NCPA - National Center for Policy Analysis

Cuts in U.S. Budget Available

July 12, 2013

On June 13, 2013, the House Appropriations Committee approved its $19.5 billion Agriculture, Rural Development, Food and Drug Administration, and Related Agencies appropriations bill for fiscal year (FY) 2014. The full House is expected to take up the bill soon. With nearly $17 trillion in federal debt and chronic deficits on the budget horizon, the House should pursue spending reductions that keep discretionary spending under the sequestration cap. Rather than rely on indiscriminate across-the-board cuts as in FY 2013, lawmakers should prioritize true federal responsibilities and reduce spending in programs that are duplicative or better left to the private sector or state and local governments, say Daren Bakst and Romina Boccia of the Heritage Foundation.

  • Agriculture-related spending was approximately $139 billion for FY 2013.
  • The $19.5 billion in the House FY 2014 appropriations bill funds discretionary spending, amounting to about 14 percent of all agriculture spending when compared to FY 2013 agriculture-related spending.
  • The remainder of the spending is mandatory spending on programs such as direct payments, crop subsidies and insurance subsidies
  • Even though discretionary spending is not as large as mandatory spending, a total of $3.6 billion in savings can be found.

For example, Foods for Peace Title II grants comprise the largest part of the federal food aid budget. The legal requirements binding the program make it inefficient and unnecessarily costly. Food must be purchased in the United States and then shipped thousands of miles by sea in U.S.-flagged vessels, which adds unnecessary logistical challenges in addition to higher costs. Congress should cut all U.S. Department of Agriculture (USDA) funding for this program and move Food for Peace Title II grants and responsibilities to the U.S. Agency for International Development (USAID). USAID can manage the program with existing development funding, and without the legal requirements that burden the program today. The potential savings from making this shift, as well as cutting all USDA funding for the McGovern-Dole International Food for Education and Child Nutrition Program, results in nearly $2 billion in savings.

Other USDA areas that can be cut:

  • Conservation technical assistance. Potential savings $714 million.
  • Agricultural research. Potential savings $615 million.
  • Rural business cooperative service. Potential savings $92 million.
  • Distance learning, telemedicine and broadband program. Potential savings $40 million.

Source: Daren Bakst and Romina Boccia, "Congress Could Cut Five USDA Programs and Save $2.8 Billion a Year," Heritage Foundation, July 2, 2013.


Browse more articles on Tax and Spending Issues