LMD July 2012 by Livestock Publishers

Livestock “The greatest homage we can pay to truth is to use it.”

MARKET

Digest M

by LEE PITTS

Say “Cheese”

– JAMES RUSSELL LOWELL JULY 15, 2012 • www. aaalivestock . com

Volume 54 • No. 7

One Tough Customer “Most folks are like F a bob-wire fence. by Lee Pitts

or 30 years The United States and the European Union (EU) have been fighting a costly war with heavy casualties on both sides. Their long-standing battle is not over territory, religion, capitalism or socialism. No, their beef is over beef. Hormone treated beef to be more precise. The trade war has inflicted injury to numerous innocent bystanders on both sides of the Atlantic, such as producers of onions, carrots, mustard, glue, Roquefort dressing and American beef. After three decades of fighting both sides waved the white flag and have agreed to a fragile peace. Sort of.

Who Started It?

NEWSPAPER PRIORITY HANDLING

Ask most Americans what started this trade war and they’ll say it’s just protectionism, that the EU is using hormones as a non-tariff trade barrier. That may well be true, after all, in the late 1980s when our beef was first banned, there were huge stockpiles of beef in EU countries and policy makers there were trying to help struggling EU grazers by limiting imports. But it really wasn’t cattle producers who were leaning on their elected officials to impose the ban . . . it was EU consumers who had serious concerns over the safety of all food. Besides, Europeans have always

Riding Herd

They have their good points.” been highly suspicious of American farming practices, from genetically modified organisms to our intensive factory farms. This was just not the way things were done in Europe. To get to the bottom of the issue you must understand how the Europeans were thinking in the 1970s and 80s. There was a big furor over the illegal use of

diethylstilbestrol (DES) in the raising of French veal calves, followed by reports of hormonal irregularities in Italian children they believe were caused by the feeding of meat in school lunches that had been illegally produced using hormones. Although they never proved it, EU scientists said that was just because no samples of the suspect meat

existed for testing. American scientists simply said there was no scientific link. The issue flared up again when a synthetic hormone showed up in veal based baby food. In the 1990s the issue had no chance of getting resolved because you had mad cows ravaging the continent, killing consumers and financially destroying producers. In the EU at the time there was little trust of scientists, academics and politicians as far as cows were concerned, and they weren’t about to start talking about hormones when the voters were so deeply concerned about the safety of their meat supply. Then there was the issue of the bringing together of all the countries in the first place to form the Economic Union. (Many countries are rethinking continued on page two

When drought stops plants making protein, nitrate poisoning can kill grazing livestock by ROBERT KALLENBACH, University of Missouri

rought-stricken forages that accumulate nitrates can kill grazing livestock, quickly, warns a University of Missouri plant scientist. “We’re getting reports of cattle dying,” says Rob Kallenbach, MU Extension forage specialist. “As hot weather without rain continues, we expect to hear of more death losses. It happens at the start of every drought.” Large grasses, such as corn, sorghum and sudangrass hybrids, are most often the cause of problems, Kallenbach said on a statewide teleconference. Many plants, even ryegrass and fescue, can accumulate nitrates when soil moisture becomes short. Johnsongrass and other common weeds can be deadly also. Nitrogen is essential for forage and graincrop production. Nitrates are in the plants all the time, creating normal growth. Nitrogen picked up by plant roots from the soil moves up into the plant. Eventually the plant stores that energy in the seed heads as protein. Nitrates are converted into amino acids, which are building blocks for plant proteins. Protein is an essential part of animal diets.

Lack of moisture stops the flow of nitrates up the plant and the conversion to protein. The roots continue to bring nitrogen into the plant, where it accumulates first in the stalks. Too much unconverted nitrate can become toxic. In a drought, producers needing forage turn cows to graze corn, sorghum or other large grasses. Usually the only time a farmer grazes corn would be when it is obvious the plant will not make ears of corn for grain harvest. Grazing is considered when drought stops conversion of nitrate into protein. That’s when deadly trouble occurs. Cornstalks and other plants can be given a quick test for nitrates. A few drops of test solution on a split stalk turn deep blue when high levels of nitrate are present. Most MU Extension county offices have test kits to provide quick nitrate checks. This test gives only rough indications of potential problems. It’s a warning. A more accurate, quantitative test must be done in a laboratory, but that takes time. The lab test works best on stored forages such as bales, balage or silage. On the teleconference, a regional specialist

any people got upset over the report that the is using EPA drones to spy on feedlots in Nebraska and Iowa, but it wasn’t true. It was just a rumor. The EPA vehemently denied it and said, no, they are not using drones to spy on feedlots; they are using airplanes to spy on feedlots. Doesn’t that make you feel better? The EPA says they were just trying to protect people and I know I certainly feel safer knowing that our tax dollars are being used to spy on steers in North Platte. The EPA has the same means of aerial reconnaissance available as our military: drones, airplanes and satellites. But while our military uses them to spy on terrorists in Afghanistan, the EPA is looking for them in feedlots. But I don’t know of a single steer who has ever highjacked an airplane, set off an explosive device at a cattleman’s confab, or built a shoe bomb. Or, in their case, a hoof bomb. In fact, I don’t think a bovine has ever committed a single terrorist act in this country, unless you believe all the poppycock about cattle blowing up the world with the greenhouse gases they emit. Believe me, I know cows, and they aren’t the type to be suicide bombers. Come to find out, the EPA has been flying such spy missions for over a decade to determine if feedlots are in compliance with environmental laws in “impaired watersheds.” Whatever that is. According to the Air Force, any incriminating evidence found against what they call “US persons” during such spy flights can be shared with other government agencies and the cops. The EPA also says that “the EPA has never taken an enforcement action solely on the basis of these overflights?” So why do it? I find such spy flights disturbing because I HATE having my picture taken. That’s why most readers think I’m 30 years younger than I really am; because I continued on page five

continued on page eight

www.LeePittsbooks.com

Livestock Market Digest

Page 2

July 15, 2012

One Tough Customer that issue today for economic reasons.) Prior to the EU’s formation Italy, Denmark, the Netherlands, and Greece prohibited the use of hormones. Germany, which was the largest beef producer in the EU, prohibited the use of synthetic hormones only, while five other member countries, including France and the United Kingdom, permitted their use. In 1981 a resolution against the use of hormones passed 177 to 1 in favor of a complete ban. Complicating matters on this side of the pond was that many U.S. consumers were sympathetic to the cause of the Europeans.

continued from page one

tists say that when manure from factory farms where animals have been administered hormones enters the surrounding environment the hormones can contaminate the water supply. They cite recent studies they say show that exposure to hormones in just such a way has a substantial effect on the gender and reproductive capacity of fish. They also contend that children are particularly sensitive to these hormones and that they can cause sudden growth or breast development, genital abnormalities in baby boys, and unborn children of pregnant women could be abnormally affected.

U.S. lawyers point to the widespread and long-term use of hormones in over 20 countries as evidence that they inflict no harm. One of the biggest side effects of the trade war was the awakening of the general public to the whole issue of hormones. Both the Consumer Federation of America and the Center for Science in the Public Interest lobbied for a similar ban in this country, and in response to a survey conducted in 2002, 85 percent of those asked said they wanted mandatory labeling on beef produced with growth hormones. In many ways the transatlantic hormone dispute gave birth to the entire “natural” and “organic” movements in this country.

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In 1981, the EU restricted the use of natural hormones to therapeutic purposes only and completely banned synthetic hormones. The United States immediately cried foul and took its case to the new fledgling organization that countries around the globe had put so much faith in for solving such problems: The World Trade Organization. It was to be a United Nations for global traders and the beef ban was one of the first cases heard by the WTO. It came down squarely on the side of the Americans, and Canadians who had sided with them. It was a small victory for the USDA and the Food and Drug Administration who presented evidence that “hormones in beef from an implanted animal have no physiological significance for humans.” Despite the ruling, Europe ignored the WTO and persisted with its ban. Under WTO rules the EU would have won had they presented irrefutable scientific proof that hormones in beef cause health problems in humans. But after 50-plus years and 30 different growth-promoting products being used on livestock, the EU didn’t convince the WTO that there is any risk posed by hormones being used currently. Despite the ruling, EU scien-

They also argued that there is an increased risk of cancers later in life as a result of eating hormone tainted meat. The EU feels they have strong evidence and after its mad cow debacle, they would rather err on the side of caution. But the WTO doesn’t permit such caution and their position is that the hormone ban “is inconsistent with its obligations.” The U.S. position, on the other hand, is summed up in the words of a trade representative: “The human body is continually making the natural hormones that are subject to the EU’s ban, and these hormones also occur naturally in foods such as eggs and butter, often in concentrations substantially greater than in meat from cattle treated with these hormones." U.S. lawyers point to the widespread and long-term use of hormones in over 20 countries as evidence that they inflict no harm, and in 1997 a WTO dispute settlement panel agreed. This prompted the EU to commission even more studies to prove their point. But the WTO wasn’t buying it.

Carousel Retaliation Since the EU didn’t abide by WTO rules and get rid of their ban, the WTO proclaimed the U.S. had a right to add on a retaliatory tariff on EU imports valued at $93 million, which stayed in effect until May 1996. Then after still no relaxation of the beef trade barrier, the U.S. and Canada imposed $125 million in tariffs on EU goods. Here’s where the story gets a little crazy. It was determined that the initial ban caused harm to American ranchers to the tune of about $100 million. So the WTO allowed the U.S. to impose extra tariffs on such EU products as goose pâté, Roquefort cheese, truffles, onions, carrots, continued on page three

“America’s Favorite Livestock Newspaper”

July 15, 2012

One Tough Customer preserved tomatoes, soups, yarn, Dijon mustard, juices, chicory, toasted breads, French chocolate, jams, glue and wool grease. According to the WTO “the imposition of these higher duties is intended to restore the balance of trade concessions under the WTO and to induce compliance by the EU.” One would think that if it was our beef producers who were hurt that the 100 million dollars they supposedly lost as a result of the beef ban would be given back to them in some form. I know I didn’t get any part of the punitive tariffs, did you? Meanwhile, consumers on both sides of the ocean paid more for their food. How would you feel if you made Dijon mustard in Europe but were taxed extra on food you sold to the U.S. as a result of a beef over beef? Naturally, farmers in the EU protested the injustice, so in January 2009, the list of EU products subject to increased tariffs was changed. Those who produced onions, carrots, processed tomatoes, toasted breads, coffee, mustard, fish products, soups, yarns, and glue in the EU got a reprieve. Now the extra tariff would be applied to pork products, cut flowers and plants, processed fruits, nuts, fruit juices, oats, drinking water, confectionary and chewing gum. Those who made Roquefort cheese in Europe must have really made someone mad because their tariff rose from 100 percent to 300 percent! That’s right, when you ordered Roquefort dressing at your favorite restaurant you paid three times more

continued from page two

for it because of a dispute over beef hormones! The pain was not spread equally among countries either. Products from France, Germany, Italy, Denmark, Austria, Belgium, Finland, Greece, Ireland, Luxembourg, the Netherlands, Portugal, Spain, and Sweden were taxed, but products from the United Kingdom were not because they supported lifting the ban. And we wonder what those who produce hair clippers and motorcycles did to avoid the high tariffs, as they were scheduled to be on the tariff hit list as well, but were excused at the last minute. As a result of all these extra tariffs the EU went to the WTO once again to plead its case and claimed that these extra tariffs were an “escalation” of the trade war and “more punitive” than they needed to be. In response the WTO came down with a wishy-washy ruling that said the U.S. could continue its trade sanctions and the EU could continue its ban against hormone treated beef. The only good thing they came up with was that the EU had to allow in a limited amount of U.S. beef, but it had to be NHTC, or non hormone treated. In the U.S. there was no mad dash for this market and initially only 13 entities were audited and approved as sources of NHTC beef.

Cease Fire In 2009 the United States and the EU finally got together and agreed to at least try to agree. They signed a Memorandum of

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Understanding in hopes of resolving this long festering conflict. They agreed specifically on three things: First, that the EU would give the United States more market access. They’d allow 20,000 metric tons of beef (up from 11,500 metric tons) into the

metric tons and they would work on “longer-term resolution of the dispute.” As a result of all this haggling the volume of hormonefree beef exempted from tariffs will be set at 48,200 tons next month (August 2012). That’s 45,000 tons for U.S. beef and

It was determined that the initial ban caused harm to American ranchers to the tune of about $100 million. EU duty free. But it still had to be produced without hormones. It also had to be what they called “High Quality Beef”. Leaving themselves open for more disagreements in the future listen to how the WTO partially defined the “high quality beef” eligible for export to the EU. “Carcasses of heifers and steers less than 30 months of age which have only been fed a diet, for at least the last 100 days before slaughter, containing not less than 62 percent of concentrates and/or feed grain co-products on a dietary dry matter basis that meet or exceed a metabolizable energy (ME) content greater than 12.26 megajoules (MJ) per one kilogram of dry matter.” The restrictions go on like this for pages. Under phase two of the agreement the EU would grant increased quota up to 45,000 metric tons of “high quality beef.” In return, the U.S. agreed to reduce tariffs on selected products. During phase three of the agreement the EU would maintain the quota at 45,000

3,200 tons for Canadian imports. But who wants to jump through all the hoops necessary to qualify when there are other countries who want our beef and aren’t quite so demanding?

Who Won? So after 30 years who were the winners and losers of the hormone war? Some might suggest that the health-conscious American consumer won because the use of implants on calves sold through video auctions has fallen from 64.3 percent in 1995 to 26.2 percent in 2007. But that is a bit misleading. Ranchers who sell natural cattle have definitely received a premium from cattle feeders but a big part of that is the fact that the feeders want them natural so that when they administer the hormones they’ll get a bigger bang for their buck. It’s estimated that two-thirds of American cattle raised in feedlots are still treated with hormones. It doesn’t feel like American ranchers won because who need-

Page 3 ed the EU beef market as the U.S. has found plenty of willing buyers in other parts of the world. And U.S. beef exports don’t add up to a sizable share of the EU beef import market anyway. But perhaps before we get too cocky, we’d remind everyone that U.S. beef exports through April were down 11 percent from year-earlier levels. Exports to Japan were down 7 percent, Canada 6 percent and Mexico 9 percent. Exports to South Korea were down a whopping 32 percent as a result of our latest mad cow, and Hong Kong was down 18 percent year-over-year. A relatively stronger U.S. dollar is largely to blame. At the same time we brought into this country 22 percent more beef from year-earlier levels. So we’d suggest there is no market that we can flippantly ignore. Even if they are tough customers. As for the health risks associated with hormones, after 30 years of arguing we still have not reached a definitive conclusion on most of them. It seems we don’t know much more than we did back when this entire trade fiasco began. What about EU ranchers who were afraid of a massive influx of North American beef destroying their market? Did they win? Get this: after all the haggling and an increase in our quota, the EU actually sold more beef to us than we did to them! So who really won the hormone war? The landscape is liberally littered with losers on both continents. As for the victors, well, they are much harder to find. And despite the flimsy truce, the conflict still rages on.

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Industry Groups Intervene in Trapping Lawsuit o protect the businesses and livelihoods of their memberships, groups representing hunters, fisherman, agriculture, trappers, and rural communities and economies have intervened in a lawsuit filed by the WildEarth Guardians against the New Mexico Department of Game & Fish. The New Mexico Trappers’ Association, New Mexico Cattle Growers’ Association, New Mexico Wool Growers, Inc., New Mexico Federal Lands Council, New Mexico Council of Outfitters & Guides, New Mexico Farm and Livestock Bureau, Coalition of Arizona/New Mexico Counties for Stable Economic Growth and United Sportsmen for Fish & Wildlife, Inc., joined the lawsuit which would prohibit trapping in the southwestern New Mexico, in the Mexican Grey Wolf Recovery Area. The New Mexico Houndsmen as well as the Northern and the Southern New Mexico Chapters of the Safari Club assisted with funding. The Safari Club International also filed an Amicus

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Brief in support of the state. “The big difference between our memberships and the WildEarth Guardians is that our members have everything to lose in this situation, and environmentalists have nothing at stake. If residents of southwestern New Mexico lose the ability to trap, they lose their ability to make a living ranching, hunting, trapping or outfitting – not to mention generations of tradition,” said New Mexico Cattle Growers’ Association President Rex Wilson, Carrizozo. “No environmentalists’ family businesses or lifelong investments are at risk in this situation.” The WildEarth Guardians’ lawsuit claims that by allowing trapping of viable furbearer populations in the wolf recovery area, the NMDGF is allowing harm to the non-essential, experimental Mexican Grey Wolf, despite the fact that trapping the species is not allowed, Wilson explained. The federal reintroduction program for the Mexican Grey Wolf began in 1994.

“To date, millions of our tax dollars have been spent to reintroduce this predator, which is still struggling in the wild almost 20 years later,” said David Reese, United Sportsmen for Fish & Wildlife President, Belen. “The WildEarth Guardians are trying to use trapping as an excuse for the failure of the reintroduction program, which has been a monumental waste of time and resources since the beginning.” Rural southwestern New Mexico’s economy is based on ranching, hunting, guiding and outfitting, all of which would be threatened if the lawsuit was successful. “Ranchers must have the ability to protect their livestock to stay in business,” said Bebo Lee, New Mexico Federal Lands Council President, Alamogordo. “Dealing with wolves on their operations has been hard enough on these ranchers – it’s too much to ask that they sacrifice even more of their herds to other predators.” Hunting and trapping have a long history in New Mexico, as a

July 15, 2012 family tradition, as a tool for wildlife management and in many cases, a successful livelihood. Despite the impacts of the wolf reintroduction program to the deer and elk herds in the Gila National Forest, guiding and outfitting is a big business, with a big impact on rural counties. “The survival of our members’ businesses, and their ability to feed their families, depend on healthy wildlife populations, and that means balanced management which includes predator control,” said Marc Kincaid, New Mexico Wool Growers, Inc. President, Hope. “Aside from the potential financial impacts to our members and the small-town businesses they help support, it’s just irresponsible to put wildlife management in the hands of environmentalists and animal rights groups in Santa Fe whose only concerns are filing lawsuits and limiting land use.” “This lawsuit has the potential to alter science based game management everywhere. The suit is designed to take game management out of the hands of states and move it to the courts. WildEarth now chastises the

JBS to sue Greenpeace over deforestation report ■ Greenpeace

accuses JBS of violating agreement concerning cattle purchases from Amazon suppliers.

■ JBS

denies all charges and says it will seek damages for lost sales.

■ Brazilian

senator says farmers and ranchers working to protect rainforest.

by ROD SMITH, FEEDSTUFFS.com

BS S.A. has reported that it plans to begin legal proceedings against Greenpeace after the activist environmental group issued a report accusing the company of engaging in the deforestation of the Amazon biome, or rainforest. JBS said the report could adversely affect its sales but didn’t indicate what damages it might seek. The company denied all of the accusations. Greenpeace, in a report issued on June 6, charged that JBS, the largest beef processor in Brazil and the largest meat packer in the world, has violated a 2009 agreement by buying cattle from regions of the Amazon where cattle producers are grazing herds on deforested land and/or using workers who are in debtslavery conditions. Greenpeace said it drew its conclusions from its own field investigators and from reports by Ibama, Brazil’s environmental protection agency. However, JBS countered that a number of the ranchers cited by Greenpeace as damaging the Amazon biome were not blacklisted by Ibama at the time JBS purchased cattle from them and that other ranchers cited by Greenpeace are not blacklisted by Ibama or are not suppliers to JBS. The Greenpeace information “is false, incorrect, misleading and induces the public to draw erroneous conclusions,” JBS said. Because of this, JBS said it would use “all available legal channels to repair the damage (Greenpeace) caused to the company’s image through disclo-

sure of incorrect information.” JBS and three additional Brazilian meat packers signed a Greenpeace-brokered agreement three years ago that they would not source cattle from deforested land or from land reserved for indigenous people (Feedstuffs, Aug. 24, 2009). Major retailers, including Carrefour S.A. and Wal-Mart Stores Inc., were also parties to the agreement. Similar agreements have been negotiated in recent years with major soybean buyers and traders, including Archer Daniels Midland Inc., Cargill Inc. and Louis Dreyfus Commodities, not to buy soybeans that are grown on deforested Amazon land. Brazilian Sen. Katia Abreu, a leading member of the agricultural caucus and president of the Brazilian National Agriculture & Livestock Federation, said the country’s farmers and ranchers are cooperating in efforts to decrease rainforest destruction. She noted that in the most recent year where data is available (August 2010-July 2011), deforestation not only continued to slow but hit its lowest-ever annual level. JBS said it has more than 50 employees directly involved in sustainability activities, which include incentive programs to develop a sustainable beef supply system and satellite monitoring of the Amazon biome. JBS, headquartered in Sao Paulo, Brazil, is the third-largest beef processor and third-largest pork processor in the U.S. It recorded 2011 sales that totaled 61.8 billion reals ($34.1 billion).

New Mexico Game Department for using sportsmen’s dollars, not tax dollars, to defend New Mexicans and New Mexico’s wildlife against a frivolous lawsuit. In court documents they seek to deny participation of an international conservation group, the Safari Club International in the litigation process. It seems to be alright for the ‘guardians’ to squander millions of sportsmen’s and taxpayer dollars to advance their spiritual beliefs through court actions but, the very people that have paid the bills for wildlife recovery and management over the last century, can’t play in their ‘sand box’; how ludicrous is that?” asked Tom McDowell President NMTA, Corrales. “Western states are dealing with the devastating impacts of forests being managed by the courts and anticonsumptive use groups. New Mexico and Arizona saw the largest fires in history in 2011 and we just set two more records in the past few weeks. If WildEarth were to prevail with its current action, New Mexicans can say goodbye to their wildlife, too.”

Sierra Club Sets Anti-Trapping Policy U.S. SPORTSMEN’S ALLIANCE

n a May 19th written statement from the Sierra Club’s Board of Directors, the group has officially gone on record as opposing nearly any and all forms of trapping — period. The official statement concealed on the group’s website notes that: “The Sierra Club considers body-gripping, restraining and killing traps and snares to be ecologically indiscriminate and unnecessarily inhumane and therefore opposes their use.” Sierra Club, thought by many sportsmen to be no friend to hunting — and now an official and publically recognized anti-trapping group — says it supports “humane” methods of solving human and wildlife conflicts. No guidelines on their definition of “humane” were revealed. Oddly enough, the final sentence in the official statement notes that the Sierra Club recognizes the rights of indigenous people under federal law and treaties in the taking of wildlife. So is this, however, a nod in favor of trapping? Trapping is a widely accepted and vital method of reducing raccoons, beavers, muskrats and other species that prey on nesting songbirds, gobble up young waterfowl, destroy countless dollars of timber and crops each year in America, and basically wreak havoc on everything from highways to lakes. “For a group that’s concerned about the environment, the Sierra Club’s call to end trapping could lead to one of the most damaging conservation disasters in American history,” said Bud Pidgeon, president and CEO of the U.S. Sportsmen’s Alliance. “Trapping is accepted by and a necessary tool of wildlife professionals from coast to coast. But, this policy from the Sierra Club comes as no surprise to the vast majority of sportsmen and women.”

View the Sierra Club Board of Directors memo, go to http://www.sierraclub.org/policy/conservation/ TrappingWildlife.pdf

July 15, 2012

“America’s Favorite Livestock Newspaper”

Ranchers trump politicians, activists when it comes to cattle by JOE PARKER, JR., President, Texas and Southwestern Cattle Raisers Association

f history is any indicator, then we can be sure of one thing — when the government gets too involved, the problem usually gets worse. Flip through pages of history and you’ll see examples of this time and time again. Common sense tells us that we should learn from our mistakes, but unfortunately, that’s not always the case in Washington, D.C. Case in point — Sen. Dianne Feinstein from California and Rep. Kurt Schrader from Oregon recently introduced legislation that would federally dictate how eggs can be produced. S. 3239 and H.R. 3798, the Egg Products Inspection Act Amend-

A staffer at HSUS has gone as far to state that his “goal is the abolition of all animal agriculture." ments of 2012, would codify an agreement between the United Egg Producers and the Humane Society of the United States (HSUS) calling for federally mandated production practices in the poultry business. This is a slippery slope for all livestock producers, and a road better left untraveled. Here’s why. America’s farmers and ranchers are experts when it comes to taking care of their animals. Government bureaucrats are not. Neither are sneaky executives at HSUS. Many of them have never spent significant time on a working cattle ranch. Ranchers are experts on animal care because it’s our obligation. It’s the right thing to do and we know quality beef begins with quality care. This is why we work tirelessly to keep our livestock healthy, safe and secure. We take this commitment so seriously that we personally invest millions of our own dollars into programs like the Beef Quality Assurance program and the Cattle Industry’s Guidelines for the Care and Handling of Cattle. These programs and guidelines are designed by true experts including ranchers, veterinarians, animal scientists and animal care specialists with only the best interest of cattle in mind. Let’s dig deeper and look at the lobbyist group behind this legislation — HSUS. It’s no secret this group wants to eliminate all animal food production. A staffer at HSUS has gone as

far to state that his “goal is the abolition of all animal agriculture.” HSUS can’t make consumers stop eating beef, but they can raise millions of dollars under false pretenses and turn around and use that money to buy votes in Congress that hamstring the livestock industry. They do this with the hope that it will eventually become too burdensome and expensive for family ranches to stay in operation. The intention behind S. and H.R. 3798 is not to better protect livestock. If it were, the government would heed the advice of the World Organization of Animal Health when it acknowledged that mandated animal production practices are not in the best interest of promoting true animal welfare. They would work alongside ranchers rather than weigh them down with costly and unnecessary regulations. Passing this legislation as a stand-alone bill isn’t the only option HSUS is seeking. There

has been talk about including this as an amendment to the 2012 Farm Bill, or other ag-related bills that come through the House or Senate. They will do whatever it takes to see this legislation become law. Unfounded and irresponsible lawmaking like this could eventually disable ranchers like me from providing families, both at home and abroad, with a safe, abundant and healthy food supply. We simply cannot afford for that to happen. This is why it is so important for ranchers to band together through TSCRA. Together through a strong membership, we can help elect officials who understand and respect the beef industry and stop HSUS and other anti-agriculture groups from chipping away at the livestock industry one senseless regulation at a time. Joe Parker Jr. is a third generation rancher from Clay County, Texas. He is president of the Texas and Southwestern Cattle Raisers Association. He is also chairman of the board and president of the First National Bank of Byers.

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Riding Herd haven’t had a new photo taken for my column in three decades. I’m really older than dirt! I’m uncomfortable living in a world where eyes are everywhere. I can’t enjoy shopping because I know there are hidden cameras in the ceiling and I’m afraid they’ll catch me scratching myself, or showing my “bad side.” Which is pretty much every side of me. Mind you, I’m not doing anything illegal, I just don’t want my embarrassing moments captured for posterity on a security camera. I want my sights unseen. That’s one reason why I’ve become a hermit, hiding in the house so I won’t be caught on camera. I hope the big bald spot on the top of my head fries their cameras! The trouble I have with all this “eye in the sky” stuff is the same problem I have in spelling the name of the town where I’ve lived for 35 years. The small town is called Los Osos. Oh sure, I know all the letters just fine, but with all the O’s and S’s in a row sometimes I get carried away and don’t know when to stop. Neither will our government.

CONTINUED FROM PAGE ONE

One minute the EPA is spying on steers in North Platte and the next thing you know they’ll have a webcam in your television set watching you slice onions, or pet the dog in that secret spot that makes her leg jerk uncontrollably. Or they’ll have an army of Peeping Toms looking through your plate glass window. Don’t forget to smile and “Say Cheese.” I’m telling you, it won’t be long before the feds are using drones, which can be smaller than a baseball, to check on vegetable farmers to make sure their rows are straight, and satellite images will be used in court against a cowboy for roping a non-bovine beast. I hate the idea of knowing that some sick government geek with a joystick is watching on a bank of monitors every move we make. “Hey Joe, check out the bazooms on this nude sunbathing beauty in her backyard in Hollywood.” Or. “Mary, you should see this sicko with his arm up a cow’s rump in Amarillo.” You just know the FBI will take that preg-checking scene out of context.

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July 15, 2012

Sierra Club Hires EPA Official Felled by ‘Crucify’ Comments by AMY HARDER, www.nationaljournal.com

he Environmental Protection Agency official who recently resigned for saying the government should “crucify” bad actors in the energy industry will now be working for the Sierra Club to help its campaign against coal. The organization announced that it was hiring Al Armendariz, who resigned on April 30 as EPA regional administrator for Texas, Oklahoma, Arkansas, Louisiana, and New Mexico after an uproar over his comment that EPA’s “general philosophy” with its enforcement policy should be to “crucify” oil and natural-gas companies. “This is an exciting day for clean energy and public health supporters in Texas,” said Bruce Nilles, senior campaign director

for the Sierra Club’s “Beyond Coal” campaign, in a statement on recently. “Al has worked closely with the Sierra Club for many years, as an environmental scientist and professor. He understands the critical importance of developing clean energy to create jobs, protect people and protect air and water.” The hire will likely inflame an already heated debate among congressional Republicans, the Obama administration, and influential environmental groups like the Sierra Club. House Energy and Commerce Committee Republicans have recently lashed out at the Sierra Club — the country’s largest environmental group — for its intensified campaign seeking to wean the country off not only coal and oil, but natural gas, too. National Journal reported earlier this month that on the same

day Armendariz initially agreed to testify in front of a House Energy and Commerce subcommittee regarding his comments,

Armendariz made the “crucify” comments, speculated at that time that Armendariz’s visit to the Sierra Club was for a job

With such an impressive job-killing resume, it would be no surprise if the Sierra Club is recruiting him for their ‘Beyond Gas’ campaign designed to ‘prevent any new gas plants from being built’. he was at the Sierra Club’s Washington offices later that day. Armendariz abruptly canceled his plans to testify less than 24 hours before the hearing and did not provide the committee with a reason why, but he was still in town to meet with the environmental group. Senate Environment and Public Works ranking member James Inhofe, R-Okla., whose staff uncovered the 2010 video where

interview. “Rather than testifying in the House and being accountable for carrying out the ObamaEPA’s ‘crucify them’ agenda, it appears Mr. Armendariz may have had a job interview with the Sierra Club,” Inhofe said at the time. “With such an impressive job-killing resume, it would be no surprise if the Sierra Club is recruiting him for their ‘Beyond Gas’ campaign designed to ‘pre-

vent any new gas plants from being built’ and to end natural gas production in this country.” It appears as though Inhofe was right. Armendariz’s lawyer, Danny Onorato, did not respond to requests for comment at the time about why Armendariz was at the Sierra Club. Armendariz will be helping the Sierra Club with its “Beyond Coal” campaign, which was launched in 2002 in reaction to trends in the power market to build more than 150 new coalfired power plants. The campaign’s goal has been retirement of one-third of the nation’s more 500-plus coal plants by 2020. National Journal reported in May that the Sierra Club was doubling down on its efforts to combat new natural-gas production with a “Beyond Gas” campaign modeled after the “Beyond Coal” campaign.

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Many examples exist in nature. However, when man steps into the relationship, even for good reason (food, clothing and shelter) he upsets the cycle. He does it knowing there will be consequences. In rural communities where livestock live, we have learned how to handle the huge amounts of “animal waste” that are produced by our cattle and hogs. Farmers have been recycling since Adam discovered that fertilizing his garden made things grow better. It is part of the cycle of nature. This ‘spreading of manure’ is more difficult in urban housing developments or mall parking lots, but according to Thurman, my authority on the subject, one of his friends has taken on the touchy subject of dogs pooping in their neighbor’s yard. In defense of the dog, they are fully aware of the stigma attached to someone who is known for “pooping in his own backyard.” But we have desensitized them. After all, humans and cats now poop in the house! But . . . the neighbor doesn’t care about the dog’s stigma, or the natural cycle, or the benefit of dog poop (DP) fertilizer for Bermuda grass. He’s more concerned about hitting the hidden torpedoes with his lawn mower and spackling the side of his house! Neighbors’ dogs are a contentious subject. Enter Thurman’s friend who lives in a gated community where pets are allowed. He discovered a compa-

ny who will DNA-test every dog in the neighborhood. He introduced the idea to the community. It is now a rule that every dog owner inside the development must submit his canine for DNA identification. The idea being that when a homeowner spots a POP (poop on property), they call the PP (poop patrol) and report a drive-by pooping, officially called a PWP (pooping without permission). The PP arrives in the PPR (poop Prius) and, wearing a Hazmat suit, Playtex gloves and using a specially designed PPU (poop picker-upper), they select a specimen and place it in a PPC (plastic poop container) to take to the laboratory. The DNA is analyzed and compared to the DNA of canine residents, and the guilty owner is punished; $100 fine or two weeks community service on the PP, in the PPR, responding to PWPs and driving to the scene of the crime where the POP was reported. It seems to be working, despite the occasional bear, coyote, or raccoon drive-by NDP (not dog poop) sighting. I suggested that maybe this technique could be used on other species. “Too expensive for cows,” said Thurman, “And, thanks to the Insane (humane) Society of the U.S. and their “unintended consequences,” the last thing those thousands of citizens abandoning their horses in parks and on farms want . . . is to be identified as the owner! They prefer to think they are recycling!

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Hard to define, easy to taste Pleasing consumers key to premium beef, audit says by LAURA NELSON, Certified Angus Beef, LLC

ating satisfaction rules when it comes to making beef lovers happy. That was clear in early results from the 2011 National Beef Quality Audit (NBQA), but defining that satisfaction seemed harder to pinpoint. “If producers get the right signal, and they are pretty good managers, they can hit the target,” said Keith Belk, Colorado State University meat scientist. “But they have to have the right signal.” One constant beacon comes from the Q-word in that audit, which has run every five years since 1991: people at every link in the beef chain want quality. A call for more Prime and premium Choice beef rang out, with the target-consumer consensus suggesting 5 percent and 31 percent, respectively. Actual production levels for all beef in those categories during 2011 was 2 percent and 20 percent, 14 points short of expectations. Science has proven marbling at those levels brings increased eating satisfaction, so it’s no surprise that the NBQA showed consumers want more of that beef. The audit format asks customers who buy feeder calves, fed cattle, beef carcasses, subprimals and variety meats to define seven quality attributes. Those included food safety, eating satisfaction, cattle genetics, visual characteristics, how and where cattle were raised, lean, fat, weight and size. Once ranked, the survey burrowed deeper into the meaning and value of each. On the production end, feeders, packers and allied industry ranked “tenderness” as the top definition for eating satisfaction, followed by “good beef flavor.” Respondents in the foodservice and retail industries had it just the other way around. “We need to continue striving toward improving eating satisfaction, and there will be an emphasis on flavor there,” Belk said. “Flavor has pulled to the top; once you have satisfactory tenderness, then flavor is all of a sudden elevated in its relative importance.” In foodservice, 63 percent of respondents favored flavor as their definition, while 52 percent said tenderness and 29 percent called it customer satisfaction. “This was the first year that we saw flavor mentioned more importantly than tenderness,” said Deb VanOverbeke, Oklahoma State University animal scientist. “Flavor really was emphasized by the end users, but it is still defined differently among those who are buying live cattle.” All NBQA respondents were purchasers of live animals or beef

product, and VanOverbeke said that divide reflects their views on the resale value of each quality term. In this era of branded beef programs that reward higher quality and consumer-based targets, performance further down the chain has become more valuable. “They are looking at where to filter the product in once it is in their system,” she said, “trying to determine how to best spend and best capture each dollar.” The terms by which eating satisfaction was defined may have differed among the segments, but their pursuit of that dollar never wavered. A new aspect of the study brought to light beef buyers’ willingness to pay for the traits they found most important. While only 2 percent of those who purchase live cattle said that eating satisfaction was a requirement they must have in order to buy, nearly half of them said they’d pay a premium of 11.4 percent to guarantee that quality. That premium level ranked No. 1 in the amount packers and feeders said they would pay above base price to guarantee any quality attribute. VanOverbeke said readiness to pay that premium on the liveanimal side may correlate to another term the NBQA worked to define: cattle genetics. Packers, feeders, retailers and foodservice professionals defined “cattle genetics” for quality as a predominantly black hide. Four out of five listed “genetic potential for marbling” as their second-ranked term. Those definitions likely pertained to feeders who are supplying branded beef programs, she explained: “If they know what those genetics are going to get them, they might pay a premium for those cattle because of how they typically perform.” More than 20 percent of respondents closest to end users said “eating satisfaction” was an absolute requirement for purchasing. That quality had the highest share (47 percent) of respondents willing to pay extra as well — about 11 percent more — to guarantee it. Belk said taking a wholeindustry perspective from the survey illuminates a clear path the success: “If you align a supply chain that addresses a specific consumer target and has specific process control all the way up and down the chain to address that target, then the whole system is more profitable.” VanOverbeke agreed the bottom line comes down to tying all those surveyed industry segments together: “If you know who your customer is and you know what they are looking for, you are more likely to target some premiums that you might be able to earn by doing a few things differently.”

Page 7

History holds sustainability lesson by NEVIL C. SPEER, PhD, MBA, Feedstuffs Foodlink

turned to my family and said, “That’s precisely the point!” By chance I had stumbled across the perfect contrast for our time. But I’m getting ahead of myself — let me back up a few days. It all began with an email I received as part of a list-serve subscription. The message originated from a university professor looking for feedback regarding efforts to develop a new program of study for students interested in agriculture — all part of a larger initiative around the concept of sustainability. The overarching objective of the new program is an endeavor to “. . . promote agriculture at a human-scale, that is, agriculture that provides meaningful work for people, is localized enough for those involved to understand and witness the feedback loops and that is resilient (in face of looming uncertainty ecologically and economically).” Specifically, the project would require new curriculum. And so the email was requesting input regarding what types of courses and/or material should be included to support such a mission. However, from my perspective, that’s the wrong place to begin. It’s always interesting to me how the concept of sustainability can be invoked without any real tough questions as to the premise or context in which it’s being used. The term has gotten overworked and inherently evokes the concept of political correctness. So whatever agenda you might have, now you can just hitch your wagon to the term “sustainability” and it’s fairly easy to find some traction. What about the premise? That’s especially important when “sustainability” gets leveraged as an indictment against agriculture. Case-inpoint, the professor’s email also included a question about what to call the new degree. The initial proposal was “Agricultural Arts” with the explanation that such a title would “. . . emphasize the artistic, humane and small-scale practice of agriculture.” That premise is full of preconceived notions about agriculture. It’s pretty clear such a degree program would emphasize ideology versus

exploration, critical thinking and problem solving. That type of ideology is reflective of a presumptuous and narrow view of both agriculture and sustainability. (That’s especially troubling when it’s espoused by individuals at institutions of higher education.) Plus, it overlooks the complexities involved in studying the issues and advancing solutions. That very point was noted from the International Journal of Agricultural Sustainability: “Vital work needs to be done to establish more precisely what ‘sustainable food’ represents, and to identify best practice standards across a wide range of activities throughout the [food supply chain].” In other words, as I’ve written previously, sustainability invokes more questions than answers. With all that in mind, let’s circle back around to my initial story. Several days after the email, while on vacation, my family and I visited the New Mexico History Museum. On the bottom floor, on the wall directly across from the landing of the stairs there was the following quotation: “The first winter of 1933 was definitely the hardest one . . . Our diet was red beans and corn bread for lunch and supper and watery gravy and biscuits for breakfast.” Think about it — not even 80 years ago, U.S. citizens were facing regular challenges in terms of obtaining balanced diets — not to mention struggling with culinary monotony. We’ve come a long ways in such a short period of time. The contrast between then and now is striking. We’re blessed by incredible abundance and variety. Without that particular luxury, I doubt we’d spend much time worrying about, or devote much effort to, the “artistic practice of agriculture.” That said, perhaps we should spend more time remembering about whence we came — after all, those who ignore history are doomed to repeat it. Dr. Nevil C. Speer is with Western Kentucky University and serves on the board of the National Institute for Animal Agriculture, a national organization devoted to engaging livestock producers and livestock health professionals in developing solutions for issues in the livestock industry.

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Page 8

Tim Starks brings fresh perspective as new president of the LMA he Livestock Marketing Assoc. (LMA) is pleased to announce Tim Starks as President for the 20122014 term. Unlike many past presidents, Starks did not grow up in thelivestock auction marketing business. Starks grew up on a farm and ranch operation near Cherokee, Okla., where for 30 years he was a customer of thelocal auction markets. After graduating from Oklahoma State University (OSU) with a degree in agricultural economics in 1989, he pursued a degree in veterinary medicine, which he

received from OSU in 1992. Following graduation, Starks returned home and purchased a veterinary practice next to the local livestock market in Cherokee. He and his wife, Jennifer, began a family and raised two children of their own, Garrett and Macy. Over the years, they have been foster parents to numerous children, and recently adopted an eighteen-month-old boy. Soon after beginning his veterinary practice, Starks was hired as a veterinarian at the auction market on sale days, while he continued to run his private clin-

Europe’s green energy suicide s austerity bites into European living standards, sparking revolt at the “growth” has polls, become the politician’s mantra. But to be competitive, European countries require a secure, plentiful and competitively priced energy supply. Unless Europe radically rethinks its obsession with carbon dioxide emissions and the anti-fossil fuel energy policies that flow from it, growth is likely to remain elusive, says author Rael Jean Isaac in the Wall Street Journal. Lawmakers across the continent would do well to take to heart the conclusion of the European Commission Energy Department’s Energy Roadmap for 2050, which stated frankly that “there is a trade-off between climate change policies and competitiveness.” ■ European Union law mandates that the 27 member coun-

tries on average cut their carbon dioxide emissions 20 percent by 2020, compared to 1990 levels. ■ The goal after that is to cut emissions by between 80 percent and 95 percent by 2050. ■ In May 2010, a study by the European Commission's energy department estimated the 20 percent cut would cost 48 billion euros ($66.3 billion) a year. Individual nations’ energy policies are pushing for further cuts in emissions, wreaking havoc on the economies that once dominated the continent. ■ In the United Kingdom, a generous system of subsidies for renewable energy was found to have cost 10,000 jobs between 2009 and 2010 alone, and is estimated to raise the energy cost of vital industries (steel making, ceramics, paper, etc.) by 141 percent by 2020. ■ Spain’s experience with subsidizing renewables has been

ic. Over time, Starks built a veterinary consulting business focusing on stocker and feedlot operations, and closed the clinic in1997 to consult full time. In 1998, he purchased the livestock auction market in Cherokee and added market management to his resume. He currently owns and operates Cherokee Sales Co., LLC with partner Randy Patterson, as well as continuing to practice veterinary medicine in his consulting business. With the many challenges facing animal agriculture from a public far-removed from farm life and painful, with a 2009 study at Universidad Rey Juan Carlos finding that the subsidies had led to a loss of 110,500 jobs. ■ Italy’s subsidy system, which sets the price floor for wind energy at three times the market level, was found to sacrifice 6.9 industry jobs for every green job it created, according to a study at Italy’s Instituto Bruno Leoni. ■ Germany’s Renewable Energy Feed-in Act of 2000 requires electric utilities to buy renewables from all producers at fixed, exorbitant rates and feed it into the power grid for 20 years, raising rates and undermining industrial competitiveness. ■ Even France, which has remained relatively immune to energy problems because of its enormous nuclear energy capacity, is beginning to move away from that clean energy source that has served it so well. Source: Rael Jean Isaac, “Europe’s Green Energy Suicide,” Wall Street Journal, June 5, 2012.

The Best of the Bunch

July 15, 2012 the source of the food they consume everyday, Starks said, What we need to do now is sell ourselves to the other 98.5 percent of the world that doesn’t understand what we do.” With his animal health perspective, Starks will lead the association in its objective to be the “gold standard” in animal handling and care. Starks was installed at the 2012 LMA Meeting held in Annual Modesto, in June. He will lead the following board members in

The EPA’s flawed zero tolerance policy or the last three years, the Environmental Protection Agency (EPA) has justified new air quality regulations — unprecedented in stringency and cost — on the assumption that even trace levels of particulate matter can cause early death. The EPA’s guiding principle in this effort has been that there is no price too high to preempt further particulate reduction, says Kathleen Hartnett White, a senior fellow at the Texas Public Policy Foundation. The EPA has gone so far in this endeavor as to claim that its rules will save 230,000 lives by 2020. However, such rhetoric is built on implausible assumptions, biased models, statistical manipulations and cherry-picked studies. ■ The EPA emphasizes the killing potential of airborne particulate matter, yet physicians and toxicologists have found little evidence of this drastic conclusion. ■ The EPA’s zero-tolerance principle for health risks compels it to herculean regulatory ends, including reducing particular matter below levels found in nature. ■ Natural background levels of 1 microgram of fine particulate matter per cubic meter will logically become the next target

Nitrates

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the coming year: Vice President Dan Harris, Holton, Kan.; Chairman David Macedo, Tulare, Calif.; Jerry Etheredge, Linden, Ala.; E.H. Fowler, Sedalia, Mo.; Wayne Geistweidt,Fredericksburg, Texas; T. Phil Harvey, Jackson, Ga.; Dwayne Mays, Ogallala, Neb.; Clay Myers, Texhoma, Okla.; Sam Roberts,Columbus, Ohio; Charlie Rogers, Clovis, N.M.; Jim Santomaso, Sterling, Colo.; and Bobby Smith, Fairview,Okla.

asked Kallenbach about corn being chopped and fed to cow herds. That is being done already in dry areas of southern Missouri. “That works well — if it is done quickly,” Kallenbach said. The worst thing is to chop a load of cornstalks, then let the forage sit on the feed wagon overnight. In that time, the deadly nitrates convert into even deadlier nitrites. “If you feed a load of highnitrite corn to your cattle in the morning, by noon you can be out of the cattle business. The cows put their four feet into the air,” he added. Nitrites tie up the oxygencarrying capacity of blood hemoglobin. Without oxygen, the cow suffocates. At even low levels of nitrate, pregnant cows can lose their calves. Grazing drought-stressed cornstalks is safer than chopping, if managed right. Cows

for the EPA. The EPA’s claimed mandate places it on a losing path; particulate matter realistically cannot be reduced below certain ambient levels. Nevertheless, its rules will impose enormous cost on the economy in an ill-advised effort to accomplish exactly this. ■ Indoor levels of fine particulates are far higher than outside levels. ■ Simple tasks such as cleaning a closet and cooking expose individuals to high levels of particulate matter that cannot be reduced by regulation. ■ Nevertheless, the EPA will continue to make a show of targeting particulates under the guise of fulfilling the directives of the Clean Air Act. Interestingly, the national standard for acceptable particulate matter concentration remains at 15 micrograms per cubic meter. Were the EPA truly so convinced of the rightness of its conclusions, one would think it would be quick to revise this standard. The fact that it hasn’t suggests that EPA regulators are well aware of the fallibility of their claims. Source: Kathleen Hartnett White, “The EPA’s Flawed Zero Tolerance Policy,” Daily Caller, June 4, 2012.

continued from page one

prefer eating corn leaves first. Usually, leaves have less nitrate content than stalks. Management-intensive grazing works when a strip of a cornfield is fenced off with an electric wire. When the herd eats all of the leaves, but before they start eating nitrate-rich cornstalks, the cows are moved to a new grazing paddock. Even after rains come, the water won’t clear up problems overnight. It takes the plant at least five days to convert nitrate to safer levels of amino acids. If there are no ears of corn on the standing stalks, conversion takes longer. When cattle run out of pasture, farmers turn to alternative forages, Kallenbach said. Slow down and make a quick nitrate test to ensure safety of the herd. It is so long between severe droughts that people forget lessons learned in the last drought.

“America’s Favorite Livestock Newspaper”

July 15, 2012

he ancient Greeks used to debate what people know and HOW they know it. Deeply held convictions have wrestled with science-based knowledge ever since. And eventually, economics entered in, usually linked to science, if only the qualitative data on what people do with their perceptions. You may know something because it is stated by a source you consider reliable, even infallible. You could know it because you’re confident of your interpretation of the data about it. Or you might feel the truth of something “in your soul,” as if your own perceptions are infallible; then you look for bits of science to support your beliefs. That range is found everywhere from the ranch to the food consumer. Fans of certain “food philosophy” writers elevate authors to authorities because persuasive prose rings true for them. With enough disposable income, they may even pay more for food that fits their gastronomical belief system. Consumers write the checks that pay our way in the beef industry, but you have to wonder how they know how beef cattle should be raised. Perceptions can be spot-on, but they can also be arbitrary and out of touch. Consumers several generations removed from the farm may think the

Perceptions, science and business scale required to make a living in agriculture is just wrong. Hundreds of cattle in a herd rather than six or eight? Trying to make a profit? That can’t be good. Some beef producers choose to cater to the various niche markets these ideas spawn, as an example of business meeting perception-based opportunity. There’s often less risk in catering to science-based opportunities. Stories about the beef and producers are increasingly important in marketing. But just telling banquet guests a story about the beef won’t improve its flavor unless that beef was selected based on meat science to please consumers. Many consumers “know” all fat is bad, even though science has discovered there is good fat (beef marbling) and bad fat (generally external and trimmed

off the beef). On the producer side, some focus on genetics that deliver the good fat, but others see it as a fad or the cattle feeder’s concern. Because of one brand’s success, some consumers form a positive impression of all beef linked to a breed. Yet science says that ability to please consumers has more to do with the specifications than the breed, or rather that breed can provide all the attributes and tools required to hit those specs. Science may trump perception, but business must consider both, along with practicality in labor costs. Investing too much in a fad can be a mistake if perceptions shift, but always going with science can take you down a different road to ruin. Your well-informed perceptions must guide your decisions. If science can add 30 pounds of beef at the expense of consumer satisfaction, it is worth it? The industry may never know what it lost. Is it worth it to follow the recipe for crossbreeding to capture the scientifically proven (infallible?) 4 percent advantage in commodity beef production? Or can you make up for it with the simplicity, greater predictability and genetic focus found in one breed? Ultimately, in the long run, the consumer will decide.

Farm Credit of New Mexico members elect board members he stockholders of Farm Credit of New Mexico have casted their ballots and the election results are in: Incumbent Allen “Wess” Wells has been re-elected to the Board of Directors. Aubrey L. Dunn Jr. and Tyson “Buddy” Achen, Jr. have been elected to serve their first terms on the Board of Directors. Allen “Wess” Wells has been re-elected to the Northwest region. Wells is married to Kim and they have four children. They reside in Mountainair, New Mexico. Wells is a graduate of Eastern New Mexico University. He is current Chairman of the Board, Member and Director of Farm Credit of New Mexico, ACA, and a Director of Farm Credit Foundations. Wells is owner and operator of a cow/calf, yearling ranch at Gran Quivira. He is also owner of Wells Insurance Agency along with wife Kim. Offices are located in Moriarty and Mountainair. Wells is involved with many groups including: New Mexico Cattle Growers’ Association, New Mexico Farm and Livestock Bureau, Estancia Valley Economic Development Association, Estancia Basin Resource Association, the Gran Quivira Church Board, and an Advisor of the Tumbleweed 4-H Club. Past affiliations include Member of the Mountainair Board of Education, the Moriarty Rotary Club, and the Torrance County Fair Board. Aubrey L. Dunn Jr. has been elected to the Southeast region. He is married to Robin and they have three children and one granddaughter. They reside in Lincoln County, NM. Dunn is a graduate of Colorado State University. He is currently a Member of Farm Credit of New Mexico, ACA, and a past loan officer with Monte Vista, PCA. Dunn is owner and operator of a 40-section ranch in southeast New Mexico, and runs a

cow/calf operation. He has been a banker for twenty-five years having started his career with Production Credit Association as a Crop Inspector and the last ten years as President and CEO of First Federal Bank. Dunn has been active in his communities and is presently Vice Chairman of Chaves County Soil and Water District and New Mexico Coalition of Conservation Districts, and a Member of New Mexico Cattle Growers’ Association and New Mexico Farm and Livestock Bureau. Past affiliations include Chairman of the Otero County Fair Board, Board Member of the Alamogordo Chamber of Commerce, the Roswell Chamber of Commerce, the Otero County Economic Development, a Member of Alamogordo Rotary Club, Roswell Rotary Club, Board Member of the New Mexico Bankers Association and New Mexico School of Banking. Tyson “Buddy” Achen, Jr. has been elected to the Southwest region. He is married to Kathy and they have three children. They reside in Las Cruces, NM. Achen is a graduate of New Mexico State University. He is a Member of Farm Credit of New Mexico, ACA and past Member of Farm Credit Bank of Texas. Achen is owner and operator of a 700-acre pecan farm. He also owns a hardware business which sells farm equipment. In addition he owns and rents apartments. Achen is owner of Triple A Farms, AAA Holdings, Sun Valley Inc., Achen Enterprises, and TBC. He is also Treasurer of the Western Pecan Growers Association; Vice President of the New Mexico Pecan Growers; and a Board Member of Farm Bureau. Wells, Dunn and Achen will serve on the Board of Directors along with: Gary Good, David Salopek, Joe Clavel, Mike Marley, Tom Drake, Ben Haines, and Hilaire Mowduk.

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Moffat County, Colo. Commission to seek legal counsel over Department of Interior rules WWW.CRAIGDAILYPRESS.COM

he Moffat County, Colo. Commission will begin exploring legal options for a potential lawsuit against the U.S. Department of the Interior. The decision was unanimously approved by commissioners following a recommendation by the Moffat County Land Use Board to challenge certain federal regulations on wild and scenic river designations, recognition of revised statute 2477 roads on federal lands, and a ban on energy exploration in Vermillion Basin. Although the regulations are in the Bureau of Land Management’s Little Snake Field Office’s recently approved record of decision, a potential lawsuit would be filed against the U.S. Department of the Interior and not directly at the BLM’s local office. “I’ve been to all but one of the land use board meetings in the last seven and a half years, where these issues were thoroughly vetted,” commissioner Tom Gray said. “I think we’ve done that and followed the appropriate process.” Six members of the land use board attended a recent commission meeting to vent their frustrations about compromises reached with local BLM officials being ignored at the federal level. The 1-percent energy exploration exemption in Vermillion Basin, which the Department of the Interior later struck down in its decision to ban all drilling, was highlighted as an example. “The BLM was an integral part of all the meetings I attended and we thought the federal government was having their say so, and everyone was operating in good faith,” land use board member Dean Gent said. “We don’t have to talk about what’s going on now, but it’s the (federal government) trying to undo everything the local people did is what it amounts to, and I don’t think we need to sit here and take it.” John Kinkaid, a Moffat County resident and commission candidate in District 1, cited a recent U.S. Supreme Court ruling in his support of the county taking legal action. The case pertained to an Idaho family that filed suit against the Environmental Protection Agency, which was trying to use a wetlands designation to prohibit the family from building a lake home. The court sided with the family. Dave DeRose, a Moffat County resident and Kinkaid’s opponent for District 1, also commented on the court case. “This couple that fought the federal government did so as a principle issue because it certainly wasn’t a financially-wise issue as I’m sure it almost bankrupted them,” DeRose said. “We may become the couple from Idaho that battles the federal government on this issue and I’m fine with that. I support what these land use board guys are telling you.” Wendy Reynolds, field manager for the BLM’s Little Snake Field Office, also attended the meeting with colleague Tim Wilson. “I wanted to hear the viewpoint of the land use board and get a better understanding of how you folks feel, but not debate any of these issues because that boat has come and gone,” Reynolds said. “I would tell you that what you feel is what you believe and you need to do what’s right for you.”

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Over-regulation is pricey conomic reports show that job growth in federal regulatory agencies has far outpaced the growth of traditional occupations, says Deroy Murdock, a media fellow with the Hoover Institution. Crucially, these regulators propose rules and fees that have a stifling effect on the economy as a whole. Businesses spend enormous time and effort in code compliance efforts, and the costs of such compliance attempts often preclude additional hiring or investment. ■ The ranks of these employees have swelled during the current administration by 5.5 percent from 1,289,000 to 1,360,000. ■ While many of these federal employees do not regulate, per se, 291,676 of them do, up 17 percent under Obama. ■ Researchers at Engage America have calculated that federal red tape has squelched at least 779,203 potential jobs from the economy. ■ If these positions were filled, today’s unemployment rate would fall from 8.2 percent to 7.7 percent. ■ Citing a Small Business Administration study, Clyde Wayne Crews of the Competitive Enterprise Institute explains that complying with these regulators cost the U.S. economy $1.75 trillion in 2008.

Notably, not all regulations are bad, nor are all regulators bent solely on the constriction of the labor market. Many are important for guaranteeing the public safety or for checking the growth of economic activities with significant negative externalities. Yet the rapid growth of the power of regulatory agencies and the rules they produce suggest that the regulatory environment is out of control. ■ Regulatory officials imposed 3,807 new rules in 2011, or 15 every federal business day. ■ These new regulations filled 81,247 mind-numbing pages in last year’s Federal Register. ■ The resulting, incredibly complex, legal atmosphere creates victims where they need not occur: Salt Lake City’s Davis High School, for example, was fined $15,000 for forgetting to unplug a soft drink vending machine in its bookstore. Continuing regulations, such as “Conservation Standards for Wine Chillers and Miscellaneous Refrigeration Products” and “Efficiency Standards for Microwave Ovens (Standby and Off Mode),” should be greeted with greater skepticism. Regulators should question just how much their 15 new rules per day are truly serving the interests of the people. Source: Deroy Murdock, “Over-Regulation Is Pricey,” National Review, June 5, 2012.

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“Kroger’s has taken a very important step for animal welfare in declaring that the pork industry must find an exit strategy for its use of gestation crates,”

This evoked reactions from the National Pork Producers Council and the National Pork Board over the feasibility and economic viability of changing sow housing infrastructure over a specific time

McDonald’s set a 10-year timeline for sourcing all of its pork from farms that do not use individual stalls to house pregnant pigs. said Wayne Pacelle, president and CEO of the Humane Society of the United States. HSUS has been actively leaning on food service and retail companies that purchase pork to urge their suppliers to change their sow housing infrastructure.

Pork industry concerned While Kroger did not put a specific timeline on its request and acknowledged the transition could take many years, McDonald’s set a 10-year timeline for sourcing all of its pork from farms that do not use individual stalls to house pregnant pigs.

period. The groups also repeated their conviction based on peerreviewed research that gestations stalls are an acceptable animal husbandry practice. “We fully support continuing to explore new and better ways to protect pregnant sows,” said NPB president Everett Forkner in a statement last week. “Farmers are adopting improvements all the time as they study their farms and their animals. Going backward, though, will just put a huge financial burden on smaller pig farmers while doing nothing to improve the health and wellbeing of our pigs.”

The unemployment crisis for younger workers recent Government Accountability Office (GAO) report recommends that Congress take action to alleviate the pain of the recession that is felt by America’s oldest workers. Within the recommendation, the GAO offers several policies to accomplish this objective, including subsidies to employers who hire older workers, training programs for older workers and compensation for older workers who accept lower-paying jobs, says Diana Furchtgott-Roth, a senior fellow at the Manhattan Institute. This excessive concern offers relief to a portion of the population that has felt the least pain in the recent downturn. If assistance must be offered to a specific classification of workers, it is the youngest who are most in need. ■ Since 2000 the labor force participation rates of workers age 55 and over have been rising steadily, whereas the labor force participation rates of workers 16 to 24 years old and workers 25 to 54 years old have been declining. ■ The biggest decline in labor force participation rates can be observed for workers aged 16 to 24. ■ Over the past 10 years employment has increased among Americans age 55 and over by 8.9 million. ■ At the same time, it has

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declined by 3.1 million in the 25 to 54 age group, and by 313,000 among those aged 20 to 24. ■ The labor force participation rate of seniors has increased by 5.7 percentage points from 2002 to 2011, yet declined in other age groups. Furthermore, the long-term prospects of younger workers are far bleaker than those of their older counterparts. ■ A new paper in American Economic Journal: Applied Economics found that graduating in a recession leads to earnings losses that last for 10 years after graduation. ■ Researchers also found that earnings losses are greater for new entrants to the labor force than for existing workers, who might see smaller raises, but who have jobs. ■ In addition, recessions lead workers (especially younger workers) to accept employment in small firms that pay lower salaries. Finally, younger workers tend to have larger debts and fewer assets than older workers. Young homeowners tend to buy their houses during the buildup to the housing bubble, subsequently witnessing a bottoming out of their home value. Older workers who have owned their homes longer were more protected from the bubble. Source: Diana Furchtgott-Roth, “The Unemployment Crisis for Younger Workers,” Manhattan Institute, May 2012.

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American Agri-Women connect with policy makers in D.C. Deadline Passes for Appealing Ninth he Annual AAW Symposium: “Sustainable Development — the Impact on Agriculture” was held at the National Press Club and covered issues relating to the Agenda 21 impacts on American Agriculture. Visits to the Russian Embassy and Brazil Embassy gave members the opportunity to exchange in diplomatic relations. AAW members were provided briefings on Animal Welfare issues; Immigration legislation and problems facing the cattle industry. Pulitzer Prize recipient, Gretchen Morgenson, reporter with the New York Times and author of Reckless Abandonment was the guest lecturer at the Allan P. Kirby Center for Constitutional Studies. Her topic “Absence of Accountability”

highlighted how “Taxpayers are asked to bail out reckless companies who have not been held accountable for their dealings.” Every member took the opportunity to engage in a lively discussion regarding farm child labor with Department of Labor representatives Melvina Ford, Senior Policy Advisor Wage and Hour Division and Nikki McKinny. Each member present took a moment to articulate how the family farm is a safe, productive learning environment where children of family members and others interested in agriculture can begin training to ensure a thriving and educated agricultural workforce for the next generation. AAW also brought their 2012 policy positions to their Con-

gressional Representatives and Senators on the Hill. The priority issues included the 2012 Farm Bill; Estate Taxation; Immigration Reform and Ag Labor Shortages; and Land and Water Conservation Act. Over 200 guests attended the AAW Congressional Reception in House Agriculture Committee Room on Wednesday evening. This year’s “Champions of Agriculture” recognitions were awarded to Senator Debbie Stabenow, (D-MI) and Representative Cynthia Lummis, (R-WY). AAW President, Karen Yost said, “These outstanding individuals have dedicated themselves to uniting members in congress to ensure that legislation supports the integrity of American food and fiber production.”

College aid is corporate welfare midst the debate over whether a temporary 3.4 percent interest rate on federal student loans passed in 2007 should be retained and, if so, how to pay for it, a far more important question has been ignored: who really benefits from the $65 billion-plus that Washington spends each year on student aid, says Andrew G. Biggs, a resident scholar at the American Enterprise Institute. Recent economic research suggests that colleges siphon off a significant portion of federal education aid rather than lowering costs to students. This is first accomplished by colleges raising institutional tuition in response to their students being eligible for federal assistance. ■ As the College Board reports, from 2001 through 2011 tuition for public colleges increased by an average of 5.6 percentage points higher than inflation. ■ Additionally, private college tuitions rose 2.6 percent above inflation over the same period. ■ Tuition, housing and other expenses at public institutions today tops $21,000 per year, while the figure for private colleges is roughly double that. ■ In response to rising tuition costs, federal aid such as Pell Grants, work-study programs and tuition tax credits have more than tripled over the last decade, reaching $65 billion in 2011.

Washington also made over $100 billion in subsidized student loans last year. ■ Stephanie Riegg Cellini of George Washington University and Claudia Goldin of Harvard University found a 75 percent difference in tuition between aid-eligible and ineligible for-profit colleges. ■ This suggests that colleges that are eligible for aid respond by raising tuition. Furthermore, there remain numerous other ways in which colleges can take advantage of federally provided aid that are subtler. For example, research shows that colleges respond to aid eligibility by reducing their own aid provided to students. ■ Nicholas Turner, a Treasury Department economist, analyzed colleges’ responses to student eligibility for tuition tax credits. ■ Turner found that roughly four-fifths of the benefit students receive from tuition tax credits is lost through reduced student aid provided by colleges. ■ Similarly, Lesley J. Turner, a doctoral candidate in economics at Columbia University, found that institutions managed to capture 16 percent of all Pell Grant aid — and that this figure rises to 79 percent for selective private colleges. ■

Source: Andrew G. Biggs, “The Truth about College Aid: It’s Corporate Welfare,” The Atlantic, May 21, 2012.

Larry Mitchell to head GIPSA griculture Secretary Tom Vilsack has named Lawrence “Larry” Mitchell, the former CEO of the American Corn Growers’ Association, as administrator of the Agriculture Department’s Grain Inspection, Packers and Stockyards Administration, a USDA source told The Hagstrom Report. Mitchell succeeds J. Dudley Butler, the controversial lawyer who resigned after the Obama administration weakened the rewrite of the rule governing the Packers and Stockyards Act. Mitchell has been a political appointee in the Obama administration as associate director of the USDA Office of Advocacy and Outreach. He was deputy administrator for farm programs at the Farm Service Agency from 1997 to

2001 during the Clinton administration. He also served President Bill Clinton as legislative liaison while overseeing the Office of Public Affairs and the Office of the Executive Secretariat. Mitchell is a fifth-generation farmer from north Texas, where he raised grains, cotton, hay, horses and cattle before starting to work in Washington in 1989. In the private sector, Mitchell served as president of K Street Research as well as CEO of the American Corn Growers’ Association. Earlier he was vice president for government relations for the National Farmers Union and, as an independent consultant and writer on American farm issues, director of federal and state relations for the American Agriculture Movement and editor of the AAM Reporter.

Circuit Wolf Ruling, Litigation Ends he Ninth Circuit Court of Appeals in March affirmed the constitutionality of Congress’ removal of wolves from the federal endangered species list. The deadline to appeal that decision passed quietly this week with no action from plaintiff animal rights and anti-hunting groups. Attorneys representing the Rocky Mountain Elk Foundation say the no-action means the case will not advance to the U.S. Supreme Court, and that the litigation has ended in favor of science-based, state-regulated management and control of wolves. “A lawsuit that began in 2011 in Judge Donald Molloy’s courtroom in Missoula, Mont., following the Congressional delisting, is finally over — and conservation has prevailed,” said David

Allen, RMEF president and CEO. “No appeals paperwork had been filed by end of the day on June 12, so the Ninth Circuit’s decision is absolutely final.” Allen said RMEF applauds the development because it helps clear the way for continued work to balance wolf populations with other wildlife and human needs. representing Attorneys RMEF and other conservation groups in the Ninth Circuit hearing had presented oral arguments supporting the Congressional action, wolf delisting and science-based, state-regulated management and control of wolf populations. RMEF has pledged to continue to fight wolf lawsuits and support delisting legislation at both federal and state levels.

How much does the federal government owe? he growing government debts of countries across the globe continue to dominate headlines. The United States’ publicly held debt is expected to exceed 70 percent of gross domestic product (GDP) this year. ■ 2011, the federal government said it owed $10.2 trillion in public debt, accrued federal employee pension and other retirement benefits of $5.8 trillion, and other federal liabilities of $1.5 trillion, for a total of $17.5 trillion. ■ However, Social Security and Medicare benefits payable to current retirees are not included as liabilities on federal balance sheets, though these two programs currently account for over one-third of federal spending — approximately $12.8 trillion. ■ The public debt plus benefits payable to federal workers and the accrued Social Security and Medicare benefits payable to retirees total $30.3 trillion. The $30.3 trillion, however, only accounts for accrued benefits and does not include the

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obligations that are expected to arise in coming years; including these obligations results in a much higher number. Indeed, in 2011, a conservative estimate of these amounts totaled $84 trillion – more than four times what the federal government admits it owes ($17.5 trillion). We could try to meet these obligations by raising taxes. But how much of the economy can the government claim in taxes each year without adversely affecting GDP growth? ■ The funding shortfall is 5.7 percent of the present value of all future GDP. ■ This implies that in the long run the federal government will need to increase taxes from its previous 50-year average of 18 percent of GDP to 24 percent of GDP or a tax increase of 30 percent. The growth of the economy will slow as a result, making it more difficult to meet the federal government’s unfunded obligations. Source: Liqun Liu, Andrew J. Rettenmaier and Thomas R. Saving, “How Much Does the Federal Government Owe?” National Center for Policy Analysis, June 13, 2012.

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The history of Farm Bill spending Washington’s Ten Thousand Commandments he farm bill comes up for renewal every five years, and its specific provisions determine whether major farm programs administered by the U.S. Department of Agriculture (USDA) will continue. Recently, the Senate passed a bill with provisions that will be included in the next farm bill. The bill must now go through the House, says Veronique de Rugy, a senior research fellow at the Mercatus Center. Looking to the recent history of farm bills in the United States, the immediate question becomes why they are necessary at all. In the end, recent farm bills have amounted simply to an enormous amount of spending on an area that requires little support. ■ The USDA distributes farm support through major programs, such as commodity payments, crop insurance, marketing support, farm conservation and agricultural research. ■ According to the White House budget, the historical trend of federal spending (adjusted for inflation) on farm programs averaged roughly $28 billion per year for the 1996 farm bill and $27 billion per year for the 2002 farm bill. ■ The five-year cost of farm programs in the 1996 farm bill was $141 billion, while the 2002 farm bill was $125 billion.

The most recent farm bill enacted in 2008, according to the Congressional Research Service (CRS), should have been significantly smaller than its predecessors. However, projections underestimated its true cost and the 2008 farm bill became yet another opportunity for rent-seeking special interests to receive unneeded financial support. ■ When the 2008 farm bill was enacted, the five-year cost (FY2008-2012) of major farm support programs was projected at $83 billion, an average of $16 billion per year. ■ CRS then updated estimates in 2010 to show a higher five-year cost of $87 billion, an average of $17 billion per year. ■ The White House budget, however, shows that spending for farm subsidies during this most recent period is closer to $104 billion, an average of $21 billion per year. Furthermore, the availability of these funds creates more opportunities for special interest groups and lobbying. In 2010, 10 percent of farms received 74 percent of all subsidies. Moreover, with farm household incomes 25 percent higher than the average U.S. household income, farm subsidies amount to corporate welfare for the relatively well off. Source: Veronique de Rugy, “The History of Farm Bill Spending,” Mercatus Center, June 11, 2012.

North Dakota considers drilling its way out of property taxes n June 12, voters in North Dakota went to the polls to decide if they would become the first state to abolish its property tax. Though the measure was rejected, that it was a possibility speaks to the incredible economic opportunities afforded to the state’s residents by its recent oil boom, says Investor’s Business Daily. Tapping the enormous Bakken Shale Formation, oil drillers have enormous extraction opportunities in the state that are making it one of the leading oil producers in the country. ■ Professor Mark Perry reports that North Dakota pumped another record amount of oil during the month of March at a rate of 575,490 barrels per day. ■ In so doing, it replaced California as the nation’s number three oil-producing state, behind Texas and Alaska. ■ At its current rate of production growth, North Dakota will likely top Alaska sometime this year. ■ Continental Resources, an Oklahoma-based oil company that operates 10 percent of the drilling rigs in North Dakota, estimates there are more than 900 billion barrels of oil in place. ■ Though only 27 billion to 45 billion barrels are actually recoverable with today’s technology, that’s still a sizable amount that will only get bigger as technology

advances. This incredible boom in instate production has an unsurprising effect on the local economy: flush with revenues, oil producers are injecting new life into the job market. ■ While the nation’s economy languishes, North Dakota has the nation’s lowest unemployment rate at just over three percent. ■ Ten North Dakota counties posted jobless rates at or below 2.5 percent in March, and Williams County boasts the lowest jobless rate in the country at just 0.7 percent. ■ North Dakota oil revenues generated an estimated $839 million in fiscal 2011 and are expected to deliver more than $2 billion over the next two years. ■ State per-capita income is $4,000 above the national average and, according to the Bureau of Economic Analysis, increased last year to $45,747 from $25,952 in 2000. The opportunities available to North Dakota residents could be expanded to the entire nation, were the Obama administration to free up the energy sector. Blocking the Keystone oil pipeline and largely prohibiting drilling access from federal properties prevent this potential benefit. Source: “North Dakota Drills Its Way Out Of Property Taxes,” Investor’s Business Daily, June 12, 2012.

eficits, taxes and spending are the defining issues of the 2012 campaign, but regulation deserves a seat at the table, too. The current regulatory environment places an enormous burden on the American economy by crushing small businesses with nonsensical rules and making the United States a toxic country in which to locate a business, say Ryan Young and Wayne Crews of the Competitive Enterprise Institute. Of course, efforts have been made to check this growing problem. The Obama administration recently targeted five regulations for elimination that will save $6 billion over the next five years. However, $1.2 billion per year is a drop in a bucket compared

to the overall impact of these regulations. ■ According to the Small Business Administration (SBA), the annual cost of complying with federal regulations has exceeded $1 trillion since around 2005. ■ Last year alone, 3,807 new final rules were published in the Federal Register — more than 10 per day. ■ During that same period, Congress passed only 81 new laws. ■ Furthermore, of the new rules, 212 are classified as “economically significant,” which means they cost more than $100 million per year. These regulations have a grossly distortionary impact on private markets. For example,

their aggregate impact favors large businesses over small ones, undermining politicians’ claims that they care greatly for the needs of undersized operations. ■ Big businesses with more than 500 employees pay about $7,755 per employee to comply with federal rules each year, according to the SBA. ■ But small businesses with fewer than 20 employees pay $10,585 per employee per year — that’s a built-in competitive advantage for big business of nearly $3,000 per employee. ■ Consequently, a recent Kauffman Foundation-Thumbtack.com survey of 6,000 small businesses found that “small businesses care almost twice as continued on page thirteen

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EASTERN ARIZONA FARMS St. Johns Irrigation & Ditch Company: #.+ ,'83 /9 25)':+* '6685>/3':+2? :=5 3/2+9 458:. 5, :.+ 3'/4 9:8++: 2+<+2'4* ":8++: /4 ": 5.49 ': :.+ /4:+89+):/54 5, &':+8 ":8++: '4* 4* &+9: ":8++: #.+8+ /9 *++*+* ')8+9 =/:. 9.'8+9 5, ": 5.49 88/-':/54 '4* /:). 536'4? #.+ /::2+ 5258'*5 !/<+8 8;49 :.85;-. :.+ 6856+8:? ,853 +'9: :5 =+9: '6685>/3':+2? 3/2+ '832'4* /9 /88/ -':+* </' ,255* -8'</:? ,25= */:). 54 4':/<+ '4* /3685<+* 6'9:;8+ ;:/2/@+* ,58 2/<+9:5)1 -8'@/4- 8/)+ Lyman Water Company: #.+ ,'83 /9 25)':+* 54 :.+ 95;:.=+9: 9/*+ 5, ": 5.49 '6685>/3':+2? 3/2+ =+9: 5, $" /-.='? #.+ 6856+8:? .'9 (++4 ,'83+* /4 '2,'2,' 9;*'4 '4* 5:.+8 <'8/5;9 )8569 /4 :.+ 6'9: '83 /4)2;*+9 ')8+9 *++*+* '4* 9.'8+9 5, ?3'4 &':+8 536'4? #.+ +4:/8+ 6856+8:? .'9 (++4 )2+'8+* ,58 ,'83/4- '4* /3685<+3+4:9 /4)2;*+ 953+ ,+4)/4- '4* */8: /88/-':/54 */:).+9 88/-':/54 /9 685</*+* (? -8'</:? ,25= */8: */:).+9 8/)+ St. Johns Irrigation & Ditch Company: #.+ ,'83 /9 25)':+* '6685>/3':+2? :.8++ 3/2+9 458:. 5, :.+ 3'/4 9:8++: 2+<+2'4* ":8++: /4 ": 5.49 */8+):2? =+9: 5, 4* &+9: ":8++: #.+8+ /9 *++*+* ')8+9 =/:. 9.'8+9 5, ": 5.49 88/-':/54 '4* /:). 536'4? =':+8 '832'4* /9 /88/-':+* </' ,255* -8'</:? ,25= */:). 54 4':/<+ '4* /3685<+* 6'9:;8+ ;:/2/@+* ,58 2/<+9:5)1 -8'@/4- #.+ 6856+8 :? /4)2;*+9 3/2+9 5, ,854:'-+ '254- 4* &+9: ":8++: 8/)+ Nutrioso Farm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

CENTRAL ARIZONA RANCH Yavapai and Coconino Counties, Arizona, between Camp Verde and Clints Well. &/4:+8 6'9:;8+ 95;:.+'9: 5, '36 %+8*+ '254- :.+ %+8*+ !/<+8 (+:=++4 '4* ,++: +2+<':/54 9;33+8 6'9:;8+ 54 :56 5, :.+ 5-52254 !/3 '254- /-.='?9 4+'8 2/4:9 &+22 (+:=++4 '4* ,++: +2+<' :/54 ':/54'2 58+9: 8'@/4- 225:3+4: ,58 '4/3'2 ;4/:9 );88+4: '44;'2 56+8':/4- 62'4 8;49 )'::2+ ,58 :.+ =/4:+8 '4* )'::2+ ,58 :.+ 9;33+8 '9+ 6856+8:? )54:'/49 /88/-':+* '4* 8'4-+ *++*+* ')8+9 25)':+* 54 )2'=9 !5'* +'9: 5, 52(8551 8/@54' 68/3'8/2? ;9+* '9 /88/-':+* -8'@/46'9:;8+ ,58 =+'4/4- )'2<+9 ";33+8 .+'*7;'8:+89 /4)2;*+9 " 25- 9/*+* .53+ =/:. 2'8-+ 9:5)1 ('84 54 ')8+9 25)':+* 54+ 3/2+ 458:.+'9: 5, 2/4:9 &+22 0;9: +'9: 5, 58354 '1+ !5'* #./9 /9 ' -55* ?+'8 85;4* 8'4). =/:. ./-. 35;4:'/4 9;33+8 )5;4:8? '4* 3/2* 25= +2+<':/54 =/4:+8 )5;4:8? 2+99 :.'4 :=5 .5;89 *8/<+ :/3+ ,853 :.+ .5+4/> 3+:85 '8+' '<+* '))+99 /9 685</*+* (? /-.='?9 :.85;-. :.+ 8'4). &/4:+8 8'4-+ /4)2;*+9 :.+ ++*2+ !5)1 )5= )'36 )54:'/4/4- ' " .5;9+ .'? ('84 '4* )588'29 8/)+ ,58 =.52+ 8'4). 58 +>)2;*/4- :.+ 9;33+8 .+'*7;'8:+89

CHARLES BENNETT United Country / Vista Nueva, Inc. 575/356-5616 www.vista-nueva.com

TEXAS & OKLA. FARMS & RANCHES • 735 acres Paris, Texas, excellent pasture, paved road frontage, huge lake, mansion home. $2,750,000. • 274 acres in the shadow of Dallas. Secluded lakes, trees, excellent grass. Hunting & fishing, dream home sites. $3,550/ac. Can add 300 more acres, only 30 miles out of Dallas. • 1,700-acre classic NE TX cattle & hunting ranch. $2,750/ac. Some mineral production. • 256 Acre Texas Jewel – Deep sandy soil, highrolling hills, scattered good quality trees, & excellent improved grasses. Water line on 2 sides rd., frontage on 2 sides, fenced into 5 pastures, 5 spring fed tanks and lakes, deer, hogs & ducks. Near Tyler & Athens. Price $1,920,000. Make us an offer! • 146 horse, hunting cattle ranch N. of Clarksville, TX. Red River Co. nice brick home, 2 barns, pipe fences, good deer, hogs, ducks, hunting. PRICE REDUCED to $375,000. • 535 ac. Limestone, Fallas, & Robertson counties, fronts on Hwy. 14 and has rail frontage water line, to ranch, fenced into 5 pastures, 2 sets, cattle pens, loamy soil, good quality trees, hogs, and deer hunting. Priced reduced to $1,750 per ac. • 10 Wooded Acres with a 6-bedroom, 3.5 bath and a 2-car garage and shop for $185,000, owner financed with 10% cash down. • 134 acres Wortham, Texas, $1,750/ac. Hunting and cattle. Fronts FM Hwy.

UN D ER CONTRACT

Joe Priest Real Estate 1205 N. Hwy 175, Seagoville, TX 75159

972/287-4548 • 214/676-6973 1-800/671-4548 • Fax 505/998-6236 joepriestre.net • joepriestre@earthlink.com

“America’s Favorite Livestock Newspaper”

July 15, 2012 much about licensing regulations as they do about tax rates when rating the business-friendliness of their state or local government.” There is now a bill, however, that would do much to address this problem. By requiring Congress to vote on all economically significant rules, the Regulations from the Executive in Need of Scrutiny (REINS) Act would lighten the regulatory burden. It has passed the House, but is stalled in the Senate.

Is there still a case for coal?

Source: Ryan Young and Wayne Crews, “Washington’s Ten Thousand Commandments,” American Spectator, June 5, 2012.

n March 27, the Environmental Protection Agency (EPA) proposed what it calls the first “Clean Air Act standard for carbon pollution for new power plants.” The proposal, if enacted, will effectively outlaw the construction of new coal-fired power plants in the United States by capping acceptable carbon dioxide emissions at a level below what is attainable by modern plants, says Robert Bryce, a senior fellow at the Manhattan Institute.

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This proposal will effectively eliminate the expansion of coalfueled electricity domestically. This will not only be enormously costly to American electricity consumers, but is also unlikely to reduce emissions. ■ Coal provides about 46 percent of domestic electricity, with natural gas providing about 24 percent and nuclear 20 percent. ■ The United States has about 237 billion tons of coal reserves — about 28 percent of the world’s known deposits — and about 241 years of supply at current rates of consumption. ■ It is also one of the cheap-

WORKING COW and HORSE RANCHES CUT OVER TIMBER LAND, LAKES and STREAMS Write or call for free publication:

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Farms & Ranches

REAL ESTATE

541/473-3100 JACK HORTON

Paul Bottari, Broker • 775/752-3040 www.bottarirealty.com

NEVADA FARMS & RANCH PROPERTY Farm near Wells, NV: 90 acres in hay; 2 homes; shop and storage three miles from town. $450,000

BROKE OFF MOUNTAIN RANCH: 348 head BLM year long permit, two sections deeded, good hunting for mule deer and Audad. Some flat some rough, a little remote, $950,000. LA PALOMA LAND & CATTLE: Located 10 miles south of Carlsbad, 437 BLM permit year long approx. 2,170 deeded, good working headquarters, only $3,000 a cow. McCOLLUM RANCH: Located in the south end of the Guadalupe Mountains, 540 acres deeded, 250 head year long in the Lincoln National Forest lots of grass, $800,000. I challenge you to find ranches that will pencil like these! Lots of information and pictures online at nmhomeranch.com.

New Mexico Home Ranch Realty JOE COX, QUALIFYING BROKER, 575/361-5269 130 Cougar Rd., Carlsbad, NM 88220 • Office: 575/981-2427 www.nmhomeranch.com • jjcox@pvtn.net

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RANCH SALES P.O. Box 1077 • Ft. Davis, Texas 79734

NEED RANCH LEASES & PASTURE FOR 2012 & 2013 DAVID P. DEAN Ranch: 432/426-3779 • Mob.: 432/634-0441 www.availableranches.com

INTEREST RATES AS LOW AS 3%. PAYMENTS SCHEDULED ON 25 YEARS

JOE STUBBLEFIELD & ASSOCIATES 13830 Western St., Amarillo, TX • 806/622-3482 Cell 806/674-2062 • joe3@suddenlink.net Michael Perez Assocs Nara Visa, NM • 575/403-7970

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er gas emissions targeted by the Clean Air Act) to levels far below those mandated by the EPA. Finally, the new rule will prove to be completely ineffective at reducing carbon dioxide emissions worldwide. ■ As domestic coal use declines, U.S. producers are selling more of their product overseas. ■ Between 2010 and 2011, U.S. coal exports increased by more than 31 percent to about 80 million tons, and coal exports now account for about 8 percent of all U.S. coal production. ■ The ongoing increase in global coal consumption will make any reductions in U.S. coal consumption and carbon dioxide emissions insignificant. ■ Over the last decade, global carbon dioxide emissions rose by 28.5 percent, despite a reduction in the United States’ emissions by 1.7 percent over the same period. Source: Robert Bryce, “Is There Still a Case for Coal?” Manhattan Institute, May 2012.

w w w . a a a l i v e s t o c k . c o m

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Bottari Realty

est sources of energy: the Energy Information Agency estimates that by 2016, coal-fired production will cost $95 per megawatthour compared with $96 for onshore wind, $211 for photovoltaic generation and $244 for offshore wind. ■ The reduction of such a large and cheap source of electricity for American consumers will have substantial impacts. Additionally, though the EPA is motivated by the goal of reducing carbon dioxide emissions, its policy will target companies that are assisting it with equally important objectives. The newest coal-fired plants are reducing emissions of sulfur dioxide and nitrogen oxide (oth-

Come to Our Country!

5 0 5 / 2 4 3 - 9 5 1 5

Agrilands

Page 13

Small cattle ranch for sale approximately 40 miles northwest of Roswell, north of State Highway 246 just east of the Lincoln County line. 5,700 total acres to include 960 deeded acres. Grazing capacity set at 164 AU’s. Livestock and domestic water provided by three wells and a buried pipeline system. New improvements that consist of a three bedroom residence, maintenance shop along with a feed barn/tack room combination. One set of working pens. This ranch is ready to go. Price: $985,000

Bar M Real Estate

SCOTT McNALLY, Qualifying Broker Cell: 575/420-1237 Office: 575/622-5867

Roswell, N.M. 88202 • www.ranchesnm.com

■ 675 Ac. Excellent Cattle Ranch, Grass Runway, Land Your Own Plane: Major Price Reduction. 3-br, 2ba home down 1 mile private land. New 40x42 shop, 40x60 livestock barn, over 450 ac. in grass. (Owner runs over 150 cow/calves, 2 springs, 20 ponds, 2 lakes, consisting of 3.5 and 2 ac. Both stocked with fish. Excellent fencing. A must farm to see. MSL #1112191

See all my listings at: paulmcgilliard.murney.com

PAUL McGILLIARD Cell: 417/839-5096 1-800/743-0336 MURNEY ASSOC., REALTORS SPRINGFIELD, MO 65804

■ NEW LISTING, 327 ACRES: Cattle/horse ranch. Over 225 acres in grass. 3/4 mile State Hwy. frontage. Live water, 60x80 multi-function barn. 2-bedroom, 1-bath rock home. Priced to sell at $1,620 per acre. MLS #1204641 ■ 483 Ac., Hunter Mania: Nature at her best. Don’t miss out on this one. Live water (two creeks). 70+ acres open in bottom hayfields and upland grazing. Lots of timber (marketable and young) for the best hunting and fishing (Table Rock, Taney Como and Bull Shoals Lake) Really cute 3-bd., 1-ba stone home. Secluded yes, but easy access to Forsyth-Branson, Ozark and Springfield. Property joins National Forest. MLS#1108090

RANCH & FARM REAL ESTATE

Ben G. Scott & Krystal M. Nelson, Brokers 1301 Front St., Dimmitt, TX 79027 1-800/933-9698 day/night ➤ www.scottlandcompany.com ➤ www.texascrp.com

ATTENTION LAND OWNERS: We have sold ranches and other related properties in the Southwestern United States since 1966. We advertise extensively and need your listings (especially larger ranches). See our websites and please give us a call to discuss the listing of your property. We have a 1031 Buyer for a $2,000,000 to $4,000,000± ranch in Central, Southern or North Texas, Western and Central Oklahoma.

HEADQUARTERS WEST LTD. Con A. Englehorn See details at www.headquarterswest.com || 602/258-1647

Kimble Ranch Southeastern Arizona 40 miles NE of Douglas on U.S. Hwy 80. 9,228 ac deeded, 9,352 ac Arizona State Lease, 747 ac New Mexico State Lease, 4,470 ac U.S. Forest, and 1,356 ac BLM. Estimated carrying capacity 550 AU yearlong. Elevation from 4,100' to 5,800'. Well improved with two building sites and 20 pastures with permanent water in each. This is an excellent ranch that has been in the same family for three generations. Price $3,800,000. This ranch is also offered as two units: ■ East Ranch – 6,507 ac deeded, 3,255 ac Arizona State Lease, 747 ac New Mexico State Lease, 1,356 ac BLM, and 4,470 ac U.S. Forest, Two building sites. Estimated capacity 380 AU yearlong. Price 2,700,000 ■ West Ranch – 2,721 ac deeded, 6,097 ac AZ State Lease. No buildings. Estimated capacity 170 AU yearlong. Price $1,200,000

Livestock Market Digest

Page 14

Producer Education = Consumer Satisfaction by CALLIE GNATKOWSKI-GIBSON

he Beef Quality Assurance (BQA) program, based on industry and consumer research and funded by the Beef Checkoff, is focused on improving the efficiency and profitability of the beef industry. “The program is focused on trying to improve the quality of our product and meet consumer expectations. We teach common sense approaches to improving the quality of beef,” said Manny Encinias, New Mexico State University. “In my mind, it is the single most successful producer education program across the United States.” In New Mexico, BQA training is conducted by the Cooperative Extension Service in cooperation with the New Mexico Livestock Board (NMLB), which serves as the third-party certifying agency. The program is open to anyone involved in beef or dairy cattle production, including ranch hands or dairy workers who may not own their own cattle. After attending a training workshop and passing the written test given at the end, producers become Beef Quality Assurance Trained Producers. Individuals interested becoming Beef Quality Assurance Certified Producers, the next level of the program, must also have established and documented a valid Veterinarian/Client /Patient Relationship with their veterinarian and sign a BQA Critical Management Plan/Affidavit of Compliance. Typically, this certification goes to ranchers and dairymen who are interested in using the BQA program as a

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marketing tool. Through BQA training, ranchers learn not only how to improve their efficiency and profitability, but also more about the needs and expectations of consumers. “BQA is more than just giving injections properly,” said John Wenzel, Extension Veterinarian with New Mexico State University and the State Coordinator of New Mexico’s Beef Quality Assurance Program. “BQA is an attitude towards management that will insure the highest quality product for our consuming public. It is making sure that all aspects of beef production are done in a way that we can be proud of.” “Becoming BQA certified shows that you’re not just a rancher out there who has been doing things the same way for the past 50 years,” Encinias agreed. “It shows that you’re continuing to learn and improve, and are concerned not only with increasing your profitability, but also concerned about the end product.” “Everyone is responsible for the welfare of the industry, he continued. “I tell people that it doesn’t matter if they have five cows or run 5,000 mother cows, they are all part of the production chain.” Teaching producers to change the location of intramuscular injections to the neck, therefore reducing injection-site lesions in valuable cuts of meat, was an early success of the national BQA program. Through the BQA’s educational effort, producers learned that both carcass yield and consumer acceptability of beef products were being impacted. “We improved the quality of our product and are able to manage our cattle to minimize or prevent disease when needed,” Encinias said. When you look at industry data, he said, injection site trauma is no longer really an issue. “That in itself is a testimony to how effective the program has been. Since then, the focus has moved to consistency and pro-

viding a better eating experience for the consumer.” BQA programs and topics are developed through research and evaluation of different sectors of the industry. New Mexico’s program incorporates national information with pertinent state and regional information. “Most ranchers want to do everything they can to provide a high quality product,” Wenzel explained. “NM BQA is a verification process that states that a ranch will follow practices that will help provide this high quality product.” Developed and funded by the beef industry, the program is free and voluntary for producers. “One of the great things about BQA is that it is completely industry-driven,” Encinias pointed out. “From academics to researchers to the extension service to producers, everyone had a hand in making the program what it is today.” That industry leadership could also have long-term benefit with regulatory agencies. “If we show that we are policing

July 15, 2012 ourselves, agencies could be less likely to feel the need to interfere,” he noted. Topics, materials and information presented at BQA trainings are constantly changing, so producers who have attended a past session could benefit from a current workshop. “As an industry, it is important that we certify as many producers as possible as BQA certification assures our consumers that we care about the product they purchase,” Wenzel said. “I feel it is our responsibility as beef producers to do our absolute best, and the New Mexico Beef Quality Assurance program is one tool in the toolbox to help accomplish this goal.” “We know people are busy, and it’s hard to draw people away from what they need to be doing,” Encinias noted. “We are working hard to make our programs and materials fit the needs of those we are trying to reach.” Animal welfare and well being, including cattle handling and the judicious use of antibiotics, is one current focus for BQA training. “We want to make sure that ranchers understand that how they do things on the ranch will impact the ultimate product,” Encinias explained. Youth training and education is another emphasis, in New

Mexico and across the nation. “We want to focus on getting information to kids, and to make sure they understand that they may just be exhibiting one animal at the State Fair, but they are part of a larger chain,” Encinias said. On the national level, there is a big effort to make sure that, especially on large operations, the people who handle the cattle receives BQA training in addition to owners and managers. Because of the large Spanish speaking population in some industry sectors, educational materials in Spanish are now available. “We want to make sure they realize that they’re not just doing a job, that they’re part of a global industry,” Encinias said. In other industries, companies spend thousands of dollars on private consultants looking for the kind of information the BQA program provides to beef producers at no cost, Encinias pointed out. “That dollar that you pay into the Beef Checkoff at sale time is returned exponentially in programs like this. As businessmen and women, we have stay current. The past generation of beef producers’ efforts to stay involved and engaged is what got us to this point, and we want to pass that on to future generations.”

Taxation goes global he American founders understood that people would have more say over their government the closer it was to them, which is why the United States was set up as a federal republic. This can be seen within the Constitution, where the federal government is given few powers while state and local governments maintain many, if the people so choose, says Richard Rahn, a senior fellow at the Cato Institute. This general principle, that government is better when it is closer to the people, now faces a movement without precedent in scale: the movement for the globalization of taxation. ■ The United Nations is pushing a global financial transactions tax “to offset the costs of the enduring economic, financial,

fuel, climate and food crises, and to protect basic human rights.” ■ The World Health Organization, in the name of boosting expenditures for health research for diseases that “disproportionally affect the developing world,” has just proposed in a new report a “Financial Transactions Tax and a Solidarity Tobacco Contribution.” ■ James Hansen of NASA again recently proposed a “flatrate global tax” on carbon to stop global warming. ■ In 2009, then-House Speaker Nancy Pelosi expressed her support for a Group of 20 “global tax” — a sentiment echoed by Vice President Biden in March. These tax mechanisms would divert monies away from national populations that have rightfully earned them (both rich and poor), doling them instead to the

ruling elite of developing nations. Furthermore, there is an inherent lack of accountability for the internationally governing bureaucrats who would oversee such taxes. Not only are they incredibly distant from the people they are taxing, but their actions remain a cut above the purview of national governments. Tax money tends to be much better spent when the people can see how it is spent and who is spending it. This is accomplished more easily at local levels of government, where there can be more real representation and accountability, rather than at the national level and particularly at the international level, where there is no effective representation. Source: Richard Rahn, “Taxation Goes Global,” Washington Times, June 4, 2012.

New Report: Global Warming Policies Might Be Bad For Your Health olicies to reduce global warming may be doing more harm than good to public health in both developing and industrialised countries. This is the conclusion of a new report published by the Global Warming Policy Foundation. In his report, Dr. Indur Goklany, a leading expert on human health and climate change, shows that ■ Global warming does not currently rank among the top public health threats ■ The contribution of much-publicized ‘Extreme Weather Events’ to global mortality is negligible and declining. ■ Poverty is a much larger public

health threat than global warming ■ Present climate policies are already adding to death and disease ■ Focused adaptation to climate change and/or economic development would provide greater health benefits at lower costs than climate mitigation policies. The report warns that exaggerating the impact of global warming on human health seriously risks misdirecting the world’s priorities and resources in combating poverty and improving public health. “Climate policies that hinder or slow down economic development or increase the price of energy and food threaten to

augment poverty and, as a result, increase net death and disease,” Dr Goklany said. The increase in biofuel production between 2004 and 2010, for example, is estimated to have increased the population in absolute poverty in the developing world by over 35 million, leading to about 200,000 additional deaths in 2010 alone. “Focused adaptation designed to reduce vulnerability more broadly to today’s urgent health problems would deliver greater reductions in deaths at a lower cost than climate mitigation policies,” Dr Goklany added. For a full copy of the report, go to: http://thegwpf.org/ images/stories/gwpf-reports/goklany-public_health.pdf

“America’s Favorite Livestock Newspaper”

July 15, 2012

Page 15

Why we will never run out of oil

Study: polar bear population ‘Not in crisis’ limate change doomsayers have for years claimed that declining polar bear populations in the Arctic are a consequence of manmade global warming. But a new study has found that the bear population in part of Canada is larger than many scientists thought and might actually be growing. In 2004, Environment Canada researchers concluded that the number of bears along the western shore of Hudson Bay had dropped 22 percent since 1984, to 935 bears, and they estimated that by 2011, a continuing decrease would bring the number down to 610. The Hudson Bay region is considered a bellwether for how polar bears are faring elsewhere in the Arctic, according to Canadian newspaper The Globe and Mail. The decrease, the scientists asserted, was due to warming temperatures that melt ice faster and ruin the bears’ ability to hunt. “That sparked worldwide concern about the future of the bears and prompted the Canadian and American governments to introduce legisla-

tion to protect them,” The Globe and Mail reported. The World Wildlife Fund even stated in 2008: “If current warming trends continue unabated, scientists believe that polar bears will be vulnerable to extinction within the next century.” But a survey released on April 4 by the Government of Nunavut — a federal territory of Canada — shows that the number of bears is now 1,013 and could be higher. “The bear population is not in crisis as people believed,” said Drikus Gissing, Nunavut’s director of wildlife management. “There is no doom and gloom.” He added that the media in Canada have led people to believe that polar bears are endangered, but “they are not.” He estimated that there are about 25,000 polar bears in Canada’s Arctic region, and “that’s likely the highest [number] there has ever been.” Nunavut, which is the size of Western Europe, is home to about 32,000 people.

Medicare and Medicaid fraud is costing taxpayers billions edicare and Medicaid fraud have become an extraordinarily lucrative business. Though estimates vary widely on the exact figures, the opportunities to scam taxpayers are so substantial as to entice everyone from Nigerian mobs to New York crime families to participate. This is likely due to the sheer vastness of the sums at stake, says Merrill Matthews, a resident scholar at the Institute for Policy Innovation. ■ Federal authorities announced on May 2 they had arrested 107 health care providers in several cities and charged them with cheating Medicare out of $452 million. ■ Similarly, federal officials charged 94 people in 2010 with making $251 million in phony claims. ■ When the Medicare Fraud Strike Force visited nearly 1,600 Miami businesses in 2007 that had billed Medicare for durable equipment, it found nearly a third of the businesses, 481, didn't even exist, yet they had billed Medicare for $237 million. Aggregately, reliable information on fraudulent behavior nationwide is scarce, the obvious reason being that much of it goes unreported. However, various estimates offered by members of the administration hint at its enormous scale. ■ Federal authorities boast of recovering $4.1 billion in 2011 from fraudulent activity, but spent millions of dollars to recover it. ■ In 2010 the Government Accountability Office (GAO) released a report claiming to have identified $48 billion in what it termed as “improper payments” (nearly 10 percent of the $500 billion in outlays for that year). ■ Others, including U.S. Attorney General Eric Holder, suggest that there is an estimat-

ed $60 to $90 billion in fraud in Medicare and a similar amount for Medicaid. To address these issues, federal officials need to adopt policies that are better-tailored to preventing fraud. To this end, lessons from private sector insurance providers can be instructive. ■ Though it is currently attempting to change methods, the Department of Health and Human Services has for years operated on a “pay and chase” model for stopping fraud. ■ Under this system, the

department pays out most claims and only pursues wrongdoers after subsequent information is discovered. ■ Private sector businesses, on the other hand, employ preclaims adjudication to limit fraudulent claims. This offers a partial explanation for why private insurers lose an estimated 1 percent to 1.5 percent in fraud compared to an estimated 10 to 15 percent for Medicaid and Medicare. Source: Merrill Matthews, “Medicare and Medicaid Fraud Is Costing Taxpayers Billions,” Forbes, May 31, 2012.

he notion that world oil production had reached its summit and would soon begin a decline — bringing with it shortages, economic collapse, resource wars and general ruination — was in vogue not so long ago. Referred to as “peak oil,” this momentous point in history has been invoked numerous times over the past few decades as a mark of inevitable civilizational decline, says A. Barton Hinkle, a columnist at the Richmond TimesDispatch. Reliable media outlets have lent credence to the belief: according to reports by the BBC, New York Times and Houston Chronicle, we very well should be on the downslope of oil production right now. However, current production trends and trade patterns suggest this is far from the truth. “Peak oil” and general fears about the depletion of “recoverable reserves” mislead the public insofar as they fail to account for the role of human ingenuity. That is to say, they ignore the roles of technological advancements and market forces in expanding production options and increasing reserves. The contributions of both technology and economics can be seen in the current oil boom taking place in North Dakota: ■ The high gasoline prices over

the last decade encouraged producers to seek out new sources of oil that were previously prohibitively expensive to exploit. ■ This provided impetus for drilling in the Bakken and Three Forks fields — enormous domestic supplies that are relatively more expensive to take advantage of. ■ Moreover, technological advancements in horizontal drilling and hydraulic fracturing opened the fields up to production and gave rise to the state’s boom. ■ This allowed the state to become the number two domestic producer in only the last six years. Furthermore, this same phenomenon can be seen on a global scale: market pressure and innovation in production allow for evermore sources of oil. ■ Production has risen strikingly fast in places such as the tar sands of Alberta, Canada — a source that was not previously viable. ■ Oil producers are also seeking new deposits in South America (Colombia and Brazil), and especially in the Amazon. ■ They are also expanding offshore discovery ventures, looking specifically into a potentially huge field off the northeast shoulder of the South American continent. Source: A. Barton Hinkle, “Why We’ll Never Run Out of Oil,” Reason Magazine, June 1, 2012.

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N.M. Student Chosen as a 2012 New Century Farmer PROGRAM PREPARES YOUNG FARMERS FOR SUCCESS IN 21st CENTURY eth Menefee, Lake Arthur, New Mexico, has been selected to participate in the 2012 New Century Farmer Program July 8 through 14 in Johnston, Iowa.

Menefee is one of 50 outstanding young people representing 24 states who will participate in the program. This exclusive, highly competitive program develops young men and women committed to pursuing a career in production agriculture. Menefee, who attends Oklahoma State University, will take part in a series of workshops and sessions during the conference. Topics will include the global marketplace, farm financing, demographic trends and risk management. He will hear from motivating and informative keynote speakers who will educate him on the risks and rewards involved with production agriculture. In addition to classroom learning, students will experience the latest developments in agricultural technology. The New Century Farmer program is sponsored by Pioneer Hi-Bred, a DuPont business; Case IH; CSX Corporation; and Farm Credit; with media partner Successful Farming as a special project of the National FFA Foundation. The program is designed to provide participants with valuable skills and knowledge applicable to their own farming operations. In addition, they will build a network of colleagues that will benefit them throughout their careers.

f you have livestock, a product or service that stockmen and their families need, they will find out about it quickly if you advertise in the Digest. Digest readers know value when they see it and they respond rapidly to a good offer. Before you plan your advertising budget, think hard about how to stretch your dollars and where they are spent the most efficiently. Are you paying more to reach fewer qualified potential customers than you would receive in the Digest? The Digest’s circulation is concentrated in the most important livestock producing states: Nebraska, Colorado, Wyoming, Montana, Utah, Idaho, California, Oregon, Washington and Texas. The Digest caters to the most active readers in the livestock world — who ARE the buyers and sellers of livestock, the ones who show up and speak up. It is the ONLY place to get Lee Pitts’ perspective on the world and how we are going to thrive into the future.

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N.M. SRM Black Range Summer Tour he New Mexico Section of the Society for Range Management will be holding August 3 a summer range tour featuring 100 years of grazing and forestry practices in the rugged Black Range west of Truth or Consequences, N.M. The tour (qualifies for 5 SRM CEU credits) will leave at 7:30 a.m. from the Black Ranger District parking lot (1804 North Date Street) and head first to Winston to see a custom-made log cabin built from timber harvested off the Black Range before moving on to a grassland research site, a ponderosa pine restoration site with thinning and burning treatments, and a

long-term riparian grazing research site. Local Black Range permittees will be on hand to discuss challenges and opportunities with grazing on federal lands. Lunch will be provided for this bring-your-own-transport tour, and there will be an open cookout/social the evening prior. The $40 fee (students $20) supports the section’s NMSU range scholarships and youth programs (including support for the New Mexico Ranch Camp). For more details and registration information, please see nmrangelands.org or contact N.M. SRM President Les Owen at lowen@nmda.nmsu.edu

Is it time to stop building convention centers? ver the last 20 years, convention space in the United States has increased by 50 percent; since 2005, 44 new convention spaces have been planned or constructed in this country alone. That boom hasn’t come cheap. In the last 10 years, spending on convention centers has doubled to $2.4 billion annually, much of it from public coffers. The resultant glut of convention centers, has undermined the financial strength of these notable investments. The annual number of conventions is down, as are the number of attendees, and convention centers are struggling to meet projected revenues. ■ The actual number of conventions hosted in the U.S. has fallen over the last decade. ■ Attendance at the 200 largest conventions peaked at about 5 million in the mid-1990s and has fallen steadily since. ■ Christopher Leinberger, president of LOCUS emphasizes that while capturing only one percent of the national mar-

ket for conventions would likely be profitable, 300 cities bought that same logic. Consequently, numerous cities across the country invest in multimillion-dollar convention halls that fail to pay themselves off. The experience of Washington, D.C.’s Walter E. Washington Convention Center, which opened in 2003, demonstrates this fact. ■ The center has won numerous awards for its outstanding amenities and grand ambition, with 68 public restrooms, 38 escalators and 31 elevators. ■ It also has more than 4 acres of glass walls, 160 types of lights and 30,293 light bulbs. ■ However, the cost of the center was still a staggering $833.9 million. ■ Between 2006 and 2008, it missed its booking goals by 13 percent, 24 percent and 29 percent, respectively, and it runs at a loss of about $22 million a year. Source: Amanda Erickson, “Is It Time to Stop Building Convention Centers?” The Atlantic Cities, June 11, 2012.

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July 15, 2012

We can cut government: Canada did wo decades ago Canada suffered a deep recession and teetered on the brink of a debt crisis caused by rising government spending. Since then, the country has undergone a remarkable recovery, reclaiming financial strength and harnessing a powerful economic boom. The United States would do well to learn what it can from Canada’s experience and adopt its progrowth policies, says Chris Edwards, director of tax policy studies at the Cato Institute. The origins of Canada’s problem lie within an incredible spending binge that began in the late 1960s and lasted for 16 years. ■ The Canadian leader during most of that time, Pierre Trudeau, expanded programs, raised taxes, nationalized businesses and imposed barriers to international investment. ■ Government spending as a portion of gross domestic product (GDP) skyrocketed during this period, as did the federal government’s total debt level. ■ Canada also suffered from high inflation during the 1970s and early 1980s. This growing problem was addressed first by a series of pro-market reforms throughout the 1980s and 1990s, inspired in part by comparable programs instituted by Ronald Reagan and Margaret Thatcher. ■ In the mid-1980s, the Canadian central bank adopted a goal of price stability, which greatly

reduced inflation and has kept it low and stable ever since. ■ Following U.S. tax reforms in 1986, Canada enacted its own income tax cuts under Progressive Conservative Prime Minister Brian Mulroney. ■ The government privatized Air Canada in 1988, Petro-Canada in 1991 and Canadian National Railways in 1995. ■ Canada privatized about two dozen “crown corporations” in the late 1980s and early 1990s. ■ The other major reform of the late 1980s was the free trade agreement with the United States. The market reforms were accompanied by substantial spending cuts in the late 1990s that finally got Canada’s fiscal house in order. ■ Between 1994 and 1996, the Canadian government cut defense, unemployment insurance, transportation, business subsidies, aid to provincial governments and many other items. ■ As a result, total noninterest spending fell by 10 percent. ■ With this restraint, federal spending as a share of GDP plunged from 22 percent in 1995 to 17 percent by 2000. ■ These spending reforms allowed Canada to balance its budget every year from 1998 to 2008. Source: Chris Edwards, “We Can Cut Government: Canada Did,” Cato Policy Report, May/June 2012.

Unconventional energy meets conventional politics heap natural gas is upending the entire energy outlook. It has scrambled the outlook for coal-fired energy — new gas-fired electricity is now cheaper than coal — more than any prospective cap and trade program or punitive Environmental Protection Agency regulation could ever do. It also renders most renewable sources such as wind and solar even less competitive with fossil fuels, says Steven Hayward, the F.K. Weyerhaeuser Fellow at the American Enterprise Institute. Meanwhile, the price of natural gas has fallen so far that the industry is desperately trying to figure out how fast it can become an export industry to sell it overseas where the market price is higher than here. In short, natural gas has the potential to become a crucial boom industry for the United States. A similar story is starting to unfold with domestic oil. In testimony recently by Anu Mittal, the director of natural resources and environment for the Government Accountability Office, she explained deposits in the western U.S. (chiefly oil shale in the Rockies) have approximately 3 trillion barrels of proven reserves. Public and private analysts estimate that half of this is recoverable. This establishes the starting point of what could be a novel of America’s energy renaissance. However, this outlook should be taken with a grain of salt: government regulation and political buckling to environmental groups can choke this industry and halt the energy revolution before it begins. ■ Most shale oil, unlike shale gas, is located on federal land. ■ This offers the current administration ample leeway in mandating burdensome permitting processes and applications, driving up costs.

■ Furthermore, these deposits of shale oil are far from the nation’s refiners — pipelines will have to be built that can crisscross the United States to get this resource where it needs to go. ■ This will likely result in a lengthy political battle involving the environmental lobby, not unlike the one that has caused costly delays for the Keystone

XL pipeline. If domestic energy in both gas and oil is to be optimized and our dependence on foreign energy lessened, Washington will have to get out of the way and allow producers to do what they do best. Source: Steven Hayward, “Unconventional Energy Meets Conventional Politics: Which Will Win?” Real Clear Markets, May 16, 2012.

Farm Credit Bank of Texas Reports Solid Earnings & Asset Growth arm Credit Bank of Texas (FCBT), a wholesale funding bank, reported an increase in loan volume during the first quarter of 2012. The bank’s gross loan portfolio totaled $10.6 billion at March 31, 2012, up 3.3 percent since Dec. 31, 2011. This growth was attributed primarily to increases in the bank’s participations loan portfolio, offset by a decrease in the bank’s direct loans to its affiliated lending cooperatives. The quality of the loan portfolio also improved, with 93.8 percent of total loans classified as acceptable or other assets especially mentioned at March 31, 2012, compared with 91.2 percent at Dec. 31, 2011. Nonaccrual loan volume decreased 13.1 percent during the quarter to $89.2 million at March 31, 2012. FCBT net income for the first three months of 2012 was $34.2 million, a decrease of 18.1 percent from the same period of 2011. The decrease was mainly attributable to a decrease in net interest income, due primarily to concession expenses on debt that was called and replaced with lower-cost debt, and to an increase in provision for credit losses. “Farm Credit Bank of Texas is pleased to report solid earnings

and growth in our loan portfolio during this sluggish period for the financial sector,” said Larry Doyle, FCBT chief executive officer. “Although many farmers and ranchers are still feeling the impact of last year’s drought as well as higher operating costs this year, agriculture remains a bright spot in the nation’s economy,” added FCBT Board Chairman Jimmy Dodson. Shareholders’ equity totaled $1.2 billion at March 31, 2012, an increase of 2.8 percent. Farm Credit Bank of Texas is owned by 17 rural financing cooperatives in Alabama, Louisiana, Mississippi, New Mexico and Texas, which in turn are owned by their customers — farmers, ranchers, agribusinesses, country homeowners and other rural landowners. Together, the Austin-based bank and its affiliated lenders constitute the Texas Farm Credit District, the largest rural lending network in the five-state region. Collectively, the district lenders reported $96.0 million in net income for the first quarter of 2012, a 5.9 percent increase over the same quarter a year ago. District loan volume increased 2.4 percent to $16.0 billion at March 31, 2012, from $15.6 billion at year-end 2011.