Congress targets food and gas inflation in new bill

The House of Representatives passed the Lower Food and Fuel Costs Act in a mostly party line vote. All but five Democrats voted in favor, and all but seven Republicans voted against. Supporters hope the bill will control inflationary costs.

To control food prices, the bill provides $500 million in USDA funds to help farmers lower their fertilizer use and other costs using a nutrient management assistance program. It also expands USDA loans so farmers can better utilize rural broadband and other agriculture technology to use fertilizers more efficiently. The loans allow for up to a 90% cost share for precision agriculture technology.

“By taking action to lower the cost on the farm, we lower the cost on the shelf in the grocery store and on the kitchen table,” Speaker Nancy Pelosi, D-Calif., said. 

The bill also creates a special investigator for the meatpacking industry to crack down on alleged anti-competitive practices, which Democrats contend is an especially big problem for the cost and quality of chicken. 

“Decreased competition, driven by market concentration, has allowed companies to further drive up costs and their profits – at the expense of hardworking Americans in one of our most vulnerable moments,” David Cicilline, D-R.I., said. 

There are also measures included to reduce gas prices by allowing the year round sale of gasoline with a 15% ethanol blend. Lawmakers estimate that will save drivers an average of 40 cents per gallon. 

“Once fully implemented, that could put an extra 8 billion gallons of homegrown American fuel into the supply chain. That is gonna have a big impact on gas prices.” Rep. Dusty Johnson, R-S.D., said. 

The year-round sale of fuel with high ethanol blends will require improvements to infrastructure. The bill provides $200 million in grants for gas stations and transportation companies to either install or retrofit pumps and storage tanks. While ethanol fuel is cheaper, it needs special storage because it evaporates very quickly, making it even more flammable, and it absorbs water which is terrible for engines. Ethanol also contains 30% less energy than pure gasoline, so it reduces fuel economy. 

The Senate still needs to give its stamp of approval before the act can be signed into law by the president.