Food/Agriculture

Word came through late yesterday that as anticipated here the White House caved to Senator Grassley, providing assurances America would not be lifting its tariff on Brazilian ethanol anytime soon.

As interesting to me was that the Renewable Fuels Association, which is not like many things in Washington what its name suggests and does not support all renewable fuels just those produced by its members, saw fit to issue a press release going after me and Andrew Sullivan who graciously picked up some of what I had written on our corndog friends. They accused me of being an international consultant (true) who has worked closely with Brazil (also true). It helps to work with different parts of the world to actually know what's going on in them. In fact they characterized me as a Brazil nut. This hurt. Because I actually am not a big fan of Brazil nuts. They then went on to say that there are, despite my assertion to the contrary, credible experts who think corn makes a shred of sense. They listed a number of reasons why corn would make sense -- if you were just interested in using a feedstock that is already being produced for which we already have fancy subsidy programs that comes from states with a lot of political clout, for example. They also erroneously suggest that Sullivan and I implied (which we did not) that corn only comes from Iowa. In fact, I for one, know corn comes from lots of other places including Hollywood and Washington flackeries. But perhaps my language was not precise enough. 

So let's toss the ball right back at them. Please find a credible expert who believes that corn is the best possible feedstock from which to make ethanol or that corn is actually a more efficient source of energy than other feedstocks like sugarcane or likely next generation feedstocks. Once you've done that we can move on to the idea that subsidizing an industry with an unsustainable model is in the U.S. national interest or that having U.S. consumer pay more for fuel in the current economic environment is a good idea or that protectionism is really the answer. Or better yet, perhaps we can move the discussion on to why the U.S. continues to lavish subsidies on the ag business that distort world trade and, very often, primarily offer a payday to corporate farms and well-to-do larger farmers. 

Senator Charles Grassley, one of the six power brokers featured in the New York Times story today on the inner circle of senators who are shaping health care legislation, may not be one of the three Blue Dog Democrats on the group, but that doesn't stop the Iowa Republican from being pretty dogged when it comes to his own pet issues.

According to today's Congress Daily, the Finance Committee's ranking member has slammed the brakes on the confirmation of Thomas Shannon to be ambassador to Brazil. His reason? He seeks what is euphemistically called a "clarification" of Shannon's confirmation hearing statement that eliminating the tariff on ethanol imports would be "beneficial." Of course, by "clarification" the Senator means a complete reversal slammed down Shannon's gullet by administration higher ups.

In letters to Secretary Clinton and USTR Kirk Grassley wrote:

A clear signal of the President's stance on this issue would decrease the possibility of confusion in America's heartland and in Brazil regarding the ethanol tariff if Mr. Shannon were confirmed as Ambassador to that country."

Since Shannon, most recently U.S. assistant secretary of state for Western Hemisphere Affairs and by consensus the most talented and successful individual to hold that office in at least two decades, is one of America's very best diplomats he will of course, be far too circumspect to offer Grassley the "clarification" he deserves.

Let me try however. U.S. ethanol tariffs are indefensible on any level, yet another example of the system of agricultural welfare that has burgeoned in the United States thanks to that good old fashioned combination of backroom and checkbook politics that make America great. There is not a single credible analyst of biofuels (which is to say one that is not paid for by or affiliated with American agriculture) who thinks that corn ethanol makes a hint of sense. It is hopelessly inefficient and with every new development regarding next generation biofuels only grows more so. Brazilian sugar cane ethanol, the main target of the tariffs, is produced as much as eight times more efficiently. As such, it offers a cheaper, more abundant, more environmentally friendly alternative to American consumers at a time when one would have thought that concerns about reducing dependence on foreign oil and combating climate change would be at the forefront of our concerns.

But once again, America's electoral system rears its ugly head. So long as presidential campaigns begin in Iowa, Iowans like Grassley will use the system to put the interest of their state's three million citizens and the most vocal special interests within their midst like the corn lobby, ahead of the three hundred million or so of the rest of us. Further, in so doing, Grassley seeks to preserve yet another dimension of America's system of farm protection and subsidies that costs tax payers tens of billions each year, forces food prices higher (according to the likes of Nobel Prize winner Joe Stiglitz) and is the single biggest distortionary factor in the world trading system. I understand why he is doing it. It's just a shame he can. The system allowing individual senators to hold up presidential nominations is regularly abused and needs to be reconsidered.

It is now July and the Obama administration does not have its own ambassador in Brasilia, capital of one the rising powers that is most important to us in the world. The guy who is there now, Bush's appointee Cliff Sobel, is widely regarded by Brazilians (and anyone else who is paying attention) as a joke whereas Shannon is seen as the crème de la crème of the U.S. diplomatic service and is a nominee viewed with great enthusiasm by the Lula administration. The Shannon pick said "Brazil is important."  Grassley's move says "all politics is local." 

It will be interesting to see how this plays out given that Grassley is so important to the prospects for health care reform. Grassley, who is as canny as they come in the Senate, knows the hand he holds and is betting he can get the Obama team to commit to keeping the tariffs as part of the wheeling and dealing associated with health care. I wouldn't bet against him.

As they say around state fair time in Des Moines, "ain't nothing like a corn dog."

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During the first part of their meetings, it looked like G8 leaders gathering in Italy had taken a page out of the books of small children everywhere, elevating the wish list to new diplomatic prominence. 

Unable to fulfill the hopes of their constituents to actually do anything meaningful about the global economy, nuclear proliferation or the rapid onset of climate change, the officials meeting in L'Aquila instead produced a barrage of strongly worded aspirations. To whom they, the most powerful men and women in the world, were appealing is open to speculation although there were rumors of naked dancing in the moonlight and animal sacrifices. (Italian insiders however, urged that not too much be read into these rumors as they typically accompany any party thrown by Italian Prime Minister Silvio Berlusconi...a man who combines the best of many of his famous countrymen, the low-key restraint of Roberto Benigni, the touching spirituality of Pope Alexander VI, and the values of the Roman Emperor Caligula -- as portrayed by Malcolm McDowell in the Bob Guccione classic of the same name.)

Among the wishes expressed by G8 leaders for us during the first day or two of the meetings were: a more peaceful, prosperous, temperate planet (also rainbows, unicorns, and butterflies). And yet no specifics as to how to achieve these goals were agreed upon. However, in lieu of the next summit, there is talk of simply buying the world a Hallmark card instead.

Given the likely future for the G8, however, as it has been unable to cast aside certain members who make it look hopelessly outdated (that would be you, Italy) and replace them with other, actually important countries, some critics suggest that in lieu of a wish list what the G8 might be better focusing on is a bucket list -- a list of things the G8 should do before it dies. Paradoxically, of course, the apparent agreement among the members of the G8 that something new and more representative of the way the planet works is in fact one of the two signs of real progress that the meeting produced.

It was confirmed by President Obama who, during his almost 40 minute post-G8 press conference, signaled that he has learned important lessons from his early summit experiences. As quoted by Agence France Presse, he said:

I think we're in a transition period. We're trying to find the right shape that combines the efficiency and capacity for action with inclusiveness.

"And my expectation is that over the next several years you'll see an evolution and we'll be able to find the right combination. The one thing I will be looking forward to is fewer summit meetings."

For those of us who have been calling for a new more inclusive "steering committee" for the community of nations, the search for a better country mix is good news. For those of us who like to see the President of the United States making better use of his time, the hope for fewer summits also is. (And despite the almost reflexive impulse some have to withhold credit from the prior administration...which seems churlish given how little credit they actually have any reasonable claim on...it is worth noting that Obama's focus on finding a successor to the G8 carries forward a process that really began in earnest when, last November, President Bush's team sought a G20 meeting to deal with the global financial crisis rather than a G8 meeting.)

In addition to this progress on an important point of process, the G8 leaders did make a hard commitment of $20 billion in farm and food aid for the world's poorest nations, another real accomplishment. We can always do more in this area...and should...I still feel that it is within the power of the leading nations to focus on and eliminate the daily deaths of 40,000 or so children from preventable causes like lack of access to clean water, adequate food, or medicine. It almost certainly would cost less than the stimulus money that will end up being wasted worldwide (which is not to say that all stimulus money is wasted...quite the contrary...rather it is to say we could make a big dent in the problem with just the spillage.)

So after a G8 meeting that gets a mixed grade and a semi-eulogy, Obama is off to Ghana...an excellent choice for his first visit to Africa as president. This will undoubtedly be a highlight of his trip and is certainly one place where who he is and how he is different from his predecessors will not only play well but will meaningfully advance the interests of the United States in the region.

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If you believe the American press, this is going to be the best week of Barack Obama's life. Not because his G20 and NATO meetings are predicted to be easy but because he is going to be in the land of his intellectual and spiritual roots, Europe. Here, among like-minded brie-loving, chardonnay-sipping, socialist fellow-travelers, he will be able to laugh at American gun-owners and Glenn Beck watchers with impunity. Perhaps, if the worst stories are to be believed, he will secretly fall into French during conversations, showing other leaders how he is more like them than he is like Sarah Palin by sharing a Gitane out in the alley behind his hotel (so Michelle doesn't see) or by giving them a glimpse of his non-U.S. birth certificate or reminding the Brits that his father and other ancestors were born (and beaten) in the Commonwealth.

Of course, not only is all this the province of snarky rumors being produced in the basement of the summer house Roger Ailes shares with his long-time secret lover Karl Rove, but also virtually all of it is untrue.  (I can't speak to what types of cheese the President likes or whether he, in a tip of the hat to European depravity, prefers his cheeses warm and crawling with bacteria.) But, there are plenty of ways the Europeans will be able to tell Barack Obama is not one of them. 

Here are 10:

1. Americans don't let their car companies go belly up. Instead, they commit the U.S. government to switch their full faith and credit guarantees away from something that is now dubious, like U.S. Treasuries, to something that needs to be rock solid, like warranties on Chevy Suburbans.

2. Americans stimulate. Europeans simulate. I speak of responses to the economic crisis, of course.

3. Americans may create enormous global problems, but then we actually feel some obligation to try to help solve them. Whereas Europeans, who used to create most of the world's problems, don't even do that anymore...and when it comes to solving problems, c'est pour les Americains, non?

4. Americans actually have a foreign policy.

5. Americans rock. Europeans technopop. We produce the music of this era, the continent of Mozart produces the elevator music of this era. (Johnny Depp's love of Vanessa Paradis notwithstanding.) Check out the playlist on Air Force One if you don't believe me.

6. Americans don't actually eat snails and rabbits and Swiss chard. Which is why Obama has brought his own chef and his own supply of organic arugula and free-range tofu. We also don't drive small cars or tolerate being condescended to by Euro waiters. Which is why the President is bringing his own car and his own waiters. (This is how every American would travel if they could.)

7. Americans don't let friends' banks go belly up. That's why the Treasury funneled so much money to European banks through AIG. You don't see European governments rushing to bailout Citigroup do you?

8. Americans love immigrants (see how we are even open to changing our minds about those whose asylum claims we once rejected...like Obama's Kenyan aunt, currently residing in public housing in Boston). Well, okay, we used to love immigrants (see all those stories about sending troops to the Mexican border). About the only thing the Europeans can agree on anymore is their long-standing hatred of immigrants. Oh and their hatred of carbon. But we hate carbon too, now. Which is a good thing. Although it does raise the whole specter of the self-hating carbon life form thing.

9. Americans don't actually speak other languages. We only speak American languages like English and Spanish.

10. Americans don't threaten to walk out of summit meetings before they have even begun...Mr. Sarkozy. But then, we wouldn't have left Carla home alone either. How do we avoid such walkouts? Well, generally, at meetings we just don't pay that much attention to what others are saying. It helps us stay "on message" as they say here in Washington.

Oh yes, and also, as we have mentioned before, he is a member of a racial minority group who has actually had the opportunity to reach the top in our society. Which would never ever happen in Europe.

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