Majority Republican House Likely to Conduct Oversight of USDA's GIPSA Proposals

When Republicans take over the House in 2011, Capitol Hill observers predict the new majority will conduct oversight hearings on a wide range of Obama administration policies and programs.

When Republicans take over the House in 2011, Capitol Hill observers predict the new majority will conduct oversight hearings on a wide range of Obama administration policies and programs. One of these almost certainly will be the controversial meat, livestock and dairy marketing rules being proposed by USDA's Grain Inspection, Packers and Stockyards Administration.

GOP-led oversight hearings could lead to proposed legislation that at a minimum would mandate that USDA conduct a more comprehensive economic analysis of the proposed regulations than was done as the proposed rule was being developed.

In true bureaucratic fashion, an issue is considered "significant" if it would have an economic effect of under $100 million, but "economically significant" if its potential effect is estimated to exceed that threshold. In USDA's estimation, its proposed GIPSA rule fell short of the $100 million trigger point, and so the analysis it conducted was not as thorough as if the rule was deemed "economically significant." Critics of the rule want to know who made that decision as well as the basis for the decision.

Some 115 current House members –– including 46 Democrats –– have called for USDA to revisit the issue and to conduct the more thorough economic analysis, but Agriculture Secretary Tom Vilsack so far has declined to do so.

For his part, Vilsack recently said the coming rule would be "workable, feasible and commonsense." Summarizing the themes of the recently completed joint USDA and Department of Justice workshops on concentration and competition in the agriculture sector, Vilsack said livestock and poultry producers want to have or maintain marketing options, want transparency and access to markets, in addition to being treated fairly and with respect by market participants.

On Dec. 13, Vilsack held a meeting at USDA headquarters with those likely to be most affected by the new rules to give him an opportunity to answer any questions the stakeholders might have about the process USDA had adopted for drafting and proposing the new rules. Participants the secretary indicated USDA would be conducting another analysis of new GIPSA rule, but that they doubt that the next analysis would be as thorough as some in Congress apparently would like to see.

Vilsack reportedly did not venture a guess as to when the final rule might be issued, largely because of uncertainty of the amount of time it will take department officials to review the rule and conduct the new analysis. Following those internal USDA steps, the rule then would be forwarded to the White House Office of Management and Budget for review, with no deadline established for that process.

The proposed rule has been criticized by many in the meat and poultry industries who complain that it would undo many of the marketing techniques that have developed over the past decade that have helped provide better quality animals to the market. Supporters, however, say the rule would provide protections for small livestock and poultry producers from economic abuses at the hands of increasingly large meat packers and processors.

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