In the seemingly interminable talk about whether or not the World Trade Organization's Doha Round can be revived, another less-discussed trade issue may turn into a bargaining chip for agriculture.
It's the Trade Promotion Authority, which gives the president authority to enter into trade agreements, on which Congress can then only vote “yea” or “nay,” but cannot modify.
“TPA expires in June 2007,” says Mark Lange, chief executive officer for the National Cotton Council, who spoke at the mid-year meeting of Mississippi's Delta Council, “and unless it's renewed, no country is going to negotiate with the administration if it's known Congress can amend whatever's agreed to.”
The suspension of the WTO's Doha Round, the November congressional elections, and the looming presidential election cycle may well mean there's little chance of bringing farm bill legislation to Congress prior to the expiration of the president's trade promotion authority, Lange says.
“I think this may give cotton an opportunity to say, ‘The only way we'll support the extension of the TPA is if the agreement doesn't isolate any agricultural commodity.
“The WTO has a cotton-specific text, and I think suspension of the talks gives cotton an opportunity to put a slam on further moves in this area. We've made it clear that the only way the Doha round can be successfully negotiated is if they don't start parceling out commodities.”
Lange says the looming expiration of the president's trade promotion authority “puts us in a great negotiating position, and I think we're going to have some luck getting congressional support for this.
“Why should any agricultural commodity be isolated in any international trade agreement, whether it be dairy, sugar, cotton, whatever?”
Given the unlikelihood of reviving the Doha round and accomplishing anything meaningful in time to complete a new farm bill in 2007, some commodity groups have expressed support for extending the current law for one to four years to wait and see what the WTO does.
The other option, Lange says, is to go ahead with development of a new, changed farm bill.
“But if we do that, I think it will be ugly, because I don't think we can get the budget authority necessary for anything like the farm bill and supports we've had the past several years.
“Budget authority is the key. We can debate all these things endlessly, but if we can't get budget authority for a farm bill, then I think we'll need to extend the current legislation in order to try and protect ourselves.”
But extension won't be a clean-cut process, Lange says. “Various groups can say, ‘Yeah, I'm for this, but I've got a problem with that.’ It will bring a whole new set of problems.
“Also, the administration is not likely to support extension at this point because they've got Secretary of Agriculture Mike Johanns still out talking about the kind of farm bill he thinks we ought to have — one that meets his criteria of equitable, predictable, and beyond challenge.”
Whether the current legislation is extended or there's debate on a new farm bill, anti-farm groups and non-governmental organizations (NGOs) “will be muddying the waters something terrible, particularly with regard to payment limits. For example, Oxfam (a development, advocacy, and relief agency working to end poverty worldwide) has contended that the most effective way to reduce farm supports is with payment limits.”
Lange said the American Farm Bureau Federation was expected to present its position to Congress for extension of the current legislation. “I think they will be a very visible presence, with a lot of press coverage, as they try to get as many commodity organizations as they can to stand with them. It will be interesting to see what the corn and soybean groups do.
“But I would be very surprised if there is a vote on extension in this session of Congress. If there should be a lame duck session, though, we could see a vote.”