Proposal for Decriminalization of Medicinal Marijuana Could Lead to Economic Boom for State of Kentucky

By: Samuel Jones, Staff Member

Just as the smoke cleared from the illuminating display of fireworks, another firestorm erupted in Frankfort, KY, this time involving a much different type of smoke.  Senator Perry Clark (D-Louisville) unveiled legislation to legalize the use of medicinal marijuana, and permit possession of small amounts of it without risk of criminal infraction.  Senator Clark wanted to get an early start promoting the legislation to make marijuana available by prescription to cancer patients and others who would benefit from the "miracle plant."

[1]

The proposal explicitly states that it relates only to medicinal usage of marijuana, and allows for the creation of various statutes under KRS 218A, the Controlled Substance section of the KY Revised Statutes, to reduce the illegality of marijuana possession to a Schedule II drug, the same level as opiates, salts, and coca leaves.

[2]

  Though Clark himself  and many others see the passage of this bill as a long shot, Kentucky would become the 19

th

state (including D.C.) to legalize the use of marijuana, and thereby open the floodgates to a whole new industry that is turning significant profits.

[iii]

 While there are political, moral, and personal elements to this issue, the economic and agricultural aspects should not go unnoticed.  Given Kentucky’s temperate climate, high precipitation, and large amounts of arable land, this state is prime real estate for marijuana growth.  This makes it relatively easy for individuals to grow private stashes and doubly hard for law enforcement to control and eliminate its illegal production. In fact, in the 2010 KY Crime Report, over 34% of drug related arrests involved marijuana use or possession, and law enforcement has seen substantial increases in those amounts already.

[iv]

The high amount of costs required to arrest offenders, charge and litigate cases, house convicted criminals, and provide rehabilitation costs no doubt takes a heavy toll on the state budget.  In 2011, Kentucky’s General Assembly voted to reduce the charge of marijuana possession from a class A misdemeanor to a class B misdemeanor, reducing the jail sentence from a maximum of 90 days down to 45 days.

[v]

This was likely done to provide some relief to the heavy costs required to equip state officials in the war of illegal drug use and trafficking.  It is obvious that battling illegal marijuana use is becoming expensive, so legislators are beginning to find new ways to reduce the costs of enforcing drug policy and possibly tap into the trending market.

Aside from easing the burden levied on tax payers for law enforcement, harnessing the possible industry of marijuana growth could also provide financial relief to a struggling economy.  Other states that have legalized medicinal marijuana use have seen economic gains from marketing this drug that has demonstrated positive physical effects.   It is estimated that Californians alone spend roughly $1.4 billion on medicinal marijuana, a large portion of that reverting back to the state government in forms of permits, licenses, and sales taxes.

[vi]

 In Colorado, the state collected $5 million in sales tax from medical marijuana distributors last year, more than doubling the revenue from the 2010.

[vii]

   With state funded institutions facing funding cuts and the rising number of arrests associated with marijuana possession, the state legislature needs to thoroughly examine all avenues of possible fundraising, one of those methods being the rising marijuana industry.   

The decriminalization of medicinal marijuana will likely be a hot topic during the next session of the Kentucky General Assembly.  The political debate is sure to cause divisions among the state residents, but the agricultural statistics are promising, as evidenced by other states that have legalized this type of use and seen financial gains.  A thorough analysis of the potential agricultural and economic boom that could come to Kentucky after the legalization of marijuana should certainly be included in the legislative discussion.

[1]

Roger Alford,

Sen. Clark Moves to Legal

ize Medical Marijuana

,

Lexington Herald-Leader

, July 5, 2012, 

http://www.kentucky.com/2012/07/05/2248986/clark-prepares-to-unveil marijuana.html#storylink=misearch

.

[2]

2012 Bill Tracking KY S.B. 129;

See

KY. REV. STATE. ANN. §218A.070 (LexisNexis 2012).

[3]

17 Legal Medical Marijuana States and DC: Laws, Fees, and Possession Limits

, ProCon.org (July 7, 2012, 

10:30PM) 

http://medicalmarijuana.procon.org/view.resource.phpresourceID=000881#California

.

[4]

2010 Commw. of Ky. Crime Rep

. 102-104,

http://www.kentuckystatepolice.org/pdf/cik_2010.pdf

.

[5]

Assembly Ends Marijuana Arrests

, THE STATE JOURNAL (Mar. 6, 2011), http://www.state-

journal.com/citizen%20news/2011/03/06/assembly-ends-marijuana-arrests.

[6]

Rober A. Mikos,

A Critical Appraisal of the Department of Justice's New Approach to Medical Marijuana

22 

Stan. L. & Pol'y Rev

633, 655 (2011). 

[7]

Michael Cooper,

Struggling Cities Turn to a Crop for Cash

,

N.Y. Times

(Feb. 11, 2012)

http://www.nytimes.com/2012/02/12/us/cities-turn-to-a-crop-for-cash-medical-marijuana.html

.

Increased Bicycle Use Means It Is Time to Revisit Vehicle Laws

By: Robert Proudfoot, Staff Member

With environmental advocates pushing for bicycling as an alternative to automobiles through new users and Bike Share programs, bicycling laws become more important as way to eliminate safety risks and provide standards of conduct for predictable road use.  Currently, t

he state and local laws for bicyclists are ambiguous; sometimes they are motor vehicles or other times pedestrians.  In some states, bicyclists are not subject to

violations for driving under the influence laws (“DUI laws”) while theses laws apply in other states.

[1]

  Further, state uninsured motorist insurance coverage does not apply to accidents with bicyclists.

[2]

  For traffic violations, some courts have ruled that bicycles are “vehicles” and subject to traffic laws.

[3]

  This piecemeal approach for bicycling serves to muddle the regulatory environment and create uncertainty as to the rights and duties of all road users.

Bicycle advocates have long debated

whether a bicycling should be considered use of a vehicle or not under state law.

[4]

The United Kingdom struggled with this ambiguity more than a hundred years ago when it defined a bicycle use as a “carriage” in regulation.

[5]

  By placing bicycles into an already defined category of vehicle, it required riders to have a “lamp” and give an audible signal for passing.

[6]

An Oregon case,

State v. Potter

, exemplifies the strained application of vehicle definitions to bicycling in the United States.

[7]

  In that case, a bicyclist was cited for a traffic violation but appealed the decision on the basis that the relevant law only applied to “motor vehicles” and not “vehicles.”

[8]

  The court agreed that the law was only for “motor vehicles” but held that another statute gives a bicyclist the “

same rights and duties as the driver of any other

vehicle” which includes motor vehicles.

[9]

  The court ruled that the bicycle, even though it was only a vehicle, had to follow the motor vehicle traffic law in question

.

[10]

In California, bicyclists also have the same rights and duties as drivers of motor vehicles.

[11]

Bicycle lanes are regulated separately in different states as well.

[12]

  In California, it is considered another lane of traffic that automobiles must cross to turn right, similar to bus lanes.

[13]

  In Oregon, automobiles must yield to a bicycle lane behind them before making any turns.

[14]

   While Oregon’s law is meant to protect bicyclists from right-hook accidents from turning automobiles, collisions still occur and the law has confused some.

[15]

Bike share programs implemented in places like New York City, Washington, D.C., and Miami have further complicated the issue.

[16]

  In these cities, there is an increasing amount of first-time or casual bicyclists. This group may not understand the fact that while bicycles are not legally defined as motor vehicles, bicyclists are required to follow traffic laws as a vehicle.

[17]

  The new riders ride on sidewalks, go down one-way streets the wrong way, and slalom in and out of traffic unpredictably.

[18]

New York City just recently started aggressively issuing tickets to commercial bicyclists, such as food delivery or messenger persons, for riding on the sidewalks, violating traffic laws, and unsafe riding.

[19]

  In Florida and most other states, even though a bicycle is considered a vehicle under state law, a bicyclist has the right to ride on a sidewalk.

[20]

As public officials struggle to define a bicycle’s official legal status on roads and sidewalks, tensions between bicyclists, automobiles, and pedestrians are on the rise. The legal issue and conflict will continue as bicycling increases in popularity as an environmentally friendly alternative.

[1]

State v. Johnson

, 203 N.J. Super. 436, 438, 497 A.2d 242, 243 (Ch. Div. 1985) (bicyclists cannot violate driving under the influence laws for motor vehicles);

Contra

State v. Tehan

, 190 N.J. Super. 348, 351, 463 A.2d 403, 404 (Ch. Div. 1982);

N.J. Stat. Ann

. § 39:1-1 (West 2009) (excludes bicycles from a motor vehicle definition for driving under the influence violations).

Compare

City of Montesano v. Wells

, 79 Wash. App. 529, 533, 902 P.2d 1266, 1268 (1995) (held bicycles are not motor vehicles);

Wash. Rev. Code Ann

. § 46.61.502(1) (West 2012) (The statute states that driving under the influence applies if “a person drives a vehicle” which contradicts the court’s interpretation of it applying only to “motor vehicles”).

[2]

Chong v. California State Auto. Assn.

, 48 Cal. App. 4th 285, 288, 55 Cal. Rptr. 2d 648, 650 (1996)(holds bicycles are not motor vehicles as defined by state insurance law);

Cal. Ins. Code

§ 11580.06 (a) (West 2012) (defines “motor vehicles”);

See also

9 Couch on Ins. § 123:23 (3d. ed. 2011).

[3]

Green v. Pedigo

, 75 Cal. App. 2d 300, 305, 170 P.2d 999, 1003 (1946) (when a bicyclist and motorist meet at an intersection, the person on the left must yield according to traffic laws).

[4]

Fred Oswald, Et  Al.,

“Bike = Vehicle?  To be or not to be?”.

Bikelaws.org

,

http://bikelaws.org/

(last visited July 16, 2012).

[5]

Local Government Act, 1888. § 85(1). (U.K.) (1888)

available at

http://www.legislation.gov.uk/ukpga/1888/41/pdfs/ukpga_18880041_en.pdf

.

[6]

Id

. at §§ 85(1)(a), (b).

[7]

State v. Potter

, 57 P.3d 944 (Or. App. 2002).

[8]

Id.

at 945-46.

[9]

Id.

at 945

[10]

Id.

[11]

Cal. Veh. Code

§ 21200(a) (West 2011);

See also

California Driver Handbook – Sharing the Road. California

Department of Motor Vehicles

.

http://www.dmv.ca.gov/pubs/hdbk/shr_slow_veh.htm#bike

(last visited July 15, 2012).

[12]

See

Bike Lanes & Right Turns

,

San Francisco Bike Coalition

,

http://www.sfbike.org/?bikelane_right_turns

(last visited July 15, 2012).

[13]

Cal. Veh. Code

§§ 21209(a); 21717 (West 2012).

[14]

Or. Rev. Stat. Ann. § 811.050

(West 2012).

[15]

Stuart Tomlinson,

Women’s Death throws spotlight on ‘right hood’ bicycle accidents

, 

Oregonian

(May 18, 2012,10:20 AM), 

http://www.oregonlive.com/portland/index.ssf/2012/05/bicyclists_death_throws_spotli.html

.

[16]

Alan Gomez,

Bike Sharing Stokes Conflicts Between Drivers, Cyclists

, USA TODAY (July 7, 2012),

http://www.usatoday.com/news/nation/story/2012-07-07/bike-share-programs/56068082/1

.

[17]

Id.

[18]

Ted Johnson,

An Arizona Hick Tries Capital Bikeshare

,

CommutebyBike.com

(June 28, 2012),

http://www.commutebybike.com/2012/06/28/an-arizona-hick-tries-capital-bikeshare-part-2/

(at least one account of unsafe Bike Share users).

[19]

Matt Flegenheimer

,

In Fight Against Unsafe Delivery Cyclists, a Focus on Employers

,

New York Times

(July 13, 2012),

http://www.nytimes.com/2012/07/14/nyregion/new-york-going-after-unsafe-delivery-cyclists.html

.

[20]

Fla. Stat. Ann.

§

316.2065 (West 2012).

The Drought's effect on corn and its subsequent effect on meat prices

By: Toney Robinette, Staff Member  

The United States is currently facing the worst drought since 1956.

[1]

  The drought is causing several food crops around the nation to die in the field.  Corn is the nation's largest legal cash crop, with an estimated value of $76.5 billion in 2011, and this drop in production may cause serious price increases.

[2]

  Missouri and Indiana are also having poor or very poor crops in more than 70% of their corn yields.

[3]

  This significant drop in yield has caused prices to increase by 55% since June 15

th

.

[4]

  This means that corn prices have increased to $7.96 per bushel.

[5]

Because corn is such an integral part of industry and food production this could have a far reaching impact beyond what consumers pay for it at the grocery store.  Corn is an essential feed for several types of domesticated livestock like chicken and cattle.  It is also used in ethanol and as an artificial sweetener.  Its myriad of uses could cause costs to increase for companies such as General Mills, Coca-cola and McDonald's.

[6]

  This means that costs from meat, sweetener and even fuel could increase due to the drought.  While food prices typically only increase around 1% overall for every 50% increase in corn prices, other more attenuated food types see larger increases.  For example, meat prices could possibly increase by nearly 10% due to the drought's effects on corn yield.

[7]

This significant drop in production is also uniquely affecting the Commonwealth.  The USDA's weekly crop bulletin said the Commonwealth of Kentucky has been experiencing the worst effects on its corn crop with 77 percent of the crop being of poor or very poor conditions.

[8]

  The University of Kentucky's Forage Specialist Garry Lacefield says that one of the major effects of a drought on corn growth is the issue of nitrogen build up.

[9]

  Nitrogen is an essential element in the growth and development of corn but without any water the nitrogen is not converted into useful materials.  Corn is often used as feed for cattle but this nitrogen build up could possibly damage this crop's potential for use in cattle feed.  If the Commonwealth's corn fields do not receive enough water, the nitrogen levels could reach such a level that using the corn as feed could prove toxic to cattle.  While silage, a process in which corn is stored in a silo without drying, could lower nitrogen levels by 30 to 50 percent, it may still be toxic to many head of cattle.

[10]

  Lacefield recommends more nitrogen testing before administering the corn as feed but this could further increase already high meat prices.  On top of the already increased meat prices and the possible death of cattle due to nitrogen, Kentucky could also possibly see an increase in meat prices higher than anywhere else in the country.

[1] 

Angelo Young,

No Respite for US Crops; Kentucky Corn Hit Hardest,

International Business Times

(July 19, 2012), http://www.ibtimes.com/articles/364740/20120719/corn-prices-drought-2008-food-crisis-heatwave.htm.

[2] 

Luzi Ann Javier and Jeff Wilson,

Crop Prices Drop After Surging to Record on U.S. Midwest,

Bloomsburg Business Week

(Jul. 23, 2012), http://www.businessweek.com/news/2012-07-23/crop-prices-drop-after-surging-to-record-on-u-dot-s-dot-drought.

[3] 

Weekly Weather and Crop Bulletin

,

U.S. Dept. of Agriculture

 (Jul. 17, 2012),

http://www.usda.gov/oce/weather/pubs/Weekly/Wwcb/wwcb.pdf

[4] 

Supra

note 2.

[5] 

Hibah Yousuf,

Corn, Soybean Prices Shoot Up as Drought Worsens,

CNN Money

(Jul. 20, 2012), http://money.cnn.com/2012/07/19/investing/corn-soybean-prices/index.htm.

[6] 

Id.

[7] 

Hibah Yousuf,

Your Burger is About to get Pricier

,

CNN Money (

Jul. 18, 2012), http://money.cnn.com/2012/07/18/investing/corn-prices-food-inflation/index.htm?iid=EL.

[8] 

Supra

note 3.

[9] 

Angela Hatton,

Nitrogen Levels High in Drought Damaged Corn

, WKMS (Jul. 17, 2012), http://wkms.org/post/nitrogen-levels-high-drought-damaged-corn.

[10] 

Id.

Doping Horses

Image Source

By: Breck Norment, Staff Member 

Our hearts race when a fleet of horses tear down a dirt track while pounding their hooves in a rhythmic dance of speed.  While many of us love horse racing, we tend to get caught up in the madness at the tracks and forget about the welfare of horses.  But it is all too sobering to watch a horse fall during a race, because we know how that horse’s story will likely end.  Only in rare circumstances can injured horses survive, and many are put down before they are removed from the racetrack.    

Approximately 24 horses die each week at American racetracks.[1]  Although many unfortunate events can lead to the injury and ultimate death of a horse during a race, the use of various drugs during race-day could be one of the leading causes of this ever increasing problem.[2]  Some of the drugs given to horses include a substance secreted from the skin of a frog in South America that can numb pain and increase hyperactivity in a horse.[3]  When given to a horse on race-day, this can be a dangerous combination.        

This issue of horse doping dates back to the nineteenth century, but it has been relatively dismissed – until recently.[4]  Legislators and other racing industry figures have begun to push for some type of legislation to combat these dangerous practices.[5] 

Some of the industry’s leaders insist that Congress has the duty to step in with federal legislation to oversee the various types of drugs administered to horses at racetracks.[6]  Senator Tom Udall from New Mexico, who chaired the Senate Commerce Committee hearing, “proposed legislation to ban race-day medication” at racetracks.[7]  Sen. Udall expressed his concern with the use of painkillers and other drugs on horses on race-days.[8]  He explained that injured horses with masked pain continue to “charge down the track” and endanger everything in their path.[9]      

Others argue against federal legislation because they believe the federal government lacks the necessary “experience or expertise in horse racing.”[10]  As such, they argue that a coalition of states should enact a uniform set of rules for horse tracks to follow.[11]     

Perhaps the latter solution would be most favorable, but further federal government action may be required if the horse racing states cannot come to an agreement.  Either way, the sport must have rules designed to avoid these tragic deaths. 

---

[1] Walt Bogdanich, Joe Drape, Dara L. Miles, & Griffin Palmer, Death and Disarray at America’s Racetracks - Mangled Horses, Maimed Jockeys, New York Times (March 24, 2012), http://www.nytimes.com/2012/03/25/us/death-and-disarray-at-americas-racetracks.html?pagewanted=all.

[2] Id.

[3] Eliana Dockterman, Frog Juice:  Horse Racing’s New Doping Scandal, Time News Feed (June 21, 2012); see also, http://newsfeed.time.com/2012/06/21/frog-juice-horse-racings-new-doping-scandal/; See also Catherine Barrett, “Frog Juice” Has Legislators Hopping Mad, Ky. J. Equine, Agric. & Nat. resources L.Blog, (July 19, 2012), http://www.kjeanrl.com/.

[4] Id.

[5] Frederic J. Frommer, Need for federal oversight of horse racing debated, The Associated Press & Yahoo! Sports (July 12, 2012), http://sports.yahoo.com/news/federal-oversight-horse-racing-debated-183610459--spt.html.

[6] Id.

[7] Id.

[8] Jerry Bossert, New Mexico Senator pushing to end doping in horse racing, New York Daily News (July 12, 2012), http://www.nydailynews.com/sports/more-sports/new-mexico-senator-pushing-doping-horse-racing-article-1.1113554.

[9] Id.

[10] See Frommer, supra note 5.

[11] Id.

When are Wetlands Navigable Waters?

By: Joe Schuler, Staff Member 

In May 2012, the Supreme Court denied cert in a case from the Third Circuit addressing that very question.

[1]

In so doing, it left intact a 3-2 split among the circuit courts over the proper application of a prior Supreme Court ruling on the issue.

At issue is the Clean Water Act, which prohibits discharge of certain pollutants into “navigable waters” without a permit issued by the Army Corps of Engineers.

[2]

The Act defines “navigable waters” as “the waters of the United States.”

[3]

The Corps interprets the definition broadly, asserting its jurisdiction over traditional navigable waters, their tributaries, as well as adjacent wetlands.

[4]

That interpretation has led to challenges by property owners asserting that the Corps exceeded the scope of its authority under the Act. The Supreme Court considered that claim in

Rapanos v. United States.

[5]

A majority of the court was unable to agree on a proper test to establish when a wetland should be included in the scope of the Act as “waters of the United States,” leading to a 4-1-4 split.

In the court’s plurality opinion, four justices expressed the view that the approach of the Corps was overly broad.

[6]

However, the justices recognized the difficulty of defining the precise place where waters end and adjacent wetlands begin.

[7]

Accordingly, they reasoned that only wetlands with a “continuous surface connection” to bodies of water that are “waters of the United States” can be covered by the act as “adjacent waters.”

[8]

Justice Kennedy wrote an opinion in which he concurred with the judgment of the court, but expressed that the plurality’s opinion was too restrictive.

[9]

He believed jurisdiction of the Corps over a wetland should be upheld whenever there is a “sufficient nexus” between it and other “waters of the United States.”

[10]

Four dissenting justices would have deferred to the Corps, finding their approach to be “a quintessential of the Executive’s reasonable interpretation of a statutory provision.”

[11]

Since no majority agreed on a standard of analysis, lower courts have been left to wrestle with the appropriate test to determine when a wetland may be considered “navigable waters” within the meaning of the Clean Water Act. The Seventh and Eleventh Circuits ruled that Justice Kennedy’s “sufficient nexus” test to be the applicable test, finding that it was the narrowest position on which a majority of the justices would agree.

[12]

The

Donovan

court held that either the plurality’s “continuous surface connection” test, or Justice Kennedy’s “sufficient nexus” test would be sufficient to establish jurisdiction by the Corps, joining the First and Eighth Circuits.

[13]

This approach was suggested by Justice Stevens’ dissent in

Rapanos,

in which he declared that the four dissenting justices would join a decision where jurisdiction was upheld on either ground.

[14]

Therefore, either ground would enjoy support from a majority of the court.

Given that the Supreme Court declined to take up the

Donovan

case, it does not appear that the Court is in any hurry to resolve the split among the circuits. It seems then, that at least for the foreseeable future, the answer to the question of when a wetland is navigable waters will depend on its location.

[1]

United States v. Donovan

, 661 F.3d 174 (3d Cir. 2011), cert. denied 132 S. Ct. 2409 (2012).

[2]

33 U.S.C. § 1311(a) (1995); 33 U.S.C. § 1342(a) (2008).

[3]

33 U.S.C. § 1362(7) (2008).

[4]

33 C.F.R. § 328.3 (1993).

[5]

Rapanos v. United States

, 547 U.S. 715 (2006).

[6]

Id.

at 739.

[7]

Id.

at 740.

[8]

Id.

at 739.

[9]

Id.

at 778.

[10]

Id.

at 779.

[11]

Rapanos v. United States

, 547 U.S. 715, 788 (2006).

[12]

United States v. Gerke Excavating, Inc.

, 464 F.3d 723, 724 (7

th

Cir. 2006);

United States v. Robison

, 505 F.3d 1208, 1221 (11

th

Cir. 2007).

[13]

Donovan

, 661 F.3d at 181-82.

[14]

Rapanos

, 547 U.S. at 810. 

Coal Company Closures and the Future of Energy

By: Vanessa Rogers, Staff Member

Many utility companies have switched from coal to natural gas.

[1]

  More than 100 of the 500 coal-burning power plants in the United States are expected to close in the next few years.

[2]

  “Power plants that burn coal produce more than 90 times as much sulfur dioxide, five times as much nitrogen oxide and twice as much carbon dioxide as those that run on natural gas.”

[3]

   Sulfur dioxide causes acid rain; nitrogen oxides cause smog; and carbon dioxide traps heat in the atmosphere.”

[4]

Natural gas plants, on the other hand, emit almost no harmful toxins.

[5]

  Many blame the switch to environmental friendly energy on the tough environmental regulations that have been implemented.

[6]

 However, the Environmental Protection Agency (EPA) said that coal is still expected to generate more of the country’s electricity than any other fuel source.

[7]

Despite the dispute over why coal companies are shutting down, one thing is for certain, coal company closures caused many to lose their jobs.

[8]

  A month ago one of the world’s largest coal producers, Arch Coal Inc., said it would lay off about 750 workers in Kentucky, Virginia, and West Virginia coalfields.

[9]

  Almost 600 of those cuts are in Kentucky.

[10]

  Perry County has estimated a loss of about 30% of its mining jobs in the last year.

[11]

  There are predictions that the share of U.S. electricity coming from coal will fall below 40% for the year, the lowest since the forecasts that the government began collecting data in 1949.

[12]

So what does all of this mean for the future of energy?  “One of the big issues with the EPA rules is that with all these coal plants coming off-line in 2015, even if natural gas prices are reasonable we just don’t have the pipeline capacity to get it where you need it,” said Jeffrey R. Holmstead, a former assistant administrator for the U.S. EPA and current head of the Environmental Strategies Group of Bracewell-Giuliani, which advocates for the coal industry.

[13]

  Because natural gas has a much lower carbon emissions, it  can meet the recently-announced EPA proposed greenhouse gas standards while conventional coal plants could not, if the proposal passes.

[14]

  In addition, coal companies may take their businesses overseas.  Some coal producers, such as Arch Coal Inc., have already done so.  Overseas, coal power plants are being built faster than they are being abandoned in the United States.

[15]

[1]

Bruce Schreiner,

Mine Layoffs latest sign of Coal Industry’s Decline

,

LJWorld.com

(June 22, 2012), http://m.ljworld.com/news/2012/jun/22mine-layoffs-latest-sign-coal-industrys-decline/.

[2]

Erik Lipton,

Even in Coal Country, the Fight for an Industry

,

NY Times

(May 29, 2012), http://www.nytimes.com/2012/05/30/business/energy-environment/even-in-kentucky-coal-industry-is-under-siege.html?pagewanted=all.

[3]

Schreiner,

supra

note 1.

[4]

Id

.

[5]

Kari Lydersen,

Is Natural Gas Killing Coal?

Midwest Energy News

(April 17, 2012),

 http://www.midwestenergynews.com/2012/04/17/is-natural-gas-killing-coal/.

[6]

Schreiner,

supra

note 1.

[7]

Id

.

[8]

Id

.

[9]

Id

.

[10]

Id

.

[11]

Id

.

[12]

Bruce Schreiner,

Mine Layoffs latest sign of Coal Industry’s Decline

,

LJWorld.com

, http://m.ljworld.com/news/2012/jun/22mine-layoffs-latest-sign-coal-industrys-decline/ (June 22, 2012).

[13]

Lydersen,

supra

note 5.

[14]

Id

.

[15]

Lipton,

supra

note 2.

Crop insurance: The agricultural equivalent of the mortgage crisis?

By: Jocelyn Arlinghaus, Staff Member

Every five years, Congress promises to improve the agriculture industry in the United States through a new farm bill. The bill addresses competing challenges facing the agriculture industry, including devastating losses to American farmers as a result of crop failures and increasing government subsidies in order to keep these farmers in business, costing taxpayers millions of dollars in the process.

[1]

The Senate is currently considering the Agriculture Reform, Food, and Jobs Act of 2012, which proposes a series of resolutions to these ongoing problems.

[2]

Through the act, Congress seeks to expand the crop insurance system by creating a $3 billion per year subsidy that would cover any farm losses before crop insurance policies kick in, effectively “bailing out” both farmers and insurance companies. This will replace the existing direct payment system which paid out over $5 billion a year as part of a direct subsidy to farmers regardless of whether they actually planted crops.

[3]

While the possibility of cutting $23 billion in spending over the next ten years is enticing, critics argue that this system only creates new problems for the agricultural economy and will have a negative impact on the environment.

[4]

Congress introduced federal crop insurance in the 1930s in an attempt to recover the agriculture industry after the Dust Bowl devastated Midwestern prairielands.

[5]

The government provided small subsidies that covered farmers’ losses due to circumstances beyond their control such as bad weather or pests.

[6]

Through this program, farmers can purchase insurance coverage against poor yields and the decline in crop prices.

[7]

The government now spends roughly $7 billion a year to cover two-thirds of farmers’ insurance premiums.

[8]

Congress now proposes an increase in the program to $9 billion a year in coverage and suggests a “shallow loss” provision that will cover losses to a minimum of 10%, effectively subsidizing farmers’ insurance deductibles.

[9]

While government subsidies appear to be a necessity for farmers whose profits hinge upon the weather and a volatile market,

[10]

this proposal has sparked recent controversy among industry experts. Critics argue that the new crop insurance program will be just as costly to taxpayers as the direct payment program because the government will be effectively subsidizing the private insurance companies that provide coverage to farmers.

[11]

Further, critics suggest that the program will create serious environmental risks. Because the guarantee of a large insurance subsidy reduces the risk of profit-loss, farmers are encouraged to plant “fence to fence” and expand onto land that is unsuitable for farming in order to make more money.

[12]

Enticing farmers to plant on unsuitable land where failure is almost certain will cost the government and taxpayers millions when these crops fail to produce.

[13]

Millions of acres in the Midwest that were once used for hunting purposes and home to many species of wildlife will be turned into corn, soybean, and wheat fields.

[14]

The bill does not include the conservation measures that were in place under the direct payment program, so farmers are free to take extreme risks knowing that if they are not successful the government will compensate them for their losses.

[15]

It is a win-win situation for farmers at the expense of taxpayers and the environment. Indeed, it is difficult to conceptualize why a big business American farmer is granted a “subsidy” during hard times while similar aid would be labeled as a “bailout” in a different industry. Additionally, some farmers have complained that while this program will help corn producers who are more affected by natural disasters, it will do little to help rice and peanut farmers that do not encounter “shallow losses.”

[16]

Because the negative impact of increasing crop insurance subsidies cannot be ignored, Congress should consider a less extreme version of the program in which a base level of coverage will be offered to farmers free of cost, with the option to purchase additional coverage out of their own pocket.

[17]

This places more responsibility on farmers and less of a burden on the government to provide a bailout for poor business decisions. Without such large subsidies, farmers are still have other remedies. They can choose to purchase less insurance or farm more conservatively by planting later in the spring when the weather is less volatile.

[18]

Allowing an increase to crop insurance subsidies would be a tragedy for government spending, taxpayers, and American prairielands.

[1]

See

Ron Nixon,

Crop Insurance Proposal Could Cost U.S. Billion

,

The New York Times

(June 6, 2012) http://www.nytimes.com/2012/06/07/us/politics/bill-to-expand-crop-insurance-poses-risks.html?ref=farmbillus

[2]

Agriculture Reform, Food, and Jobs Act of 2012, S. 3240, 112

th

Cong. (2012).

[3]

Nixon,

supra

note 1.

[4]

Id.

[5]

Stett Holbrook,

Crop insurance a boon to farmers--and insurers, too

,

The Bottom Line on

MSNBC

http://bottomline.msnbc.msn.com/_news/2012/06/18/12240997-crop-insurance-a-boon-to-farmers-and-insurers-too?lite

(last visited June 19, 2012).

[6]

Id.

[7]

Nixon,

supra

note 1.

[8]

Id.

[9]

Holbrook,

supra

note 5.

[10]

Nixon,

supra

note 1.

[11]

Holbrook,

supra

note 5.

[12]

Nixon,

supra

note 1.

[13]

Id.

[14]

Id.

[15]

See

Holbrook,

supra

note 5.

[16]

Melissa Miller,

Proposed farm bill would end direct payments

,

Southeast Missourian

, (June 15, 2012)

http://www.semissourian.com/story/1860520.html

[17]

Holbrook,

supra

note 5.

[18]

Id

. 

Drought Impacts Passage of the Farm Bill

By: Raabia Wazir, Staff Member

The drought of 2012 is the worst that the United States has seen in decades, stretching from Ohio west to California and from Texas north to the Dakotas. Twenty percent of the nation is either in an extreme or exceptional stage of drought, according to the U.S. Drought Monitor.[1] The intensity of the drought has increased rapidly in July, with states like Illinois seeing the percentage of its land in the worst two stages of drought increase from 8% to over 70% over the course of a week.[2] The U.S. Department of Agriculture (USDA) has now designated 1,369 counties in 31 states as natural-disaster areas, extending low-interest loans and other federal aid to help struggling communities.[3]

No sector of the economy has felt the effects of the drought more acutely than agriculture. Close to 90% of the nation's corn and soybeans are in drought-stricken areas[4], resulting in a nearly 3 billion bushel cut in corn production of an anticipated 14 billion bushels.[5] Corn, soybean and other commodities prices have soared as a result, and now farmers and ranchers find themselves unable to afford feed for their livestock. The drought exacerbated already declining numbers of cattle in the U.S., and now the nation's cattle inventory is the lowest since the USDA began a July count in 1973.[6] Consumers are expected to feel the effects of the drought in the costs of dairy and meat, with beef prices expected to rise 4 to 5 percent.[7]

Farmers and ranchers are waiting anxiously for Congressional approval of the new version of the five-year farm bill, a massive piece of legislation that deals with agriculture and all other affairs under the purview of the USDA. To be sure, the Senate has approved their version of the bill[8], and the House Agricultural Committee has produced a bill for consideration notable for its $16.5 billion in food stamp cuts[9], but Republican House leadership threaten to duck any votes on the bill until after November elections to avoid a messy and divisive floor debate between the party’s most ardent conservatives who seek further reform and cuts and representatives of drought ridden farmers.[10] This would mean allowing the current law to expire September 30, 2012, an unprecedented move that would shake an already weakened industry.[11]

One likely resolution to this standstill is a one-year extension of current farm law with cuts in conservation programs to fund drought relief for livestock producers. House leaders hope that these concessions will provide leverage to negotiate comprehensive reform for the farm bill with the Senate.[12] Agricultural groups are unappeased, insisting instead on passage of the five-year bill. [13] Bob Stallman, president of American Farmland Trust stated, “A one-year extension offers our farm and ranch families nothing in the way of long-term policy certainty…we need clear and confident signals from our lawmakers.”[14]

Ultimately, it is clear that those most concerned with this issue have no patience for political maneuvering, but for politicians up for reelection, it’s much easier to vote for disaster assistance than a new farm bill.

____________________________

[1] Jim Suhr,

Report shows US drought rapidly intensifying

,

Associated Press

(July 26, 2012),

http://www.google.com/hostednews/ap/article/ALeqM5i5uDlVBlti6asOlsDiaC8UAVuorg?docId=0f2f31d2a90b4cfaa42d68f6522165d4

.

[2]

Id.

[3] Mark Drajem,

Disaster Aid Extended To 76 U.S. Counties As Drought Persists,

Bloomberg

(July 25, 2012),

http://www.bloomberg.com/news/2012-07-25/disaster-aid-extended-to-76-u-s-counties-as-drought-persists.html

.

[4]

Id.

[5] Steve Karnows,

USDA says drought will boost food prices in 2013

,

Associated Press

(July 28, 2012),

http://www.mydesert.com/article/20120729/BUSINESS/207290302/USDA-says-drought-will-boost-food-prices-2013

.

[6] Roxana Hegeman,

U.S. has fewest cattle in at least 4 decades

, Associated Press

(July 22, 2012),

http://www.clarionledger.com/article/20120723/BIZ/207230304/U-S-has-fewest-cattle-least-4-decades

.

[7] Karnows,

supra

note 5.

[8] David Rogers,

Congress delays farm bill as drought spreads

,

Politico (

July 23, 2012),

http://dyn.politico.com/printstory.cfm?uuid=11C54F89-11E4-41BC-B3A7-59CDDD91069A

.

[9] David Rogers,

Food stamp cuts fire up Dems on farm bill

,

Politico

(July 10, 2012)

,

http://www.politico.com/news/stories/0712/78375.html

.

[10] Jake Sherman,

GOP leaders may squash farm bill,

Politico

(July 12, 2012),

http://www.politico.com/news/stories/0712/78460.html

.

[11] Rogers,

supra

note 8.

[12] David Rogers,

A new twist in farm bill drama

,

Politico

(July 26, 2012),

http://www.politico.com/news/stories/0712/79023.html

.

[13] Jonthan Weisman,

Republican Leaders in Tricky Spot on Farm Bill and Drought Aid

,

N.Y. Times

, July 30, 2012, 

http://thecaucus.blogs.nytimes.com/2012/07/30/republican-leaders-in-tricky-spot-on-farm-bill-and-drought-aid/

[14]

Id.

Has Obama lost the coal states? The Courts v. The Industry

By: Jessica Durden, Staff Member

The embattled coal states, already stressed by the rise of the natural gas industry, were dealt another blow when the U.S. Court of Appeals for the District of Columbia Circuit upheld an Environmental Protection Agency (EPA) mandate to fiercely limit greenhouse-gas emissions.[1]

  The Court fully supported the EPA in its finding that rising carbon dioxide emissions from the coal industry and other utility providers have “likely been responsible for global warming over the past half century.”

[2]

  The ruling piggybacked on a 2007 Supreme Court ruling that the EPA had power under the Clean Air Act to regulate greenhouse-gas emissions.[3]

In a heated election year, such a dramatic ruling could hurt the incumbent President Obama in his election efforts.  Obama lost Kentucky and West Virginia, two major mining states, in 2008.[4]

 Peppered along the highways in West Virginia are billboards declaring that the coal corridor is Obama’s “No Job Zone,” and West Virginia democrats have withheld support for the President because of his support for the EPA’s strict regulations.[5]

 The 2012 polls in mining states were not in Mr. Obama’s favor prior to this ruling, either.  In the Kentucky Democratic primary, 42 percent of registered and voting Kentucky Democrats voted for “uncommitted,” and in West Virginia a shocking 41 percent of state Democrats marked down a convicted felon’s name over Mr. Obama’s.[6]

  Kentucky’s primary vote result particularly shocked industry experts because there was not even another option on the ballot.[7]

These results are not entirely shocking, since Obama did not take these states in 2008 and was not projected to this year, but for a swing state like Ohio, this ruling could have maj

or implications. Presumed Republican presidential candidate Mitt Romney has already jumped on the opportunity to gain favor in coal-dependent Ohio by launching an energy-focused campaign in the state.[8]

  In an incredible streak, Ohio has picked the winner of the presidential election every year since 1964, and recent polls still put Mr. Obama ahead of Mr. Romney.[9]

  But this recent ruling gives Mr. Romney a strategic opening to appeal to the many industrial workers in Ohio struggling to get on board with the demands of the EPA.  If the Romney camp convinces Ohio, it is possible to win the state—and therefore win the nation in November.

[1]

Brett Kendall

,

Court Backs EPA on Warming

,

Wall. St. J.,

June 26, 2012, at A1.

[2]

Id.

[3]

Id.

[4]

Election Results 2008

,

N

Y T

imes,

(Dec. 9, 2008), http://elections.nytimes.com/2008/results/president/map.html.

[5]

M

ark Caserta,

Will W.Va. become an Obama “no-job” zone?

,

Huntington Herald-dispatch

,

(June 21, 2012), http://www.herald-dispatch.com/opinions/x1805694144/Will-W-Va-become-an-Obama-no-job-zone.

[6]

Aaron Blake,

Obama loses 40 percent of the primary vote in Arkansas, Kentucky

, (

Wash. Post,

May 22, 2012), http://www.washingtonpost.com/blogs/the-fix/post/obama-loses-more-than-40-percent-of-kentucky-primary-voters-to-uncommitted-option/2012/05/22/gIQAlYHEjU_blog.html.

[7]

Id.

[8]

See

Kendall

at A1.

[9]

Tom Troy,

Obama, Romney camps pull out all stops in Ohio

, T

oledo Blade

,( July 1, 2012), http://www.toledoblade.com/Politics/2012/07/01/Obama-Romney-camps-pull-out-all-stops-in-Ohio.html.