President Bush kept his vow to provide $73.5 billion in new agricultural spending through 2011, but his budget proposal Monday didn’t provide any hints about increased farm subsidies. The proposed USDA budget shows new money for farm bill legislation with no breakdown of spending. It listed $4.2 billion this year and $7.27 billion next year. Administration officials were working behind the scenes to influence an overhaul of U.S. farm policy, now in its final stages in Congress, the point where the president traditionally has the greatest leverage.
Both chambers of Congress want to add $5 billion a year to grain, cotton and soybean subsidies as well as release additional billions of dollars whenever returns to producers from sales and subsidies were below targets set by law.
So far, the White House has had little luck with its warnings against over-dependence on subsidies and concern the farm bill would violate world trade pacts. It also wants financial rewards for stewardship of working farm and ranch land.
Farm groups want the new farm law to apply to this year's crops. The spring planting season is only weeks away in the South.
The new farm bill, which maps policy for U.S. farm exports, subsidies, conservation spending, food stamps and agricultural research, will replace a five-year farm bill which expires in 2002.
Agriculture Department officials at the highest levels argued for listing $7.3 billion in farm bill outlays this year but the administration decided $4.2 billion was more realistic. In the end, the figure may be irrelevant – the budget will be adjusted to reflect the terms of the yet-unwritten bill.
The White House says it will support a generous farm bill which is based on sound policy. Its harshest criticism has gone to the bill pending in the Democratic-led Senate for raising crop supports.
In late December, the administration said it would stand by $73.5 billion in new agricultural funding, a 78 percent increase, to quell fears Congress would renege on the funding in the face of federal deficits. Lawmakers, however, set spending limits and can rewrite the president's budget.
The Senate is expected to resume debate on a farm bill in the next week or two. The Republican-led House already approved its version of the bill.
While the Bush budget proposal included more money for farm subsidies, the overall budget for the USDA would drop in fiscal 2003 under the president's plan.
The White House proposed total spending of $74.4 billion for fiscal 2003, down from $76.6 billion in the previous year. Fiscal 2003 begins on Oct. 1.
The budget decline will largely occur because the administration anticipates grain prices will modestly improve, reducing outlays for marketing loans used when prices fall below a federally set threshold.