Tuesday Roundup: Cut Rural Delivery?

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A columnist for the Los Angeles Times has an idea for how the Postal Service can get into the black. Stop delivering to rural areas. David Lazarus writes

Perhaps it’s time to do away with the postal service’s constitutional requirement for universal service. Perhaps it’s time to stop delivering to the sticks.

I know, I know: heresy. But think about it. The real problem here is costly rural delivery. So instead of having the mail man (or woman) visit every home everywhere, how about we set a geographic boundary for home delivery at some point on the outskirts of every urban area?

Far-fetched? Well, the head of the Postal Service spoke at the National Press Club yesterday and said he needs to cut $20 billion a year from annual costs running $75 billion. He wants the ability to close post offices — 25,000 of the 32,000 post offices operate at a loss — and lay off workers at his discretion.

“We’re in a deep financial crisis today because we have a business model that’s tied to the past,” said Postmaster General Patrick Donahoe. “We are expected to operate like a business, but don’t have the flexibility to do so. Our business model is fundamentally inflexible. It prevents the Postal Service from solving its problems.”

•The super committee is dead. What does that mean for the farm bill, which was part of the package being crafted behind closed doors?

DTN’s Chris Clayton wrote this morning that the bill “moved to legislative limbo…” The House and Senate ag committees had put together a bill that trimmed $23 billion (over ten years) from farm programs. 

Clayton notes that if the automatic cuts come into effect — automatic cuts were to be the price paid if the super committee failed — between $14 to $16 billion would be cut from ag programs.

The chairs of the House and Senate committees say they will “continue the process of reauthorizing the farm bill in the coming months….”

They will do so, however, in a more open, traditional process — which is just fine with Senate Ag Committee Ranking Member Pat Roberts of Kansas. “In recent weeks, the chairs of the House and Senate Agriculture Committees have worked on a farm bill proposal, largely without my input and the input of the other members of the two committees,” Roberts complained in a statement. “The last proposal was so ‘secret’ that I still have not seen final legislative language and scores.”

Politico’s David Rogers describes the political factions lining up as the farm bill debate moves on. He reports that cotton interests have decided to move ahead alone with a program designed just for that crop. (In older times, Rogers writes, cotton aligned itself with other Southern crops, peanuts and rice.) 

Rogers also describes a split between Great Plains farm interests and those in the Corn Belt in a new program that would insure revenues against precipitous drops in prices or production. Plains representatives wanted drops in production measured against the history of the farm. Corn Belt reps wanted production measured against a county average. In the Plains, the argument went, counties are large and land quality varies. That argument won.

Here is a Congressional Research Service report on the various farm bill proposals. 

• Rural residents are more prepared for disasters than are city dwellers. 

• The Federal Communications Commission says its plan to expand broadband coverage in rural areas will produce 50,000 jobs in the next six years. 

The FCC voted last month to create the “Connect America Fund” using fees collected on landline operations. The money (about $4.5 billion) will now go to broadband, mostly in rural areas.

• Ken Ward Jr. remembers the Farmington Mine Disaster, the Thanksgiving Week coal mine explosion that killed 78 miners at Consolidation Coal’s No. 9 mine 43 years ago. Photo above. 

The Farmington disaster spawned a massive rewrite of federal mine safety laws and spurred reforms in the United Mine Workers of America.

• Ag is in a “super cycle” of rich assets and profits, says David Kohl, a Virginia Tech ag economist. And that’s dangerous. 

He contends that the demand for corn is largely behind the recent farm boom. And if governments cut ethanol subsidies or mandates? 

• Now that the super committee is dead, what might happen to public education? The Congressional Budget Office projects that education funding (from the feds) would be subject to cuts of 7.8 percent in 2013 (the first year automatic cuts will be required). 

Already, 300,000 jobs in education have been lost since 2008, 54 percent of all job losses in local government. The CBO warns that some 227,000 more education jobs will be lost next year. 

 

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