News reports from across the country continue to signal that farm program cuts are a prime target in the current debate over the federal government’s $14 trillion debt that continues to swell daily.
From coast to coast, legislators from both sides of the aisle are looking to agriculture to help make up the financial short-fall. For instance, California lawmakers told reporters that they are willing to slice and dice ag budgets like never before.
Dairy programs are prime targets, too. According to the Wisconsin State Journal, Wisconsin’s Dairy Innovation Center has fallen victim to anti-earmark sentiment. Unless alternative funding is found, the center will cease operations next year, the newspaper reported.
And, The Tennessean recently reported that farm programs are a prime target because both Republican and Democratic lawmakers oppose them. The newspaper quoted Rep. Scott DesJarlais, a freshman Republican from Tennessee, who serves on the House Agriculture Committee. DesJarlais said “agriculture is no exception” when it comes to considering budget cuts.
The issue is becoming somewhat time sensitive. The Seattle Times reported that “farm subsidies nationally are under renewed scrutiny as the Obama administration and Congress negotiate federal budget cuts in advance of an Aug. 2 deadline for raising the federal debt ceiling.”
And an editorial Sunday in Tampa Bay Online proclaimed “if Congress is poised to make changes to Medicare, Medicaid and even Social Security, it is inconceivable that agriculture would not share in the sacrifice.”
Meanwhile, the budget axe has felled numerous state agriculture programs including this one in Oregon that helped fund anaerobic digesters on dairy farms. Or like these deep gashes to Pennsylvania’s cooperative extension service and ag research programs, much to the chagrin of the Pennsylvania Farm Bureau.
But the overall effect of some of these measures may be muted when it comes to the big picture. Cutting direct payments to farmers appears to save $4.9 billion per year in the federal budget. However, cutting that USDA program could boost farmer participation in ACRE, a program that offsets losses in farm income.
“Much of the budget savings from cutting direct payments could be offset by sharp increases in ACRE program expenditures,” says Pat Westhoff, director of the University of Missouri Food and Agricultural Policy Research Institute (MU FAPRI).
A report released June 29 compares payment cuts to expected expenditures in the 2012 MU FAPRI baseline. The think tank maintains computer models of the farm sector.
“Cutting direct payments would have important effects on federal budgets, farm income and farmland value,” Westhoff added. “Impacts on crop production and prices would be small.”