Watching the video series on American agriculture that the New York Times recently published reminded me that those of us who champion agriculture and rural America have a lot of work to do to overcome negative perceptions about what it takes to feed and fuel our world.  

Americans in communities large and small have for years been working to find common-sense solutions to climate change, and it is unnecessarily polarizing to have far left-leaning activists distract from this task by using false sensationalism to place blame for pollution solely on the shoulders of U.S. agriculture.  

The New York Times series is rife with inaccuracies, which even U.S. Department of Agriculture Undersecretary Robert Bonnie, formerly of the Environmental Defense Fund, called “horrible.”  

Using half-truths and outright lies to belittle the farmers and ranchers who provide us with a reliable and affordable supply of food is detrimental to our shared mission to protect the planet. So, let us set the record straight. 

U.S. agriculture accounts for less than 10 percent of GHG (greenhouse gas) emissions, according to the Environmental Protection Agency (EPA). This puts U.S. agriculture behind transportation (29 percent), electricity (25 percent), industrial (23 percent), and commercial and residential sources (13 percent). In fact, on a net basis, U.S. agriculture and forestry eliminate more GHGs than they produce, removing some 729 million metric tons of CO2 equivalent in 2017 alone.   

While beef cattle are often targeted for the methane they naturally emit, in reality, a recent government study concluded that U.S. beef cattle account for just 3.3 percent of GHG emissions. 

Despite their small share of GHG emissions, America’s farmers and ranchers have invested significantly in proven technologies and conservation management practices to protect our land, air, water, and wildlife while also further reducing GHGs. This includes no-till farming, the planting of cover crops, the introduction of biotechnology, the use of methane digesters, and even specially formulated cattle diets to reduce burping. 

In fact, over the last 70 years, U.S. agriculture has tripled production while usage of land, energy, fertilizer, and other inputs has remained fairly steady.  Moreover, roughly 140 million acres of farmland have been dedicated to conservation and habitat preservation objectives.   

The activists who on one hand say they want to slow or stop climate change, on the other hand are steadfast in their opposition to these innovations in agriculture.  

Let’s just be clear. If these so-called environmentalists were able to wave their magic wand and implement their pie-in-the-sky ideas, it would frankly jeopardize the food supply that ensures Americans seldom experience empty shelves and guarantee that food costs would skyrocket and become unaffordable to the average family who carefully budgets for their weekly meals.  

Activists in these videos deliberately conflate farms and ranches with large corporate food companies and meat packers in their attempts to sway public opinion. This sleight of hand is akin to purportedly giving you a glimpse into the lives of the average Amazon employee by showing images of Jeff Bezos’ yacht. It is an insult to our intelligence.   

A government report last year affirmed that 98 percent of farms and ranches are family-owned and even the small number of nonfamily farms are often made up of relatives and neighbors who opt to farm together. But we do not have to rely on statistics to be confident in this: a short road trip into rural America is all the evidence anyone needs.   

When confronted with these facts, environmental activists simply declare that everyone else is wrong and that the whole spectrum of political leaders — from Senators Elizabeth Warren (D-MA) and Bernie Sanders (I-VT) to former President Donald Trump and Senator Mitch McConnell (R-KY) — are in on the conspiracy.    

As the former Democratic Chairman of the House Agriculture Committee, I can tell you firsthand that they are wrong. Congress has been working alongside U.S. agriculture for years to enact voluntary, incentive-based initiatives to reduce and sequester GHGs and achieve other important environmental objectives.   

Farms and ranches are, in fact, already regulated under a vast number of environmental laws — ranging from the Clean Water Act to the Endangered Species Act. But to achieve even greater air and water quality, soil health, wetlands and wildlife protection, and other important public policy objectives, lawmakers from both sides of the aisle understand that we must partner with farmers and ranchers under the incentive-based conservation programs authorized under the Farm Bill.    

While environmental activists deplore the idea of voluntary, incentives-based programs, the Biden Administration has fully embraced the approach, recognizing that U.S. agriculture can not only reduce and sequester the small levels of GHGs emanating from the farm and ranch but can also offset significant GHGs from other sectors — an important realization given the ambition of cutting U.S. GHGs by fully 50 percent in just eight years.         

Meanwhile, opponents of common-sense farm policies would rather hunt for a solution in search of a problem by convincing the public that we cannot fix the climate problem until we fix American agriculture — even though it is American agriculture that holds the key to the solution they are seeking. 

That’s a shame.   

Collin C. Peterson

Member of Congress (1991-2021)

Former House Agriculture Committee Chairman

December 17, 2021

Former House Ag Committee Chair Collin Peterson is
our other choice for ag person of the year. Why? By far the
biggest policy threat to ag was the potential elimination of
stepped-up basis. Peterson couldn’t directly lobby but he
did pick up the pen and articulate to readers, including
lawmakers, how seriously damaging this would be. His opeds got a lot of traction. Sen. John Thune (R-S.D.) was a key
GOP point man on the issue and Rep. David Scott (D-Ga.)
eventually weighed in. But Collin got the ball rolling.
Peterson also forcefully argued that Democrats should not
mandate greenhouse gas or methane emission reductions
through Clean Air Act or new legislation, including the
social spending/Build Back Better (BBB) Act. He stated that it
would set back efforts by decades. And Democrats listened.

By Collin C. Peterson 

August 3, 2021

Stepped-up basis is not the target; the real threat is the transfer tax that would have to be paid to use stepped-up basis  

Like most everything else in Washington D.C., there is misinformation being put out either on purpose or because of a lack of understanding about what is going on with estate tax proposals. Most of the talk you hear in agriculture these days is how the “step up in basis” will be eliminated under President Biden’s American Families Plan. There are also issues facing us like treatment of capital gains, but that discussion is for another time.  

“Stepped-up basis” is a tax term that applies when property is valued at the amount it is worth when a benefactor dies and leaves the asset to the beneficiary, and not on the original value or basis. Farm assets like land are often passed down through generations of families, and therefore benefit from a step up in basis.  

The reality is, under the American Families Plan, stepped-up basis is not under threat of elimination, rather, the proposal would incur a transfer tax that would have to be paid in order to use stepped-up basis in the event of a sale or a death.  

When I was a CPA and sat across the desk from farmers giving advice on estate planning, we did not have to worry about the kind of issues facing us now. Things like the amount of exemption, tax rate and valuation issues were critical to the conversation, but nothing like what is being proposed with this transfer tax was ever on the table.  

Over the years we fought to get the estate tax exemption raised and to keep the step up in basis system, and the law is now a culmination of policies that work well for farmers. I would argue this transfer tax, which could be as high as 43.4 percent, is the worst idea that has been proposed in terms of its impact on agriculture in my lifetime. This proposal is a direct assault on agriculture because it will prohibit the transfer of a family farm from one generation to the next which is the last thing we should want to do.  

If this proposal becomes law, you could have a situation where upon the death of a farmer, his family will owe more than the equity that they have in the farm operation. Just the specter of that occurring would make it difficult for bankers to loan money, because there is no way to know what’s happening with the value of the operation and its assets.  

Back in 2017, we raised the estate tax exemption from $5 million to $10 million indexed for inflation (currently $11.7 million per taxpayer). After 2025, the exemption will revert back to little more than $6 million. While some people will want to make a big fight out of that, the reality is that keeping the system we have at that lower level would be significantly better than what is being proposed in the American Families Plan. The estate tax, whether at $6 million or $11 million, will affect only a select few. This transfer tax would affect virtually every farm family and bring uncertainty that diminishes their ability to attain credit. 

This transfer tax proposal doesn’t likely have a chance of passing the Senate under regular order. However, there is a danger that with the partisanship going on in Washington D.C., the proposal could go into a reconciliation bill without having anybody in the room who really understands the severity of this change and get passed into law.  

At the end of the day, those of us who support family farms and ranches have a big job on our hands making the case for why the tax system we fought for over the years should be maintained. We also need to educate Members of Congress who have good intentions but really don’t understand how devastating these changes would be to maintaining the family farm in America.  

We need to fight to keep the current estate tax system that we worked so hard to develop and convince policy makers to drop this idea of the transfer tax. If a change like this is adopted, agriculture as we know it will disappear and may never recover.  

Mr. Peterson is former Chairman of the House Agriculture Committee and represented Minnesota’s Seventh Congressional District as a Democrat from 1991-2021. He was one of the few CPAs to serve in Congress. He is President and Founder of The Peterson Group.