from Feed Stuffs:
...a key study recently conducted at the request of Sen. Saxby Chambliss (R., Ga.), the ranking Republican on the Senate Agriculture Committee, pointed to a very different outcome. That study was cited frequently last week by senators hailing from states that the study showed would suffer.
The study was conducted by Texas A&M University's Agricultural & Food Policy Center, which ran a computer modeling analysis of impacts of the House-passed cap-and-trade program on crops and livestock across the U.S. (Feedstuffs, Sept. 7). The center used its historic database of 90 representative -- or "virtual" -- farms for the analysis.
"The ground truth that this study shows is very serious," Chambliss said. "The study says 71 of 98 farms will be worse off under the House cap-and-trade plan, even in the early years of the program. Most concerning: The 27 farms that benefit do so only because other producers go out of business. Not one rice farm or cattle ranch benefits, while only one cotton operation and one dairy benefit mainly due to the fact that they both grow a significant amount of feed grains."
Chambliss reported that nearly all of the 27 farming operations that realize benefits under the House's Waxman-Markey bill are located in the midwestern Corn Belt.
The study indicated that the benefits are predominantly the result of increase revenue from higher prices because fewer acres were planted to these crops rather than income gains coming from payments under a carbon offset program.
"While, intuitively, we knew that there would be winners and losers in cap-and-trade, we did not know that the benefits and costs would be so disproportionate and regionally perverse," Chambliss said.
He asked, "How can we, as members of this committee, endorse a policy that favors only one part of the country while hurting all the others?"
Several senators, both Republicans and Democrats, seemed engaged in the same question.
Interestingly, the question was raised on the same day it was announced that Senate Agriculture Committee chairman Tom Harkin (D., Iowa) would hand over the chairman's gavel to Sen. Blanche Lincoln (D., Ark.), whose rice, cotton and poultry state would be among the losers under cap-and-trade.
