Farm Groups React to Obama Budget Plan

Farm groups spent Tuesday looking over the President’s proposed federal budget and, for the most part, they do not like what they see. The $700 million dollar cut in the USDA budget is not the issue; it is the priorities within the department that worry farm groups. Food and nutrition programs which make up over 70% of the USDA budget were virtually untouched, while farm programs saw some serious cuts. One area that has raised some red flags is a reduction in crop insurance funding. The American Farm Bureau Federation’s Dale Moore says, with the elimination of direct payments, crop insurance becomes the primary safety net for growers, “We want to make sure that whatever crop insurance plan there is down at USDA for funding the crop insurance is robust and keeps focused on those risk management tools as a critical part of farmers’ risk management safety net.” The NCBA blasted the President’s proposal to lower the estate tax exemption and raise the estate tax rate. NCBA President J.D. Alexander said the President’s take on the estate tax threatens job creation and punishes the producers of food and fiber. “President Obama has much to learn about the realities of small businesses and production agriculture. Most of these farm and ranch families are not wealthy. Instead, their value is tied up in the land they work and the equipment they use to provide a safe and affordable food supply for a growing population,” said Alexander. “The President’s war against the rich will negatively impact farmers and ranchers who are simply trying to feed their neighbors. Increasing land values and the rising costs of equipment drive up the value of farm and ranch estates. If allowed to continue, the estate tax will continue to break up farms and ranches across America and will make it much more difficult to meet the increasing demand for food around the world.” The President’s budget proposes an estate tax at a $3.5 million exemption level with a maximum tax rate of 45 percent. As a result of a last-minute fix passed through Congress in December 2010, the current estate tax exemption level is $5 million per individual and $10 million per couple with a maximum tax rate of 35 percent...more