President Obama unveiled his fiscal 2012 budget Monday, a $3.73 trillion spending package which would reduce the federal deficit by $1 trillion over a ten-year period. The Obama plan would reduce or eliminate over 200 federal programs including a $3.2 billion reduction in discretionary spending at USDA. Ag Secretary Tom Vilsack says the budget reflects the fact overall agriculture is enjoying economic strength although there are some exceptions “And so it’s necessary for us to have a strong safety net in place to make sure that we can deal with any contingencies that may arise as a result of weather or poor prices.”
The Secretary says there is also a continuing need for food assistance. “The budget reflects the reality of the fact that there are still people struggling in this economy so we continue to provide food assistance as well as adequately funding the school lunch and school breakfast program. And continuing a strong, but somewhat focused commitment on rural housing,” he adds there is also a continuing need for safe food.
So how big of a cut in the ag budget are we talking here? “Discretionary spending is four billion dollars less proposed in 2012 than 2011. Total outlays are seven billion dollars less.” Vilsack says some of the cuts are the savings in crop insurance which were initiated this year and carry over into next year; it eliminates the guaranteed operating loan with interest assistance program and would reduce adjusted gross income eligibility and cap individual direct payments. “We anticipate because of the strong agricultural economy that there will be very little need for long deficiency programs. We are proposing an elimination of congressional earmarks persistent and consistent with the president’s direction both on the research side and on the conservation earmarks side.”
There would be some changes to environmental programs. Vilsack says there will be,“Reductions in the Wildlife Habitat Incentive program and the Grassland Reserve program will be offset by continued increases in EQIP and adequately funding the CSP program.”
The plan continues to fund export expansion efforts, “This budget actually proposes an increase in export assistance. For every dollar that we invest in export assistance we see a return of 35 dollars of economic activity,” says Vilsack. “That’s something that will, obviously, create jobs and create additional opportunities for our producers.”
The spending plan does maintain a strong safety net for farmers, “By the use of our guaranteed and direct loan programs for ownership and operating loans, expanded crop insurance program as well as adequately funding our disaster programs under the 2008 Farm Bill.”
The plan would also maintain the Forest Service budget.