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The history and impact of agricultural trade policy in the united states

Policy decision-making is analyzed by means of three variables: The study refers to the corn sector and observes how the National Corn Growers Association operated to ensure subsidies and incentives for this supply chain along the elaboration of the 2002 and 2008 Farm Bills, as well as from other laws pertaining to agricultural and energy incentives.

This paper provides evidences in favor of four arguments: United States; international trade policy; agricultural lobby; corn; ethanol On January 11, 1980, President Jimmy Carter signaled the need for the U. The farmers to which Carter referred to relied on a solid background of support received as farm subsidies. Keeping the income in the agricultural sector, aiming at productivity gains without food overproduction, also contributed to consolidate the agricultural protectionist model VEIGA, 1994.

During the 2002, 2008 and 2012 electoral campaigns, because they were interested in the votes of delegates from Iowa, Illinois, Minnesota and Nebraska Electoral College, all candidates were convinced ethanol was the panacea to ensure cheap energy, and the end of the dependence from oil sheiks in the Middle East would revert global warming. Since then, as an illustration, we could mention subsidies and incentives that resulted from the Farm Bill. The 2002 Farm Bill was the first one to include energy titles, which were renewed in 2008.

Another way to foster production occurred in 2004, when the U. RFS establishes mandatory volumes of renewable fuel in transport, meaning it ensures ethanol demand and has a consumption goal of 36 billion gallons of ethanol by 2022. According to many experts, RFS was interpreted as a 'gift' from the government to corn and ethanol producers. As we all know, the fact that the agricultural policy is subsidized in the U. But understanding what strategies support those policies may enlighten many new aspects, particularly when it comes to corn producers, the history and impact of agricultural trade policy in the united states gained more importance in the context of ethanol production in the U.

As a result, some important questions can be raised: What are the drivers and the key assumptions to keep subsidies for corn and ethanol supply chain, in spite of all the consequences in the international scenario? How do ethanol interest groups act and how powerful are they to keep subsidies, through the Farm Bill and energy bills in the U. The answer to those questions will come, firstly, from the theoretical discussion about the agricultural policy decision-making process in the United States.

We will also show that the key for that project to be successful is the ability of interest groups to mobilize information in order to convince politicians and the society to support their specific demands as general strategic interests for the United States. According to Putnam 1993interest groups at the national level, tend to meet their goals by placing pressure on the government in such a way that policymakers elaborate policies that benefit them.

At the international level, Putnam 1993 argues that governments seek to maximize their own ability to satisfy domestic pressures, while minimizing the adverse consequences of external development.

If a certain agreement matches the expectations of those groups, it will be ratified faster. However, "those who stand to lose should try to block or try to alter any international agreement, whereas those who may profit from it should push for its ratification" MILNER, 1997p. One of the reasons why it happens is the defensive ability of small interest groups with organizational expertise to advocate for their demands on electoral bases with political relevance ROGOWSKI, 1990.

Additionally, those groups may signal with a green or red light to internationally legitimize a domestic public policy. Manipulation of institutions and information by interest groups in that matter is critical for ratifying or vetoing international agreements.

Channeling sector interests from the civil society into the international negotiators depends on the State domestic institutions.

In this sense, according to Milner 1997domestic institutions are critical for dialoguing and providing information to interest groups. Consequently, mastering the operating rationale of institutional mechanisms for the formulation of international trade policy is as important as being good at mobilizing the public opinion, which would have significant influence on policy decisions and the interests they affect in an international negotiation.

This means that what makes interest groups work as influencers is, mainly, their ability to have access to information and their expertise to connect with institutions directly linked to their interests in the international trade arena.

Oftentimes, this requires demonstrating that the sector interests of those groups are strategic for domestic interests. Therefore, their success in advocating for sector interests relies on their ability to mobilize institutions and information and properly channel them into the international negotiators MILNER, 1997camouflaging their specific interest as a general structural interest.

Independence and energy security, environmental protection and agricultural preservation are impacting national appeals to convince society and politicians in the United States to support ethanol incentives. This specificity of our topic partially explains the bipartisan support strategy organized by the corn and ethanol supply chain for U.

United States agricultural policy: Its evolution and impact

For mobilization of the corn supply chain, the agroindustrial complex is diffuse, which makes farmers a fundamental link in a supply chain consisting of different actors, among them. Besides, there are other links in the chain, such as banks and financing agents, marketing firms and research institutions, as well as the government. Even though the sector is diffuse and has no identical specific interests throughout its supply chain, it is possible to determine and seek common interests.

In this sense, interest groups associated with ethanol in the U.

For example, constant estimates of local creation of jobs is something those groups often include in their speeches. Following this rationale, Almond et al. Those agroindustrial interest groups can be sorted into two groups: The groups with general propositions are older. NCGA is a specific group created to ensure the interests of corn at the national level. Ethanol and corn production is concentrated in the Corn Belt, located in the Midwest of the country, which makes the geographic aspect more relevant than the ideological aspect, since grassroot strategies, i.

The lobbyists' power to enforce their interests is attributed to their ability to raise financial resources and have privileged access to government members. Corporations donate money to candidate campaigns and to party committees, and finance lobbyists to put pressure on congresspeople to approve or oppose to bills according to their interests KIM, 2008.

  1. Congress' preference for keeping farm subsidies in the U. This way of acting works as they convince government public servants that their propositions are aimed at generating reciprocal benefits, such as cooperation in management of existing policies, information about what is going on in their industry, assessment of the consequences of policies and, lastly, assistance to implement new policies.
  2. This means that having expertise to monitor and change public policies is key to succeed in the submission of demands and interests in any democratic country.
  3. However, NCGA represents the sector nationwide.
  4. In the Senate, voting occurred on February 13, 2002, with the following results.
  5. But it will definitely buy you some access so you can make your case" apud KIM, 2008, p , p. There are many scheduled events, conferences, webinars and meetings that encourage interaction and exchange of information among government employees and representatives of the agroenergy sector.

The volume of financial resources assigned to lobbying in the U. Values spent on electoral campaign and lobbying are considered an indicator of the interest of economic groups in a certain topic. Nevertheless, this does not mean bills are bought following a commercial rationale, in which campaign contributions are exchanged for congresspeople's votes.

Thomas Downey D-New York said: But it will definitely buy you some access so you can make your case" apud KIM, 2008, pp. This happens because, simultaneously, interest groups also participate in the political process working as advisory bodies for government and parliamentarians, informing them about the desired path for public policies of their interest.

In this task, those groups seek to mobilize information on governmental policies and their changes, as well as to familiarize with established policies management.

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This way of acting works as they convince government public servants that their propositions are aimed at generating reciprocal benefits, such as cooperation in management of existing policies, information about what is going on in their industry, assessment of the consequences of policies and, lastly, assistance to implement new policies.

Thus, from elections to government routine practices, information is critical. On one hand, it is important for politicians to know how to identify the demands of their constituents to ensure their election, reelection and the election of their successors.

On the other hand, it is fundamental that constituents and interest groups are informed whether the behavior of the politician they elected complies with their demands and interests. This means that having expertise to monitor and change public policies is key to succeed in the submission of demands and interests in any democratic country.

Basically, interest groups act in two spheres: In the electoral sphere, economic groups may influence election results by financing campaigns of candidates with whom they are politically aligned. This means that, even before election, candidates rely on the funds raised to finance their campaigns, so they are more likely to incorporate propositions made by their financiers into their platform THOMAZ, 2012.

Usually, both in the electoral and in the congressional spheres, partisanship and ideology play a role when it comes to satisfying the demands of economic groups. But, as previously mentioned, the ethanol case is interesting because it counts with bipartisan support. For instance, constituents from certain agricultural districts tend to elect candidates from the Republican Party, who, on their turn, have their campaigns financed by the Political Action Committee from large corporations, thanks to the political affinity between the financiers agenda and a more conservative party program.

However, when ethanol emerges as an option to be supported, those groups count with the support of the Democratic Party, which historically supports environmentally-friendly policies.

So, that's why they can state ethanol counts with bipartisan support. This means this topic is seen as the history and impact of agricultural trade policy in the united states State matter in the U. Aware of such a scenario, corn and ethanol interest groups seek to adjust their media framing strategies in real-time, creating messages geared towards different ideological groups and political parties. They also hold meetings and briefings to educate the audiences about the need to keep their support of the American energy cause.

According to Friman 1993this is required to "combine emotional appeals to patriotic duty and self-sacrifice with arguments that incorporate widely held beliefs on the nature of basic challenges to those core values" FRIMAN, 1993p. They then build mechanisms to drive a powerful public opinion current with the main mission to establish mental codes which are socially shared and favor specific interests demanded during critical situations.

Their goal is to ensure specific gains for segments adopting a national strategic perspective, i. This is how technical-scientific knowledge and access to information play important roles in the perceptions and opinions of decision-makers.

The way how interest groups interpret those propositions and later inform policymakers about their consequences is decisive to determine the position of the latter concerning legislative propositions to keep or alter policies.

Thus, interest groups work as 'perceptual filters'. Corn lobby in the U. According to Fordham and McKeown 2003the advantage of a geographic concentration is the cohesion and coordination of economic group strategies, whereas the disadvantage lays on the resistance of members of the Executive and Legislative branches to meet the demand of a minority with spatial concentration as opposed to the preference of most constituents. However, NCGA represents the sector nationwide.

Its mission is to create and increase opportunities for profitability and use of the corn culture. For this reason, according to their website, NCGA has interests divided into key sectors, such as: Such thematic diversity around corn and ethanol production indicates NCGA coordinates a national supply chain of significant economic relevance.

In this sense, the appeal to seek new energy matrixes makes the ethanol issue critical for specific interests of the sector to be consensually seen as a U. As we have seen, economic sectors with this characteristic can drive the State to act according to their specific interests. Aware of this specificity, NCGA 2009 seeks to build consensus around the idea that it is better for U.

According to the association, renewable fuels will enable a cleaner environment, contributing to decreased dependency upon foreign oil, especially from the Middle East and from Venezuela. Additionally, communities that depend on the corn supply chain will benefit with job creation, through the development of the renewable fuels industry.

Those arguments are aligned with speeches made by relevant politicians in the U. In order to meet this target, members of the association from different states are motivated to pressure on subnational government levels so they approve laws to encourage flex-fuel vehicles production and use in their territories. Thus, NCGA aims at providing consumers and the government with information on the economic, environmental and energy security benefits, also promoting the E-diesel ethanol-diesel blendsbiodiesel, ethanol as an aviation fuel, etc.

NCGA has tried to identify and encourage production of vehicles that can be operated using renewable fuels.

In order to support that measure, the association managed to convince the government to assign funds generated due to non-compliance with CAFE 3 by automakers to extend production and use of E-85. NCGA also tries to keep competitive balance, assessing those program options to anticipate what might harm the expansion of the ethanol industry.

That's why it gathers information about cellulosic technology to produce biofuels. Ethanol derived from other materials such as cellulose can complement corn ethanol. Additionally, they encourage research and financing to increase food production both for the population as a whole and for animal feed.

  • As for members of the USTR private advisory system, they are asked to vote for acceptance or rejection of the trade agreements before Congress proceeds and ratifies the agreement;
  • Divergences between both Houses regarding the project were solved on May 14, 2007;
  • During the 2002, 2008 and 2012 electoral campaigns, because they were interested in the votes of delegates from Iowa, Illinois, Minnesota and Nebraska Electoral College, all candidates were convinced ethanol was the panacea to ensure cheap energy, and the end of the dependence from oil sheiks in the Middle East would revert global warming;
  • In my view, a key focus of this new legislation must be promoting new economic and income opportunities for farm families and others in rural communities;
  • As for ethanol production, NCGA argues that use of ethanol to replace conventional gasoline contributes to reduce greenhouse gas emissions.

Such commitment is associated with the search for technological innovation. In the past 30 years, farmers have significantly reduced the amount of fertilizers needed to cultivate corn. Beth Elliot, Director of Public Policy at NCGA, pointed out how corn and ethanol growers can prepare very good defense at Congress hearings that question whether ethanol is a sustainable fuel: Generally speaking, I think that our farmers are very well spoken.