Trump budget seeks to cut farm subsidies

President Donald Trump's proposed 2021 fiscal year budget would slash trade aid payments to farmers while simultaneously trimming funding to certain farm subsidies.

The White House proposes cutting nearly $9.9bn, or 53pc, to various market subsidy programs from its 2020 estimates, including the US Department of Agriculture's (USDA) Market Facilitation Program (MFP).

The cuts, if implemented, are expected to save more than $33bn during the next 10 years, the White House said.

The USDA in 2018 launched MFP as a part of a larger trade aid package targeting farmers impacted by the now de-escalating trade war between the US and China. The USDA distributed nearly $19.44bn of cash payments to farmers between 2018-19 and is expected to funnel an estimated $3.7bn more to farmers in 2020 — nearly one-quarter less than what was distributed last year, according to USDA estimates.

The White House, though, aims to redistribute some of the monies previously earmarked for trade aid to widely used crop insurance programs. The USDA's Agricultural Risk Coverage (ARC) and Price Loss Coverage (PLC) programs — which are designed to shield farmers from market volatility — would benefit from a 32pc increase in funding to under $3.43bn Trump's budget proposal.

The proposed budget, which would fund the government in the fiscal year ending on 30 September 2021, has little chance of being adopted in its current form. The deep cuts in spending stand in contrast to the 4pc bump in non-defense funding the US Congress approved last summer through a two-year bipartisan budget deal. Democratic critics say the proposed budget would mean draconian cutbacks to government services. Even Republican lawmakers have balked at past budget cuts they say would hit their constituents.

By Connor Hyde