Smith Questions Value Of Cap And Trade Bill

Rep. Adrian Smith (R-NE) and other members of the House Agriculture Committee today held a hearing to review pending climate legislation commonly referred to as "cap-and-trade." In April, Smith called for this hearing to focus on the legislation's effect on America's agriculture economy.

The American Clean Energy and Security Act (H.R. 2454) would impose new greenhouse gas emissions standards and efficiency standards across the U.S. economy while creating the untested and complex cap-and-trade proposal.

Some groups have supported this legislation under the assumption agriculture producers would receive credit for cropland management practices, such as conservation or no-till practices which preserve soil carbon by maintaining a ground cover after planting and by reducing soil disturbance compared with traditional cultivation.

However, according to recently released information, the Environmental Protection Agency's revised 2009 projections are significantly lower than previous estimates, which were based on agriculture practices of the late 1990s, effectively zeroing out any benefit from soil conservation.

"I am saddened those who drafted this measure would mislead those who would most be affected by it. To put it simply, this bill is a national energy tax which will disproportionately target rural America and middle class families. This bill supposedly combats global warming by setting strict limits on carbon emissions, but in doing so it imposes enormous taxes and restrictions on energy use - placing an especially heavy burden on rural America and our nation's agriculture producers.

"Even a small increase in operating costs could devastate farmers and ranchers. For this reason and others, I have severe reservations about this bill, as do many of my colleagues on the House Agriculture Committee," Smith said.

The Heritage Foundation's Center for Data Analysis recently released an economic study regarding the impact a cap-and-trade system would have on the agriculture community.

Highlights of the study include:

* Farm income (after expenses) is expected to drop $8 billion in 2012, $25 billion in 2024, and more than $50 billion in 2035.
* The average net income lost from 2010-2035 would be $23 billion.
* Construction costs of farm buildings will increase from the baseline by 5.5% in 2025 and 10% by 2034.
* By 2035, gasoline and diesel costs are expected to increase by 58% and electric rates by 90%.

To date, nearly 50 agriculture groups - including the Nebraska Farm Bureau - have expressed opposition to this bill.

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