Final Budget Has $7 Billion for Farmers

April 14, 2000

That $1.83 trillion budget for fiscal 2001, approved by the House with Senate approval expected shortly, includes $5.5 billion in assistance for farmers yet this fiscal year with another $1.64 billion provided in fiscal 2001 for major crop producers and producers of specialty crops.

The $5.5 billion still must be authorized by the agriculture committees. The conference-approved bill specifies that the $5.5 billion not be part of the appropriations process but instead be a free-standing bill. Nothing in the budget resolution specifies that the money be used to supplement 1996 farm law transition payments.

Although there are indications from congressional leaders that the money should be used to supplement farmers’ annual freedom to farm payments, Democrats can be expected to offer alternatives when the provision is considered in committee.

The budget also includes $8.2 billion for crop insurance and risk management for fiscal 2001-2005. For fiscal 2001, $1.42 billion is authorized. Crop insurance reform legislation was passed both by the House and Senate and now is in a conference committee for final consideration.

Total agricultural spending under the resolution is $35.3 billion in budget authority and $33.9 billion in outlays for fiscal 2000. Budget authority then declines to $20.8 billion and less in 2001-05.

House Budget Committee Chairman John Kasich (R-OH) said the budget resolution "takes a big step in promoting tax fairness. In all, we’ll have at least $150 billion in tax cuts. I hope we can do more."

But in a White House statement, President Clinton said the Republicans are hiding the cost of tax cuts. "By using five year numbers," Clinton said, "the congressional budget resolution hides the true cost of the Republican tax cuts, doing nothing to constrain their growth after 2005."

He said the Republicans are using "unrealistic spending cuts" that, if they don’t materialize, the budget would spend $67 billion of the Social Security surplus in the first five years. With interest, the cost of tax reductions would be $194 billion, said Clinton.

Clinton last year vetoed a tax reduction package he said would have cost $156 billion over five years and "exploded" to $792 billion over 10 years.

Kasich said the budget is designed to pay down the public debt by $1 trillion over five years, "putting us on a path to eliminate the entire public debt by 2013."