I woke up Saturday morning, fearing the first day of sequestration, remembering that it rhymes with unpleasant things like castration. I thought I would check Facebook before I peeked outside to see if the sky was falling. Lots of people get up before I do so I was looking for an early weather report from some of my rancher friends.
First thing that popped up was Texas Farm Bureau’s Gene Hall who proudly proclaimed “The republic still stands. Burger King still served me a biscuit, my paper was on the drive and my Internet still works. A thing called a sequester did not destroy us after all.”
Now Gene and I stand on opposite sides of the political spectrum. I prefer Hardee’s biscuits. They are far superior to those leaden lumps doled out by Burger King and I can only hope he has to visit BK because the nearest Hardee’s is too far away. But I agree the sequester hasn’t destroyed the republic. Yet.
One of the interesting things left on the table was the Senate Democrats' $110 billion sequester replacement bill which proposed $3.5 billion in new farm program spending. What doomed it to extinction, of course, were a few lines that suggested $54 billion in new taxes on millionaires. No way Boehner, Cantor, et al would be able to accept that little nugget.
There was another catch. To get $3.5 billion in new farm spending, Senate Agriculture Committee Chairwoman Debbie Stabenow (D-Mich.) agreed to cut $27.5 billion in farm subsidies known as direct payments.
Stabenow said, “I support moving forward with eliminating direct payments. At the same time, I have written this and negotiated this to make sure we are providing disaster assistance to our farmers and ranchers which do need it for 2013.”
She also worked two excellent provisions into the bill. The first was tied to her “Bring Jobs Home Act” and it would have ended the practice of companies deducting relocation expenses when they move operations out of the United States. Whether you are a Democrat or Republican, the idea of using tax money to help move American jobs overseas should make you cringe.
The Stabenow bill also closed some gaps by including disaster assistance for agriculture sectors left out of the "fiscal cliff" deal passed in early January and funded energy, conservation and specialty crop programs that were not part of the short-term farm bill extension.
All water under the dam, now. Despite Gene Hall’s good cheer, almost everyone thought the sky would not fall Saturday morning. Instead, the sequester would perform like a very slow moving blizzard, gridlocking massive amounts of our economy inch-by-painful inch over several months. As we all work hard to clear our financial streets, the detritus would have to be piled up on the sidewalks and it would stay there for months – maybe years – afterwards.
It was two weeks ago that The National Cattlemen’s Beef Association (NCBA) expressed “severely disappointed” with Secretary of Agriculture Tom Vilsack’s statement about the possible 15-day furlough of all Food Safety Inspection Service (FSIS) employees, including meat inspectors at the nation’s beef processing plants.
Because inspection is required before meat can be shipped to interstate commerce, Vilsack’s comment meant we were looking at shutting down every meat plant of consequence for 15 days. No work for tens of thousands of employees, no meat on the dinner table, empty shelves at the super market. Even Whole Foods would have to shut down. By the time inspectors return, many of those plants will be bankrupt and unable to reopen. And don’t expect to stock up on Australian or Brazilian meat. Inspection in foreign plants will cease, too.
We will become a nation of vegetarians almost overnight.
NCBA president Scott George accused Vilsack of “using America’s cattlemen and women as pawns in the agency’s political wrangling with Congress.”
Colin Woodall, vice president of government affairs for NCBA, euphemistically called it “an unfortunate situation.” He said, “We think there are a lot of non-essential cuts that could be made at USDA to cover whatever budget restrictions are going to be required.”
Woodall’s next point should be well-taken, though. “We feel that inspection is an essential function and component of USDA, and should be maintained.”
A careful reading of the sequestration bill, though, shows Vilsack probably doesn’t have a choice. The cuts are to be made across the board with no thought to the consequences. The frivolous as well as the vital will be made to suffer the consequences equally.
Indeed, stopping inspection could mean killing an industry. If meat and poultry plants are forced to close for even a few weeks, it would cause a complete and immediate stoppage in the flow of cattle and poultry, all the way to the producer level, costing animal agriculture and the farm-to-fork supply chain hundreds of millions of dollars.
And it is at that point that Chicken Little would be right. The sky would fall. The economic cave-in would be devastating. Our landfills could soon be awash in a tsunami of uninspected meat and poultry carcasses.
Helena Bottemiller, writing for Food Safety News, quoted Vilsack’s recent statement at the Commodity Classic, a convention of corn, soybean, wheat and sorghum farmers. “Make no mistake about it, there is not enough flexibility in the sequester language for me to move money around to avoid furloughs of food inspectors,” he said.
“It is not something I want to do, it’s not something I like doing, but it’s the law and it’s something I am going to have to do, unless this thing gets resolved,” he added.
“The way this is structured, every line item of our budget and every account that’s not (specifically) exempted by Congress has to be cut by a certain percentage,” he said, and “it won’t just be the roughly 8,000 meat inspectors in more than 6,000 plants that are impacted, but also the 250,000 people who work in the plants.”
Of course one option might be the immediate change to the HIMP guidelines first proposed over a year ago and pushed relentlessly by USDA Food Safety and Inspection Service Administrator Al Almanza. A ferocious backer of the plan, he has hammered home the advantages of the program during several discussions I’ve had with him. “Fewer inspectors, faster production, safer product,” is his constant litany which he says is absolutely proven by the data.
HIMP, the HAACP-Based Inspection Models Project, shifts responsibility from government inspectors at poultry processing plants to company personnel. Data gleaned from several years of testing at poultry plants back up Almanza’s claim but expansion to over 200 facilities raised red flags and hackles among foodies and their watch dog organizations. Several USDA inspectors also called it an immediate threat to food safety.
Bravely talking out of class, Vilsack said, “This shouldn’t happen. In a functioning democracy, this shouldn’t happen. People should recognize that we have fiscal issues and we should address them – it’s a combination of additional revenue and cuts.”
Shutting down the entire meat industry would take a huge amount of food out of the system, putting an unbearable strain on the items that could still find their way to your neighborhood Piggly Wiggly. Paying $10 for a head of lettuce and breakfasting on year old corn flakes soaked in reconstituted dry milk powder will make even a sausage biscuit from BK sound like a culinary treat.
So here’s the deal. A compromise on the budget can be made anytime the House and Senate, the Democrats and Republicans, and Boehner and Obama can agree to agree. It can be next week or next month but it absolutely must be made before the sky falls. Although the supply of poultry can be turned off rather quickly, the spring calving season will not wait.
The opinions expressed in this commentary are solely those of Chuck Jolley, a veteran food-industry journalist and commentator.