Senator opposes subsidy cuts

Mar 27, 2009
by WLJ
Senator opposes subsidy cuts

The Senate Budget Committee chairman said last Tuesday he will not propose cuts in U.S. crop subsidies for fiscal 2010 despite White House proposals to pare down payments to big farmers.

Members of the Senate and House Budget committees were scheduled to begin work last Wednesday on a spending outline for the government for the fiscal year beginning Oct. 1. Budget chairman Kent Conrad, D-ND, told reporters that he would save $2.5 billion through cuts in two land stewardship programs, crop insurance subsidies, and the Market Access Program (MAP), which shares the cost of building foreign demand for high-value U.S. farm exports.

But Conrad said the crop subsidy cuts proposed by President Barack Obama would not be part of his budget package. The North Dakota Democrat has said it would be a mistake to cut farm supports during a recession.

Nor was the House Budget Committee expected to include the cuts in its pack age, said a staff worker who spoke on condition of anonymity.

Instead, Conrad said he would propose cuts in the Environmental Quality Incentives Program, which shares the cost of controlling runoff from fields and feedlots; the Conservation Reserve, which pays owners to idle fragile land; in the federally subsidized crop insurance program, and in MAP, authorized at $200 million a year. Like Obama, Conrad would pare MAP by $40 million a year. The White House says nearly $10 billion could be saved over 10 years by putting a $250,000 a year cap on farm payments and phasing out the direct-payment subsidy to farms with more than $500,000 a year in sales. There are roughly 126,000 farms in that category.

Besides its proposals on direct payments and a payment cap, the White House suggested $5.2 billion in cuts over 10 years in crop insurance subsidies, the 20 percent cut in MAP, and ending cotton storage payments. — DTN