Tuesday’s historic election of Barack Obama as the country’s 44th president promises big changes in U.S. domestic and foreign policy, prompting many in the fertilizer business to ponder just what an Obama presidency means for them and their industry.
The election’s evolution and outcome was remarkable in many ways, with Obama usurping initial Democratic front-runner Sen. Hillary Clinton, and Sen. John McCain emerging as the Republican nominee after a listless campaign start that made him seem a long shot against opponents like former Massachusetts Governor Mitt Romney and former New York City Mayor Rudy Giuliani.
Also remarkable was the global response to Obama’s election, with scenes of celebration replayed from around the world in the hours after U.S. polls closed. Even Green Markets received unsolicited emails from foreign contacts expressing their congratulations and admiration for the American electorate.
As for certain members of the fertilizer and agrichemical industries, some of whom gathered as recently as September for a Seattle conference that featured an enthusiastically received keynote address by Republican strategist Karl Rove (GM Sept. 15, p. 1), the response was reserved but cautiously hopeful.
“We talked to both candidates’ ag teams prior to the election, so we have already engaged [Obama’s] campaign staff expressing our concerns,” said Kathy Mathers, vice president of public affairs for The Fertilizer Institute. “We have a running start with these folks. As Ford (TFI President Ford West) likes to say, ‘We don’t elect them, we just work with them.’ So that’s the bottom line.”
Chief among TFI’s concerns, Mathers told Green Markets, are energy issues such as natural gas drilling on the outer continental shelf, and climate change proposals centered around a national cap and trade system, which would put a ceiling on greenhouse gas emissions using a fixed quota of tradable emissions credits in order to drive investments in low carbon technologies.
Obama expressed support for the latter during the campaign, saying his policy would be more aggressive than any other cap and trade system proposed. As for drilling on the outer continental shelf, Obama eased his stance in the wake of record high gas prices this summer, but has repeatedly said America “can’t drill its way out of the energy crisis.”
“Whether it was McCain or Obama, ultimately some sort of climate change action will take place,” Mathers observed. “Whether that’s sooner or later depends on how soon the economy recovers.”
Mathers noted that Obama is “bullish on biofuels,” which she acknowledged is a plus for agriculture and the fertilizer industry. Mathers also commented on Obama’s support for the 2008 Farm Bill (GM May 26, p. 1), a five-year, $307 billion legislative package signed into law last spring despite opposition from President Bush. McCain had also rejected the bill as being too expensive and bloated with earmarks.
Richard Gupton, vice president of legislative policy and counsel for the Agricultural Retailers Association, also noted Obama’s farm-state background. “He’s supportive of the Farm Bill and biofuels, so there could be some benefits,” Gupton told Green Markets. “They seem open to working with industry, so we’ll take it one day at a time.”
ARA has also met with Obama staffers to discuss key issues. Like Mathers, Gupton expressed reservations about Obama’s support for cap and trade proposals. “It could really shoot up energy prices, and if you’re talking about emissions from a fertilizer manufacturing facility, it could really hammer them with additional costs,” Gupton said. “Some heavy handed environmental regulations could be of concern.”
Both Mathers and Gupton said they are watching Obama’s cabinet picks with keen interest. Gupton referred with concern to reports that Robert F. Kennedy Jr. is on a short list of candidates to head EPA. Kennedy founded and now chairs an environmental group called the Waterkeeper Alliance, serves as an attorney at the Natural Resources Defense Council, and is a professor of environmental law at Pace University School of Law.
“If he appoints Robert Kennedy as head of EPA, we’re in for a tough road,” Gupton said, noting Kennedy’s aggressive stance on chemical facility security issues in the past.
Other names reportedly under consideration for the EPA slot include former Sierra Club president and environmental activist Lisa Renstrom; California Air Resources Board chair Mary Nichols; Pennsylvania Department of Environmental Protection Secretary Kathleen McGinty; and Massachusetts Energy and Environmental Affairs Secretary Ian Bowles.
Fertilizer industry participants may also note that New Jersey Democratic Governor Jon Corzine has been mentioned as a possible pick for Treasury Secretary, though some pundits, and Corzine himself, have downplayed the rumors. As a former Democratic senator from New Jersey, Corzine championed early efforts at chemical facility security regulations that were opposed by TFI and ARA as being too stringent.
Members of the Natural Gas industry expressed optimism about an Obama presidency last week. “President-elect Obama has announced his support for increasing American natural gas production as part of his energy agenda. We will work with his administration to ensure new supplies of clean-burning, American natural gas,” said Barry Russell, president and CEO of the Independent Petroleum Association of America. “We also look forward to working with him on the federal resource leasing process, including the recently expired offshore moratoria and the necessity of acquiring new leases.”
Added R. Skip Horvath, president and CEO of the Natural Gas Supply Association: “If the Obama administration and Congress follow through on their campaign promises to rely on more renewables to make electricity, natural gas will prove extremely useful in enhancing the reliability of those fuels.”
Don Santa, president of the Interstate Natural Gas Association of America, referred to comments made in August by Obama in support of a natural gas pipeline from Alaska to the lower 48. “He recognized that such a project will deliver a clean, domestic fuel and create good jobs here in America in the process. We’re excited to work with him on that effort,” said Santa.
In the meantime, the straw poll at CHS Inc., which traditionally predicted the winner in presidential elections, saw its first defeat. “We’ve conducted these straw ballots on major national and statewide elections at our location for two decades as a way to encourage employee interest and get out the real vote on Election Day,” said Jim Bareksten, director, government affairs. CHS released the results on Nov. 3. “Each time, our employee vote has mirrored the actual outcome – including the election of Jesse Ventura as governor in 1998.” The election, which also included employees at the company’s Rosemount, Minn., transportation terminal, drew 153 voters. In the presidential contest, McCain drew 57 percent of the votes to Obama’s 43 percent. In the Minnesota senate race, the poll gave Republican Norm Coleman 57 percent to 33 percent for Democrat Al Franken and 10 percent to independent Dean Barkley. At press time Coleman was leading by just over 200 votes, with the results in the midst of a recount.