USDA warns furloughs could affect packing industry

News
Feb 15, 2013
by DTN

Across-the-board federal budget cuts could force US- DA to furlough up to 6,000 meat inspectors for up to two weeks, plunging the meat industry into chaos and raising consumer prices, U.S. Agriculture Secretary Tom Vilsack said in a speech to the National Biodiesel Board Thursday.

In wide-ranging comments after his speech on the sequestration and the prospects for a new farm bill, Vilsack said the sequestration, an across-the-board cut in government spending set to go into effect on March 1 if Congress does not change it, would require USDA’s Food and Safety and Inspection Service (FSIS) to “furlough over 6,000 food inspectors for two to three weeks.”

“As soon as you take an inspector off the floor, that plant shuts down,” Vilsack added, noting that removing inspectors even for a short period would affect several hundred thousand workers and would affect the supply of meat and, eventually, consumer prices.

A USDA spokeswoman said there are about 6,500 federal meat inspectors.

The sequestration, Vilsack said, “is horrible policy,” adding that the potential problem at FSIS “is just a tiny piece of my life.”

“It is really hard to manage the department,” Vilsack said, adding that sequestration will require that the cut be made in six months, which means it is essentially double the percentage required.

Some Republicans have proposed that cuts to the Defense Department should be avoided and the way to do it is to increase domestic cuts, which could make the problem at the Agriculture Department worse. The Obama administration has proposed delaying the cuts and including a tax increase.

Vilsack said he is worried Congress might decide the way to avoid sequestration deficit reduction is to “do away with the direct payments” that crop farmers get whether prices are high or low. The problem with that, he noted, is Congress has been planning to use the $4.9 billion in annual budget authority for the payments to write a new farm bill.

He praised Senate Majority Leader Harry Reid, D- NV, for reintroducing the farm bill the Senate passed last year, but said he believes the Senate Agriculture Committee will have to adjust that bill because it will not satisfy Sen. Thad Cochran, R-MS, the new ranking member.

Vilsack also said he expects House Agriculture Committee Chairman Frank Lucas, R-OK, and House Agriculture ranking member Collin Peterson, D-MN, “to work their magic,” but that the dairy issue is still unresolved in the House.

He noted that dairy farmers want a program to support them when “milk and feed prices get to the point there is less than a $4 cushion between them,” but there has to be a mechanism that does not reward overproduction.

Vilsack noted that House Speaker John Boehner, R- OH, called the proposal last year “socialism” and said “somewhere they have got to figure out how to remove the volatility, create greater stability and not break the bank.”

Vilsack also told the biodiesel producers the farm bill needs a strong energy title and they should also form alliances to pass the “food, farm and jobs bill.” — Jerry Hagstrom, DTN

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