive climate change measures, the Senate will be the only obstacle. A Democrat administration will be more open to “reforming” American agriculture, especially moves like breaking up all sector major players, taking away technological tools and reshaping economic structures to be more “just” and more “healthy.”

Rep. Collin Peterson (D-Minn.) has been chairman of the House Agriculture Committee off and on for years and in Congress for 30 years. He lost his bid for re-election.

U.S. Representative David Scott of Georgia will be the next chairman of the House Agriculture Committee. Scott has been chair of the agriculture committee’s dairy subcommittee and the subcommittee on commodity markets and credit.

On being selected, he mentioned pushing the “values” of the Democrat caucus and listed “priorities for trade, disaster aid, climate change, sustainable agriculture, SNAP, crop insurance, small family farms, specialty crops and rural broadband. The fault lines dividing our rural and urban communities are running deep, and climate change is now threatening our nation’s food supply.”

Woodall is “excited and thrilled” to work with Scott, as Scott has supported NCBA’s positions on COOL, the GIPSA rule and the death tax.

The Senate Ag Committee leadership was already slated for change, with Sen. Pat Roberts (R-Kan.) retiring. The chairman now is Sen. John Boozman, (R-Ariz.), who is familiar with cattle issues and on the nutrition subcommittee.

There’s been only a little news about implementing the framework for boosting cash negotiated cattle sales January 1, 2021. The effort to get the major packers to discuss and commit to the framework is still complicated by lawsuits pending against the packers. The taskforce is also dealing with confidentiality issues with AMS reporting.

The difference between cash prices and formula cattle this fall was $25-$40/hd. That is a big price hickey to shoulder voluntarily. If one is a custom feeder, how are you and your customers going to decide who takes the hit this week?

About the author

Contributor

Steve Dittmer is the CEO of Agribusiness Freedom Foundation, a non-profit group promoting free market principles throughout the food chain. He can be reached at [email protected]

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