Beijing Targets California Agriculture as Trade Dispute Escalates

Farm workers farmingCalifornia’s massive agriculture industry is China’s top initial target as Beijing responds to the Trump administration’s vow earlier this month to slap tariffs on some $50 billion of Chinese steel and aluminium imports.

In an announcement over the weekend, Chinese trade officials said California’s nuts, fruit and wine were among 128 U.S. imports that would face a new 15 percent tariff upon reaching Chinese shores. The total annual value of the imports is about $3 billion, according to a San Francisco Chronicle report, suggesting that for now Beijing is not eager to escalate its trade dispute with Washington over alleged Chinese steel and aluminum dumping on the international market and theft of U.S. intellectual property.

After Canada and the European Union, China is the third biggest international customer for Golden State agriculture, importing more than $2 billion worth in 2016, according to an official state report. That’s around 10 percent of California’s total of $21 billion in international agricultural exports in 2016. Pistachios, plums, oranges and almonds were the state’s most popular products with Chinese consumers.

Even before the formal Chinese announcement of retaliatory tariffs, many observers were wary of how California could be buffeted by a U.S-China trade war.

“We could be in a really nasty trade spat, and we’ve seen that agriculture is usually a big target. … We are greatly concerned,” a California Farm Bureau Federation official told the Los Angeles Times in a March 2 story. A UC Davis economist interviewed by the Times voiced similar concerns, noting California agriculture is more dependent on international sales than other large agricultural states.

Some farmers welcome fight, cite unfair practices

But in Kern County, according to a Bakersfield Californian report, anxiety was tempered by a sense among some farmers that it was time someone stood up to the unfair trade practices they said they dealt with in the Chinese and South Korean markets.

Dennis Johnston, a partner in Edison-based Johnston Farms, said powerful farming lobbies in the Asian nations had established barriers to California imports that didn’t involve tariffs, such as additional fumigation requirements that cut into California growers’ profits.

It’s nothing new for California agricultural interests to be early targets in trade disputes, including with nominal U.S. trade allies like Canada and Mexico. Because food has a limited shelf life, tariffs can take a relatively quick toll on a targeted nation. Tariffs on familiar consumer products like wine or grapes can also grab headlines in ways that tariffs on machine parts probably can’t. Analysts say that’s why the next target of China after California – at least if Beijing’s trade dispute with the Trump administration escalates – is likely to be pork products from Midwestern states. There would also be a political factor in such a move – these states often swing from party to party and Donald Trump is likely to need some or most to gain re-election in 2020.

But there’s a third view evident in Golden State reaction to China’s tariffs beyond alarm and the belief that some attempt to confront Beijing over its trade practices is necessary. That’s the view that this fight might fizzle out.

In an analysis posted by the Times over the weekend, Richard Matoian, executive director of the California-heavy American Pistachio Growers, said, “From what we’ve seen, the Trump administration can be very unpredictable. … There’s still a month yet before any tariff would take effect, so there’s going to be a lot of political posturing.”

This article was originally published by CalWatchdog.com

Steeper Fines Proposed to Punish Water-Wasters

SprinklerCalifornia’s ongoing water crisis promised to extend the controversy over fines and regulations well into the next year — if not beyond. While some areas suffer, others flourish, and fines — in some instances aggressively applied — have been meted out unevenly.

Despite limiting water use, residents in lower-income areas have complained that they have faced substantial fines, while some of the Golden State’s most conspicuous consumers have escaped penalty. In Apple Valley, “where the median household income is below $50,000 a year,” some have struggled to keep their consumption below the limit, while one “home under construction in Bel Air has been issued permits for five pools,” the New York Times reported:

“Los Angeles officials hope to start imposing fines so steep that even the wealthy who populate Bel Air will notice. Elsewhere, though, fines have already piled up on middle-class Californians. The Central Valley city of Clovis, faced with an order to cut back 36 percent, has meted out more than 23,000 fines since the mandatory water reductions began in June. In Santa Cruz, where water supplies have run dangerously low, the city has assessed more than $1.6 million in penalties for using too much water.”

Mid-month, Gov. Jerry Brown issued a fresh order expanding and strengthening his strict water policies. “The order gives state water officials greater authority to deal with drought conditions and to cope with potential winter storms from El Nino, a periodic warming of ocean surface temperatures,” as Reuters reported, extending emergency conservation “through October if California still faces a drought in January. The order also extends the suspension of some environmental rules, lets some state residents capture more water and expedites rebuilding permits for power plants damaged by wildfires.”

Localities have braced for the new, unprecedented groundwater regulations as officials have been dispatched to implement and enforce them. “They are under orders to begin actively managing underground aquifers that for generations have been treated as a private resource, with property owners empowered to dig wells and extract as much water as they wanted without particular regard for their neighbors or government agencies,” the Sacramento Bee noted.

“But even amid the sobering accounts of dried-up wells, salt-tainted groundwater and collapsing aquifers in California farm country, no one expects regulation will be easy to set up or sell. Instead, the entire process — starting with just who gets to decide how much water can be ‘sustainably’ pumped in a region — is expected to spark lengthy debate and complicated lawsuits. This is particularly true in farm-rich regions such as Kings County, where the groundwater basins are critically overdrawn.”

Some farmers face the prospect of having to simply cease operations after a relatively brief period of time. “Land retirement is coming to California agriculture. The drought will end someday, maybe even this winter, but farmers will still face long-term shortages of water,” the Bee observed separately. “The relentless groundwater pumping that has kept hundreds of farms going the past four years is coming to an end.”

Meanwhile, other parts of the state have wound up with a large surplus of water, thanks to the uniformity of conservation regulations. “Unlike other parts of California, San Diego has 99 percent of the water needed for normal usage. But statewide conservation mandates have applied equally to areas that have plenty of water and those that don’t, so the result here has been water piling up unused while local water agencies raise rates to make up for lost sales,” according to the Los Angeles Times. “The new supply is just one more reason local water officials are advocating for the state to ease conservation mandates for areas where supplies are ample, which would lessen the oversupply.”

Originally published by CalWatchdog.com

CARTOON: Brown Tractor Pull

Brown tractor pull cartoon

Feds give California funds for drought aid, restoration

As reported by the Associated Press:

SACRAMENTO, Calif. >> Federal officials said Wednesday another $150 million would be provided to aid California drought aid programs.

U.S. Secretary of Agriculture Tom Vilsack said the funding continues efforts to relieve the nation’s top agriculture producing state during its fourth dry year.

The funding includes:

• $130 million to support conservation and restoration along the Sierra Nevada and its surrounding forests. The snow on the mountains usually provides a third of California’s water, though it’s virtually gone this year. …

Click here to read the full article

 

Public Outrage Over Uneven Water Cutback Mandates

Shower head water droughtA cascade of new water regulations has brought the drought home to millions of residents across California, cutting into their indoor and outdoor use and, often, prompting an outcry. But the impact of the regulations, handed down at different levels of government, has become significantly uneven, sowing the seeds of further controversy as the cutbacks continue with no end in sight.

Transforming landscaping

Following on Gov. Jerry Brown’s executive order mandating swift and sustained reductions in water usage, California regulators brought yet another type of consumption to heel. “The state Building Standards Commission voted to change development rules to reduce the demand for water,” the Associated Press observed. “Developers can meet the rules by planting shrubs and bushes instead of grass or installing slow-trickling valves instead of traditional sprinklers.”

Regulators expected the decision to bring significant savings — about 20 percent less across all California lawns. “Outdoor irrigation,” noted the AP, “accounts for roughly half of residential water use.” By the middle of June, residences, workplaces, schools and hospitals will all be subjected to the new strictures.

Riparian regulations

The curbs on thirsty lawns followed fast on sharp new demands imposed on historic farms by the State Water Resources Control Board. In an unprecedented move, a group of farmers recently offered to reduce their consumption by 25 percent relative to 2013 levels. Now, regulators have accepted the plan.

“The action applies only to so-called riparian rights holders, landowners whose property has direct access to a river or stream,”reported the Los Angeles Times. “By volunteering the cuts, Delta farmers avoid the risk of being hit with even larger cutbacks mandated by state water regulators.” According to the Times, the move brought one especially precious form of relief, taking away “the threat of lengthy and divisive litigation in a time of crisis.”

But not all farmers have accepted the new status quo. Some, reported the Contra Costa Times, hired attorneys “to assert that the state is defying statutes that honor their seniority. The water board’s order exceeds the scope of the state’s authority, the lawyers contend.” Farmers complained that they were pushed to offer a deal in order to avoid Draconian, potentially devastating penalties. And the state’s order that rights claimants show proof of property ownership has touched off an angry scramble for documentation.

“To defend their place in line, senior rights holders have rushed their ancient documents to analysts in the Division of Water Rights in Sacramento,” according to the Contra Costa Times. “Who, where and what rights will be curtailed in coming weeks remains to be determined, water officials say. Cutoffs will be based on flows in the watershed — and how long rights have been held.”

Local outrage

Meanwhile, in areas where cutbacks have already been adopted, some water agencies have moved ahead with even sharper penalties for current levels of use. San Jose Water, a private company supplying much of Silicon Valley with drinking water, followed the lead of nearby Santa Cruz and mandated steep new reductions in residential water consumption. As the San Jose Mercury News reported, “the company announced it would give all single-family residences — defined as any home that has its own water meter — monthly water allocations requiring a 30 percent reduction from 2013 levels. Apartments and most businesses won’t receive them.”

One detail in particular provoked a public outcry: “The 30 percent cut isn’t based on each home’s individual use. Instead, it’s calculated on the month-by-month average of all residential users in San Jose Water’s service area.” Company officials endured an hours-long hearing that drew some 350 dismayed locals, but remained — like officials across the state — largely unmoved. “It’s not like the spigot is going to go dry,” said Palle Jensen, senior vice president for regulatory affairs, according to the Mercury News. “You can still use water. But you will have to decide how.”

Originally published by CalWatchdog.com

Drought: Californians must demand better for the state

agriculture“Science,” wrote the University of California’s first President Daniel Coit Gilman, “is the mother of California.” In making this assertion, Gilman was referring mostly to finding ways to overcoming the state’s “peculiar geographical position” so that the state could develop its “undeveloped resources.”

Nowhere was this more true than in the case of water. Except for the far north and the Sierra, California – and that includes San Francisco as well as greater Los Angeles – is essentially a semiarid desert. The soil and the climate might be ideal, but without water, California is just a lot of sunny potential, but not much economic value.

Yet, previous generations of Californians, following Gilman’s instructions, used technology to build new waterworks, from the Hetch Hetchy Dam to the L.A. Aqueduct and, finally, the California State Water Project and its federal counterpart, the Central Valley Project. These turned California into the richest farming area on the planet and generated opportunities for the tens of millions who came to live in the state’s cities and suburbs.

Today, California operates on very different assumptions. If growth was valued under the regimes that existed in the 100 years after Gilman, it began to lose its allure in the 1960s and 1970s. Part of this was understandable; much of the state had developed haphazardly, and, particularly in the urban areas, not enough open space was left behind. The greens thrived most here because so many had witnessed the dramatic transformation of so much of the state.

The central figures in this transformation are the Browns. The father Pat was a builder by proclivity, and he made sure Californians not only had lots of water, but excellent roads and a great education system from grade schools and community colleges to the University of California. Brown epitomized California’s opportunity era, with its many excesses but also remarkable social mobility, less poverty and more equality than what we see today.

Jerry Brown, his son, was much the opposite. As his adviser Tom Quinn explained to me 30 years ago, Brown’s politics were informed by an abhorrence of what he called his father’s “build, build, build thing.” Brown Jr., he added, was not just rejecting his father, but a long line of Democrats – from Harry Truman to Lyndon Johnson and Hubert Humphrey – who saw the party’s mission as creating wealth and opportunity for their middle- and working-class constituents.

Brown’s approach, in contrast, has been to embrace the notion of “an era of limits,” sometimes for good cause: On nonproductive, runaway government spending, for example. But the lack of investment in infrastructure – as opposed to social services, pensions and salaries – caused disastrous results, of which the current severity of the drought is just one example.

Part of this is world-view. Although generally scientists reject the claim that the drought stems from climate change, Brown and his amen crew, such as at the New York Times, swear that it’s a big part of the story.

This narrative helps explain why the state, under increasingly strong environmentalist influence, has chosen to refrain from taking steps to mitigate the drought. If it’s part of a general revolt of “gaia,” after all, why bother? Better to don a hair shirt and shrink the consuming base than prepare to meet future demands.

Brown’s distaste for adding storage space – a sentiment shared by his core green backers – goes back to his first two terms. Recently, he seems to have wised up on the need to deal with water infrastructure, but he has been careful not to offend his green allies. He has not called for an end to the unconscionable mass diversion of water to San Francisco Bay to restore ancient salmon runs and to save the Delta smelt. This inaction has helped make the current drought – which recalls at least two others I have experienced over the past 40 years – far worse than it need be.

But Brown’s water policies are only part of broader systemic problem in the political economy. The state’s politics are now dominated by a coalition of environmentalists, wealthy coastal residents and public employees who have little interest in broad-based growth, particularly in the state’s interior. This is reflected not just in water polices, but in such areas as basic transportation infrastructure. During the recession, for example, California cut transportation spending far more than states like Texas. A recent study from the American Association of State Highway and Transportation Officials and a nonprofit group found that California was home to eight of the 20 urban areas with the worst roads in the nation.

Brown’s disdain for infrastructure spending has survived the bad times and continues with the current budget. Similar trends are seen across the state, including even in opposition to building capacity at the ports – leading to a gradual erosion of our dominant market share to competitors, particularly in the Southeast. Some cities invest in expensive rail development but fail to keep up with the more cost-efficient bus service.

Similarly, a commitment to Draconian “renewable energy” goals has helped line the pockets of Silicon Valley investors and utilities at the expense of manufacturers, Main Street businesses and households. And when it comes to new housing, the green regime has created conditions that make the purchase or rental of housing outrageously expensive.

In the process, California has gone from the 25th-worst state in terms of inequality in 1970 to fourth-worst in 2013. Sure, Silicon Valley companies, flush with investment cash desperate for returns, do well, as does high-end real estate. But the historic constituents of the Democrats – minorities, the poor, the working class – have gotten only crumbs, effectively sold out by their own clueless, and often corrupt, political class.

So in the Oedipal conflict between the Browns, it’s not hard to see whose legacy we should seek to emulate. Pat Brown left behind roads, schools and, most critically, a water system, all of which we still depend on. Jerry Brown has promoted his reputation as a climate crusader and architect of the collapse of the Republican Party. His legacy is tied to his high-speed choo-choo, even though many not profiting from the gravy train don’t think it’s a good idea. Indeed, many progressives, such as Mother Jones’ Kevin Drumm, consider the whole thing “ridiculous,” a massive boondoggle.

But unlike some of my conservative friends, I don’t think all the blame belongs to Brown and his Democratic allies. California business did not push hard for new state investment when GOP governors ran the state. In some cases, Republicans also turned against their own traditional support of infrastructure building, embracing an infantile notion that low taxes alone would solve all problems.

California’s mess has many progenitors outside the green machine. Big agriculture, which consumes upward of 80 percent of our water, has not exactly covered itself with glory, resisting ground water controls as they unconscionably pump critically depleted state aquifers to historically low levels. And some growers insist on planting crops like rice, alfalfa and cotton that are more suited to the wet southeast than arid California. Some cities did not meter their own water uses, encouraging waste even as the drought mounted.

So what do we do now? How about not using state law to say “no” to everything and start saying “yes” to the things most Californians need. The Right needs to get beyond its 1978 Howard Jarvis moment. The greens should clamber down from their mountaintop and start embracing a combination of solutions that includes not only conservation but more reservoirs and more desalination. Business has to accept fewer subsidies and a more intelligent selection of crops to adjust to the new reality. The public needs to accept that our houses need to have landscaping that looks more like Tucson than England.

But it’s more than just water. We also need to start saying yes to those things – natural gas electrical generation, new housing, better roads and buses – that actually would improve the lives of Californians. Caught between the clueless Republicans and the ecotopian fantasies of the Left, Californians need to reject both, and demand something better for this state.

Cross-posted at New Geography and Fox and Hounds Daily

Editor of NewGeography.com and Presidential fellow in urban futures at Chapman University

Jerry Brown, the Farmers’ Friend

Jerry Brown 1.0 stood up to farmers 40 years ago while Jerry Brown 2.0 is standing up for farmers during the current drought crisis. In 1975, to the consternation of many framers, Brown signed the Agricultural Labor Relations Act allowing collective bargaining by farm workers. In 2015, Brown’s mandated 25 percent cutback on water usage for most Californians that largely left the farmers alone.

On ABC’s Sunday Show, This Week, Brown responded to host Martha Raddatz’s challenge that farmers use 80 percent of the state’s water but do not have to cut back like other users.

“The farmers have fallowed hundreds of thousands of acres of land. They’re pulling up vines and trees. Farm workers who are very low end of the economic scale here are out of work. There are people in agriculture areas that are really suffering,” Brown said.

The state’s agriculture business is certainly hurting. Just last year California agriculture lost $2.2 billion from drought conditions. With the drought conditions continuing agricultural losses are expected at least the same this year.

State and federal water allocations have been cut to zero.

Brown took a broad view of California’s drought reminding Raddatz that the drought’s affect on farmers do not only touch people in the Golden State. “They’re not watering their lawn or taking longer showers. They’re providing most of the fruits and vegetables of America,” he said.

Farmers have been using water more efficiently over the last couple of decades. According to UC Davis professor Samuel Sandoval, “In the last 20 years, they’ve been increasing their efficiency between 10 and 12 percent.”

However, Brown made it clear that if the drought conditions worsen, even the farm country will be examined for ways to save water. For now the cutbacks will be aimed at coastal California and some of the state’s richer areas.

One side note that could be taken from all this, Brown clearly has a focus on the Central Valley. Whether you like it or not (and I don’t) his pet project bullet train was started in the Central Valley. And the Valley farmers will escape the initial water mandates.

Joel Fox is editor of Fox & Hounds and President of the Small Business Action Committee

Originally published by Fox and Hounds Daily