Congressman calls for USDA to drop competition rules

News
Oct 1, 2010
by WLJ

Rep. Jerry Moran, R-KS, is calling for the withdrawal of the recently proposed Grain Inspection, Packers and Stockyards Administration (GIPSA) livestock procurement rule, citing a lack of economic analysis and errors in administrative procedures.

“While I have received a variety of complaints from producers, I am most concerned about the Department’s failure to conduct an economic analysis of the proposed rule,” Moran writes in a letter to Secretary of Agriculture Tom Vilsack. “I believe the lack of substantial economic analysis misleads livestock producers about the potential impact of this proposal and is contrary to the purpose of the Administrative Procedure Act and the requirements of Executive Order 12866.”

Moran notes that although GIPSA claims to have prepared an economic analysis for this proposed rule, simply stating an economic analysis has been completed does not make it so.

“At least ten times throughout the proposed rule, GIPSA restates some version of the phrase, ‘GIPSA believe that potential benefits are expected to exceed costs.’ Despite these conclusory statements, GIPSA provides neither quantitative nor qualitative data to support this conclusion,” Moran writes. “The only section of the proposed rule that displays anything resembling quantitative data is analysis of how much it might cost affected parties and GIPSA to keep additional records.”

Moran says that compounding the concern are the results of GIPSA’s most recent study of alternative marketing agreements (AMAs) which concludes that restrictions on the use of AMAs would have negative economic effects on livestock producers, meat packers and consumers. Restrictions are a certainty under the rule.

Of additional concern to Moran is the lack of notice regarding the recent public workshop on competition held at Fort Collins, CO, on Aug. 27. During the workshop, Vilsack stated that comments made would be included in the comments on the proposed rule. “I view this announcement by you, after the workshop had already convened, to be a serious violation of the Administrative Procedure Act,” Moran states.

“Due to the above mentioned inadequacies of the proposed rule, I ask USDA to withdraw the proposed rule,” Moran concludes. “I also ask that USDA not resubmit a new proposed rule until an economic analysis is completed and made public by the USDA Chief Economist and proper notice is given by USDA as to the time, place and nature of all public rule making proceedings.” — WLJ

{rating_box}