Tightening USDA's Budget

OMAHA (DTN) -- The U.S. Department of Agriculture would take a $4.7 billion cut in discretionary programs next year under President Donald Trump's proposed budget, or about a 21% cut from 2017 spending levels.

The budget blueprint released Thursday by the White House proposes a $17.9 billion discretionary budget at USDA, down from $22.6 billion for the current budget year.

The budget does not call for cutting direct farm programs, which are considered mandatory spending programs. USDA's mandatory budget, dominated by domestic food programs, is about $130 billion annually.

Regarding the discretionary cuts, the White House stated USDA's budget proposal protects the department's core function while "streamlining, reducing or eliminating duplicative, redundant or lower priority programs where the Federal role competes with the private sector or other levels of government."

The proposed cuts to USDA come as the department is without an Agriculture secretary or other political leadership to advocate for the department's broad array of programs. Sonny Perdue, the president's nominee for Agriculture secretary, has yet to have a confirmation hearing. That hearing could potentially happen before the end of the month.

In a proposal that could affect services for farmers, the budget proposal calls for cuts to USDA county offices, an effort that has been attempted by both of the past two presidents but has been frequently blocked by Congress. The 2014 farm bill actually requires USDA to specifically detail to Congress any proposed cuts to Farm Service Agency offices.

Unlike the Obama administration, the budget proposed by the Trump administration does not call on any changes to crop insurance. That was a frequent proposal by the Obama administration that was largely rejected by Congress.

The proposal released Thursday would gouge deep into areas such as Rural Development, eliminating several loan and grant programs including water and wastewater loans and grants to communities, a $498 million program. Another proposed elimination is the Rural Business-Cooperative Service, a $95 million program offering grants and loans for small rural start-up businesses and communities.

The White House called some of the USDA Rural Development programs "duplicative" with those in other departments.

The proposed USDA cuts come after the House Agriculture Committee wrote a letter to colleagues in the Budget Committee earlier this month asking to leave the Ag department harmless due to cuts in the 2014 farm bill, a decline in spending for food aid and struggles in the farm economy. Twelve farm and commodity groups on Wednesday also wrote the House and Senate appropriation committees calling on them to boost spending for farm programs because of the poor farm economy.

Roger Johnson, president of the National Farmers Union, said the budget proposal shuns rural America. "The last thing our members need right now is more cuts to agencies and programs that provide incredibly important work, especially in the midst of the current farm crisis," Johnson said. "These cuts and the message they send to rural America are deeply disappointing."

The Theodore Roosevelt Conservation Partnership, leading a coalition calling itself "America's Voice for Conservation, Recreation and Preservation," also criticized the budget proposal for overall cuts in conservation lands across departments. "Ignoring the real benefits of investing in conservation will erode the foundation of hunting and fishing -- public access and quality places to pursue our traditions."

Countering such criticism was the conservative group Heritage Action with its CEO, Michael Needham, saying "there is a lot for conservatives to like in President Trump's budget request."

Needham added the budget details a smaller, more efficient government. "Unfortunately, key Republican lawmakers preemptively dismissed the president's budget request last month. President Trump must not allow parochial concerns and Washington norms to stymie his effort to drain the swamp and put America first and make America great again," Needham said.

Without major details, the White House notes it proposes $350 million for competitive agricultural research grants. Still, the budget implies cuts to research grants by noting the budget "focuses in-house research funding" at the Agricultural Research Service to specific program areas.

White House budget director Mike Mulvaney on Wednesday called the budget an "America first" budget. He said White House staff combed through Trump's campaign statements and policies and turned those positions into numbers.

"If he said it on the campaign, it is in the budget," Mulvaney told reporters in a briefing.

The budget proposes a $54 billion increase for Defense spending, as well as more for national security and law enforcement. In return, Mulvaney said there would be cuts to foreign aid, regulatory agencies and elsewhere. Regarding cuts to foreign aid and boosts in Defense, Mulvaney said the spending sends a signal to both allies and enemies that this is "a hard power budget, not a soft power budget."

Mulvaney said the president's budget proposal does not add to the $488 billion deficit already forecast by the Congressional Budget Office. Instead, it makes those significant cuts to several departments to offset the president's proposals to increase Defense spending and elsewhere.

"We have simply not added to the deficit to accomplish those policies," Mulvaney said.

While focusing on the cuts to the State Department and Environmental Protection Agency on Wednesday, Mulvaney did not mention the Department of Agriculture in his briefing about the proposed budget.

Unlike budget proposals by the Obama administration, the proposal released Thursday is not a line-item, detailed budget proposal for each department and agency. Instead, the proposal is more of a blueprint of which departments would see cuts and which departments would see increases.

The White House notes it fully funds wildfire suppression at the U.S. Forest Service in USDA at $2.4 billion. However, former Agriculture Secretary Tom Vilsack frequently called for more funding for wildfire suppression because USDA often assigned as much as $864 million more to deal with additional costs from more expensive wildfire battles. The White House also proposes reducing spending in other areas of the forest system, including land acquisition.

In another area, the White House also proposes cutting funding for USDA's statistical capabilities at the National Agricultural Statistics Service, "while maintaining funding to complete the Census of Agriculture."

Among cuts at USDA are foreign food aid programs that are actually reflected in the Department of State and U.S. Agency for International Development budgets. The White House proposes eliminating multiple foreign-aid programs, including the Food for Peace program, which is operated partly by USDA and the U.S. Agency for International Development. USDA spent $1.7 billion for the program in 2016, and the department requested $1.35 billion for the program this year.

Also in foreign aid, the Trump administration proposes eliminating the McGovern-Dole International Food for Education program, which was created to help educate children in poor countries by paying for food at those schools. The program spends between $180 million to $200 million a year.

Domestically, the White House proposes $6.2 billion for the Women and Infant Children's program, which appears to be about a $150 million cut from the prior two budget years.

Among major departments, USDA's proposed $4.7 billion cut is less than other departments. The White House proposal includes:

-- A $10.9 billion cut to the State Department, which includes those major foreign-aid programs, a 28.7% cut in the discretionary budget.

-- A $9.2 billion cut to the Department of Education, a 13.5% cut.

-- A $12.6 billion cut to the Department of Health and Human Services.

-- A $2.6 billion cut to the Environmental Protection Agency.

-- A $1.5 billion cut to the Department of Interior.

-- A $4.4 billion increase to the Department of Veteran Affairs.

Details on the White House budget blueprint can be found at https://www.whitehouse.gov/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

(AG)

Copyright 2017 DTN/The Progressive Farmer. All rights reserved.