House Ag Members United Against Budget Cuts

On the Senate side, Sen. Harkin outlines major cuts beyond highly-publicized payment limits. Compiled by staff

Published on: Feb 10, 2005

"If Republican leaders move ahead with the Bush budget it will start a process equivalent to writing a new farm bill," Congress Daily reports House Agriculture Committee ranking member Collin Peterson of Minnesota saying.

Peterson has united his fellow 21 Democrats on the committee to sign a petition, stating the entire group opposes Bush's proposed agriculture cuts. Peterson says he also plans to seek a resolution of opposition from the House Democratic Caucus at its next meeting.

Senate leaders are also voicing concerns with the budget. Current Senate Agriculture Committee Chairman Sen. Saxby Chambliss, R-Ga., and former Chairman Sen. Thad Cochran, R-Miss., have voiced concerns about the payment limits but haven't totally written-off the possibility of cuts. Both have said the budget targets certain regions (particularly the south) more than other regions.

Sen. Tom Harkin, Senate ag committee ranking member, says payment limit coverage is overshadowing the $1 billion in cuts for other farmers. Specifically, Harkin highlighted the 5% across-the-board cut to commodity loan programs and direct and counter-cyclical payments. The president’s budget would also limit the percentage of a farmer’s crop that would be eligible for marketing loans or loan deficiency payments (LDPs).

The 5% cuts limit eligibility for marketing loan benefits and reduce farmers’ support over all, especially when commodity prices fall below reasonable levels. The income protection is in the form of direct and counter-cyclical payments as well as marketing loan benefits. Consider this:

Assume a farmer has 250 acres of corn and 150 acres of soybeans on base acres in 2004. Also assume this farmer had average payment yields and average actual yields last year. If President Bush’s proposal had been in place for the 2004 crop year, this farmer would have lost $7,700 in farm income in one year alone. This may not seem like a lot, but to a farmer earning $40,000 annually, it represents a nearly 20% drop in income.

Below are cuts proposed to farm income safety net programs for 2006 alone:

  • $383 million cut from direct and countercyclical payments, marketing loan benefits and dairy programs.
  • $432 million cut in loan benefits. This cut would severely limit the amount of a farmer’s crop eligible for marketing loans.
  • $200 million cut in program benefits from tightening payment limitations.
  • $130 million cut in dairy price support.

Conservation also took a hit with the new budget. Those conservation initiatives on the cutting block include:

  • A 40% ($182 million) cut in the Conservation Security Program.
  • Slashing 1/6 of funding available for the Environmental Quality Incentives Program (EQIP).
  • $210 million cut in Watershed Rehabilitation.
  • $25.6 million cut in Resource Conservation and Development (RC&D). This program assists State and local governments and local nonprofit organizations in rural areas with planning and development. The president’s budget proposes to eliminate funding for 189 of 375 current projects
  • A 30% ($25 million) cut in the Wildlife Habitat Incentives Program (WHIP).
  • A 16%, ($16 million) cut in the Farm and Ranch Lands Protection Program (FRPP). This program helps local governments and nonprofit organizations obtain conservation easements to protect agricultural lands and keep them in agriculture.