If the White House’s proposed fiscal year 2013 budget is enacted, the USDA would face a 3 percent spending cut. The election-year proposal comes as 2011 farm incomes are projected at a near-record $22 billion.

Aiming to carve a chunk out of the federal deficit as the next farm bill is written, the White House would slash agriculture spending $32 billion over 10 years – including the elimination of direct payments, which cost nearly $5 billion annually. In recent months, Congress proposed whittling the USDA budget around $23 billion.

The suggested funding cuts are unlikely to shock farmer advocacy and commodity groups as they are similar to previous Obama administration budget proposals. Those cuts include:

  • Crop insurance subsidies cut over $7.5 billion over the next 10 years.
  • Two million acres removed from the Conservation Reserve Program.  
  • A slight drop – 0.6 percent – that would bring the cost of food stamps to $70 billion.

“The budget we’re proposing will give us the ability to utilize time to manage the cuts that have already been ordered over the course of the last couple of years,” said Agriculture Secretary Tom Vilsack during a Monday afternoon press conference. It will “give us additional time to properly implement additional changes that will be forthcoming as a result of our ‘administrative services project.’ And it will enable us to continue to provide the help that has led to record income levels for producers and lower unemployment in rural America.

“It is important when looking at this budget that you put it into context of what’s taken place over the course of the last couple of years. We’ve seen reductions in our discretionary budget and the operations budget for USDA. That, together with inflation, has required steps (that include) reducing costs for travel, supplies, and conferences. It has led to us reducing our workforce of experienced workers by over 7,000 over the last 15 months through normal attrition and through early retirement and early separation programs. It has also resulted in the implementation of the first 27 of 379 recommendations for changes in internal operations of USDA under the administrative services projects as well as the office and lab closings announced earlier this year.”

For more on USDA office closings, see here, here and here.

Vilsack said there have also been funding reductions of mandatory programs including “reduced growth rate in conservation programs combined with crop insurance savings. … We anticipate there will be additional savings as Congress debates, and ultimately passes, the (next) farm bill. We see 2012 and 2013 as years when we can implement changes in a thoughtful way.”