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Budget cuts could impact agriculture industry, food safety

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Amarillo, TX - Impending federal budget cuts could bring the meat industry grinding to a halt.  and that would hit especially hard in the Panhandle.

Back in January, Congress made a series of last-minute deals to stave off the impending 'fiscal cliff' for a few months, and now we're coming up fast on the new March 1 deadline.  And the White House says failing to meet that deadline would mean food shortages, higher prices, and a riskier food supply.

If Congress doesn't avert the cliff a second time, 1,200 food inspectors will be furloughed for 15 days.

In a memo released last week, the Obama Administration said doing so would result in billions of dollars in lost revenue, since without an inspector, food production comes to a halt.

"You're talking about employee losses, and wages, and benefits of up to $400 million. And that all trickles down to our feedyards, and our cow-calf operators, so you're talking about billions of dollars in losses for just a two-week loss of meat inspectors.  From our standpoint, any threat or disruption to that food chain life cycle is potentially devastating to the beef industry, and especially to our economy in Amarillo and the High Plains."

Texas is the number one beef producer in the nation, and the recent shutdown at the Cargill plant in Plainview demonstrates how much our area's economy depends on agriculture.

Even temporary shutdowns could raise food prices and cause shortages, which would pass the cost on to restaurants and groceries.  Wendy Saari of the Texas Restaurant Association says since the majority of restaurants are small owner-operated businesses, any rise in food costs would have a direct impact on the industry.

"Food costs have been rising over the past several years," Saari explains, "and restaurants tend to operate on razor-thin margins, so anything that has the potential to impact food costs, such as shutting down any kind of production facility, will have a big impact on the restaurant industry."

Congress still has two weeks to come up with a compromise before the cuts could take effect.

If you'd like to see the White House memo or get a few more perspectives on the issue, follow the links attached to this story.

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