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Sen. Pat Roberts Urges White House to Conduct More Comprehensive Cost Benefit Analysis of Proposed GIPSA Undue Preferences Rule

Tuesday, July 27, 2010

(American Meat Institute)

“Simple cursory analysis in order to validate an agency’s pre-determined policy position is not in the best interest of our country,” said Sen. Pat Roberts (R-Kan.) in a letter to Cass Sunstein, administrator of the White House Office of Information and Regulatory Affairs.  Roberts was referring to the Grain, Inspection, Packers and Stockyard Administration’s (GIPSA) proposed rule that would place certain restrictions on how livestock are marketed.

“I have strong concerns that the Administration’s cost-benefit analysis (CBA) of proposed changes is inadequate,” Roberts wrote.  “Given the potential impacts of the proposed rule on livestock and poultry producers, processors and consumers, I believe it is critical that a robust and comprehensive CBA is conducted to ensure that all affected stakeholders have a firm understanding of the potential consequences of this regulation on their economic welfare and livelihood.”

Roberts noted that GIPSA’s CBA never referenced costs to consumers. In addition, he said it overlooks the potential for producers who currently receive a premium for operating efficiently and producing higher quality livestock and poultry to lose income due to an erosion or elimination of marketing options for their livestock.

Roberts pointed to a 2007 GIPS Livestock and Meat Marketing Study which showed that over 10 years, a 25 percent reduction in alternative marketing arrangements would cost feeder cattle producers $5.1 billion; fed cattle producers $3.9 billion; and $2.5 billion for consumers. If marketing arrangements were eliminated, the 10-year cumulative losses for producers and consumers would top $60 billion. Feeder cattle producers would lose $29 billion; fed cattle producers would lose $21.8 billion; and consumers would lose $13.7 billion.

“I urge the Administration to look deeper into the proposed rule and provide the public with a better understanding of its potential impact on their daily lives and pocketbooks,” Roberts concluded.

To view Roberts’ letter, click here: http://www.meatinstitute.org/ht/a/GetDocumentAction/i/61331

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