NCPA - National Center for Policy Analysis

Agricultural Budget Can Be Cut

May 26, 1999

The $13.945 billion in agriculture program spending recommended by a subcommittee of the House Appropriations Committee is 1.9 percent more than the Fiscal Year (FY) 1999 level but 3.6 percent less than President Clinton's request of $14.475 billion.

Clinton's proposed allocations would shatter budget caps agreed to in the Balanced Budget Act of 1997, warns Budget Policy Analyst Peter Sperry, making Social Security reform and tax cuts much more difficult to achieve. But Congress cannot allocate 100 percent of the off-budget surplus to save Social Security and support military operations in the Balkans without holding the line on domestic discretionary spending.

Sperry says many U.S. Department of Agriculture programs have outlived their usefulness and should be eliminated, consolidated, privatized or devolved to state and local governments.

  • For example, the General Accounting Office recently noted that the USDA Farm Service Agency "maintains a field office structure that dates back to the 1930s when transportation and communication systems limited the geographic boundaries covered by a single field office and there were a greater number of small, widely disbursed, family-owned farms."
  • The Natural Resource Conservation Service, which has been reorganized three times since 1994, claims that it provides technical consulting to 715,000 private, state, and local decision makers; but adding $13 million to its funding, as the subcommittee proposes, would provide only an additional $20 worth of consulting service to each decision maker.
  • The USDA administers over 50 programs to provide housing, utility, and community development services to rural communities that could be devolved to the states using formula grants -- for a saving of $508 million in federal administrative costs, leaving $1.6 billion for grants.

Congress can save $3 billion in agriculture outlays in Fiscal Year 2000 alone by taking these actions.

At the very least, says Sperry, Congress can maintain its commitment to fiscal responsibility and to protecting the surplus for Social Security by freezing agriculture spending at FY 1999 levels.

Source: Peter Sperry, "Crafting a Responsible Budget: The Agriculture Appropriation," Backgrounder No. 1284, May 21, 1999, Heritage Foundation, 214 Massachusetts Avenue, N.E., Washington, D.C. 20002, (202) 546-4400.


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