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Trump’s budget: What it means for agriculture

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The day is finally here when President Donald Trump’s budget blueprint is set to be delivered to the Hill. Titled “A New Foundation for American Greatness,” and given the subtitle “a Taxpayer First Budget,” the proposal calls for a 3 percent economic growth and for $3.6 trillion in cuts to a wide range of social programs from farm subsidies to federal student aid.

Some of the deepest budget cuts are to agriculture subsidies — squeezing out nearly $50 billion over 10 years. An estimated $193 billion will be cut from food stamps over the next 10 years by cutting back eligibility and imposing additional work requirements. SNAP currently serves about 42 million people.

Here are some of the agriculture budget cut and reduction explanations:

FARM BILL SAVINGS
“The Budget proposes to use means testing to target assistance to those that need it most, and to eliminate programs that have not demonstrated outcomes or are not a Federal responsibility. Specifically, the Budget proposes to: target commodity assistance, crop insurance subsidies, and conservation assistance to producers
that have an Adjusted Gross Income (AGI) of $500,000 or less; limit each farmer or entity to $40,000 in crop insurance premium subsidies; eliminate the ability for producers to purchase subsidized insurance that insures their crops at the higher of the price projected at planting, or that at harvest; eliminate funding for
a number of programs for which there is no Federal purpose; and better target conservation funding to the most sensitive agricultural land.”

MCGOVERN-DOLE INTERNATIONAL FOOD FOR EDUCATION
“The Budget proposes to eliminate the McGovern-Dole International Food for Education program, which is duplicative of U.S. Agency for International Development (USAID) programs, lacks evidence that it is being effectively implemented, and has unaddressed oversight and performance monitoring challenges.”

RURAL BUSINESS AND COOPERATIVE SERVICE
“The Budget proposes to eliminate rural business and cooperative programs given findings that the programs have failed to meet the program goals and are improperly managed.”

RURAL WATER AND WASTE DISPOSAL PROGRAM ACCOUNT
“The Budget proposes to eliminate the Department of Agriculture’s (USDA) funding for water and wastewater treatment facilities because it duplicates the Environmental Protection Agency’s (EPA) State Revolving funds (SRFs). The Administration believes that EPA or private sector sources should fund this activity.”

RURAL DEVELOPMENT SALARIES AND EXPENSES
The Budget reduces funding for salaries and expenses in Rural Development (RD) due to the elimination of funding for the Rural Business Service programs, water and wastewater grants and loans, and single family housing direct loans. These major eliminations will reduce workload for the Rural Development Agencies, so less funding is needed.

SINGLE FAMILY HOUSING DIRECT LOANS
“The Budget proposes to eliminate funding for the Department of Agriculture’s (USDA) rural single family housing direct loan program. Beginning in 2018, USDA will offer home ownership assistance only through its single family housing guaranteed loans. Financial markets have become more efficient, and increased the reach of mortgage credit to lower credit qualities and incomes. Therefore, utilizing the private banking industry to provide this service, with a guarantee from the Federal Government, is a more efficient way to deliver this assistance.”

THE RURAL ECONOMIC DEVELOPMENT PROGRAM
“The Budget proposes to eliminate the interest accrual on future deposits in the Rural Utilities Service borrowers’ cushion of credit accounts, including the interest that is paid to the Rural Economic Development Grant account to pay for rural economic grants and loans. This change is consistent with other Budget proposals that eliminate rural business programs.”

CONSERVATION OPERATIONS
“The Budget proposes to reduce conservation operations by roughly 10 percent in an effort to encourage private sector participation in conservation planning.”

FOREST SERVICE LAND ACQUISITION
“The Budget proposes to reduce Federal land acquisition funding for the Forest Service to focus available funds on the protection and management of existing lands and assets.”

GLOBAL AGRICULTURE AND FOOD SECURITY PROGRAM
“The Global Agriculture and Food Security Program (GAFSP) is a multi-donor trust fund that supports agricultural investment plans of poor countries. The United States has sufficient funding to meet its 2012 pledge to fund GAFSP. No new funding is required in 2018.”

SNAP REFORMS
“The Budget proposes a suite of legislative proposals aimed at targeting Supplemental Nutrition Assistance Program (SNAP) benefits to the neediest households, and encouraging work among able-bodied adults without dependents. The Budget also proposes to re-balance the Federal/State partnership in SNAP benefits
to low-income households by gradually establishing a State match for benefit costs, phasing in from a national average of 10 percent in 2020 to 25 percent, on average by 2023. Combined, these reforms would generate nearly $191 billion in savings over 10 years.”

Office of Management and Budget Director Mick Mulvaney who gave a press briefing Monday, said the proposed budget is “no longer going to measure compassion by the number of programs or the number of people on those programs.  We’re going to measure compassion and success by the number of people we help get off of those programs and get back in charge of their own lives.”

“When I was in South Carolina, we knew where the difficulties were in some of our federal programs, but we didn’t have the flexibility to fix it.  Plus on food stamps, we didn’t have the motivation to fix it.  We didn’t have the incentive to fix it because the Feds were picking up all the whole tab,” Mulvaney said. “So what we do is go to the states and say, look, we want you to have a little bit of skin the game and help us — because you know how to make the programs better — to improve the programs and save money.”

Mulvaney continued saying the administration believes in a social safety net.

“I believe in the social safety net.  I also think that it helps us get to that 3 percent growth because having that social safety net does provide people with the confidence of knowing they can take a gamble and fail, and they won’t be completely wiped out, okay?” Mulvaney said. ” So I believe in the social safety net.  And what we’ve done is not to try and remove the safety net for folks who need it, but to try and figure out if there’s folks who don’t need that need to be back in the workforce.”

House Agriculture Committee Chairman K. Michael Conaway (TX-11) told Fox News: “We think it’s wrongheaded,” about the looming cuts to farm programs. “Production agriculture is in the worst slump since the depression — 50 percent drop in the net income for producers. They need this safety net.”

Following the release of the Trump administration’s FY 2018 budget proposal, Conaway joined Senate Agriculture Committee Chairman Pat Roberts (R-Kan.) in issuing this joint statement:

“We support the Trump administration’s goal of achieving 3 percent economic growth for our nation. USDA’s latest estimates find agriculture, food, and related industries contribute $992 billion to our economy. As we debate the budget and the next Farm Bill, we will fight to ensure farmers have a strong safety net so this key segment of our economy can weather current hard times and continue to provide all Americans with safe, affordable food. Also, as a part of Farm Bill discussions, we need to take a look at our nutrition assistance programs to ensure that they are helping the most vulnerable in our society.”

Agriculture Secretary Sonny Perdue today issued the following statement on the proposed FY 2018 budget:

“President Trump promised he would realign government spending, attempt to eliminate duplication or redundancy, and see that all government agencies are efficiently delivering services to the taxpayers of America.  And that’s exactly what we are going to do at the U.S. Department of Agriculture (USDA).

“Having been the governor of Georgia from 2003 to 2011 – not during the best economic times – we did what it took to get the job done, just like the people involved in every aspect of American agriculture do every single day.  While the President’s budget fully funds nutrition programs, wildland fire suppression and food safety, and includes several new initiatives and increases for Rural Development, whatever form the final budget takes, it is my job as Secretary of Agriculture to manage and implement that plan, while still fulfilling the core mission of USDA,” said Secretary Perdue.

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