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Farmers and Congress Shouldn’t Fall for this Hat Trick

SOURCE: AP/Cristobal Herrera

American Farm Bureau President Bob Stallman (above center) is urging farmers to join a “Don’t Cap Our Future” campaign by sending farm caps with that message to legislators.

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Just as they did in the weeks leading up to House passage of the American Clean Energy and Security Act, H.R. 2454, in June, big agricultural lobbyists are again trying to derail passing legislation to cut global warming pollution. This time their focus is the Clean Energy Jobs and American Power Act of 2009, S. 1733.

The American Farm Bureau, which touts itself as the voice of agriculture, recently launched another effort to convince senators that legislation to reverse the growth of global warming pollution and set the nation on a low-carbon energy course will deal a devastating economic blow to farmers and consumers.

“The consequences of climate legislation far outweigh the benefits and aren’t worth capping America’s future,” wrote Farm Bureau President Bob Stallman in urging farmers to join a “Don’t Cap Our Future” campaign by sending farm caps with that message to legislators.

Rather than engaging in a cheap hat trick, farmers and those purporting to advocate on their behalf should look at three key issues regarding energy and climate legislation: the cost of doing nothing, the modest cost of doing something, and the very real economic benefits the Senate and House legislation can bring to farmers and rural America.

In a warming world, American farmers will increasingly have to deal with severe weather events including droughts, heavy downpours and flooding, and high temperatures that often reduce crop yields, according to “Global Climate Change Impacts in the United States,” the authoritative report issued earlier this year by the U.S. Global Change Research Program. Warming will also accelerate crop and rangeland damage from weeds, plant diseases, and insects, the report predicts.

“[U]nder higher heat-trapping gas emissions scenarios, the projected climate changes are likely to increasingly challenge U.S. capacity to as efficiently produce food, feed, fuel, and livestock products,” concludes the report.

Several other research efforts have come to the same conclusion. According to research published in August in the Proceedings of the National Academy of Sciences, three of the nation’s most important crops—corn, soybeans, and cotton—are likely to show yield declines of 30 percent to 46 percent over the next century under the most optimistic warming scenarios. Under the most rapid warming scenarios crop yields would fall by 63 percent to 82 percent.

If those threats seem like they’re in the distant future, consider this: Worldwide, farmers have already paid a heavy price for climate change, according to a 2007 study that looked at crop losses due to warming between 1981 and 2002. The researchers concluded that crop losses for maize, wheat, and barley totaled $5 billion a year during that period.

As National Farmers Union President Roger Johnson told the Senate Agriculture Committee in July: “To state it simply, the cost of no action must become a central part of the ongoing climate change debate. Models of climate change scenarios demonstrate increased frequency of heat stress, droughts, and flooding events that will reduce crop yield and livestock productivity.”

Taking action to cut warming pollution won’t be free, of course, but it will be far less expensive than many alarmist opponents claim.

For starters, even though agriculture contributes about 6 percent of the nation’s output of carbon pollution, farmers are completely exempt from the mandatory limits on emissions that will apply to many large industrial sources under the House and Senate bills.

“If the United States adopts a cap-and-trade policy to combat climate change,” concludes Bruce A. Babcock, director of the Center for Agricultural Rural Development at Iowa State University, “the negative impacts on agriculture will likely be relatively small, particularly if agricultural emissions remain uncapped.”

Babcock reaches that conclusion after figuring out what Iowa’s corn and soybean farmers will pay in additional fuel and fertilizer costs under a carbon pollution policy such as that proposed in the House and Senate bills that results in a $20 per ton cost for carbon, and what they can expect to earn by selling carbon allowances to help polluters more cheaply reduce their pollution. Farmers can create offsets by storing carbon in the earth via farming practices such as no-till farming, capturing methane from animal manure, using less fertilizer, and planting trees.

The added fuel and fertilizer costs for those Iowa farmers, wrote Babcock, totals $4.52 per acre, about a 1.5 percent hike. By switching to no-till farming they can earn $8 an acre by selling that pollution offset.

And there’s even more potential for farmers to profit from offsets. Looking at both the agriculture and forestry sectors, the Pew Center on Global Climate Change estimates based on EPA models that offsets for sequestering carbon could be worth up to $22 billion a year by 2020 if the price of carbon reaches $30 per ton.

Taking the long-term view that includes the damage global warming will do to farming, Babcock concludes that “any disruptive change in climate will have a far greater impact on livelihoods than will the price of carbon.”

Agriculture Secretary Tom Vilsack repeatedly said that climate legislation would be a net plus for agriculture as he traveled through farm country in the summer, not just because farmers will be able to sell pollution allowances but because under the clean-energy incentives in the legislation rural areas that have wind, biomass, and solar resources will see a surge in economic development.

“This is the first time I’ve seen the opportunity created for rural America to actually benefit from potential manufacturing opportunities and job growth because the solar panels, the windmills are most likely going to be constructed, maintained, and installed in rural areas,” Vilsack told farm broadcasters in August.

The Agricultural Carbon Market Working Group also predicts a more profitable future for agriculture under a policy that reduces global warming pollution. “Analysis indicates the increase in farming income from offsets, biofuels, and commodity prices resulting from a cap-and-trade system more than offsets any potential increase in the price of fuel, fertilizer, or other inputs for the agricultural sector,” the organization has reported.

The U.S. Department of Agriculture was also upbeat in its economic analysis of the House legislation. Short term, USDA predicts less than a penny on the dollar decrease in net farm income, and that cut could be covered by the sales of offsets. In the medium and long term, USDA concludes, “benefits to agriculture from an offsets market rise over time and will likely overtake costs.”

In a September paper, the Nicholas Institute for Environmental Policy Solutions at Duke University looked at the net effects of low-carbon policies on farm income and concluded that “the U.S. agricultural sector would benefit from a U.S. climate policy.” The researchers noted that producers can pass on some of their higher production costs to consumers, can earn additional revenue from advanced biofuels, and can profit in the offsets market.

“[P]olicies that support bioenergy and terrestrial greenhouse gas mitigation efforts could stimulate agricultural income significantly despite higher input costs and could lead to a net welfare increase for the agricultural sector as a whole,” the Duke study authors concluded.

Instead of sending a cap with a wrongheaded message to Congress, American farmers should be working to put a lid on climate change—and the American Farm Bureau—which are the real threats to their future.

Tom Kenworthy is a Senior Fellow at the Center for American Progress.

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