A bipartisan group of six senators known as the "Gang of Six" released a deficit reduction plan that would reduce the federal debt by $3.7 trillion. The plan closely follows the Bowels-Simpson recommendations of the National Commission on Fiscal Responsibility. Under the plan there would be an immediate deficit savings of $500 billion, including the establishment of discretionary spending caps by 2015, freeze congressional pay, and sell unused federal property. The plan also requires Congress to cut agency spending, overhaul Social Security and Medicare, and rewrite the tax code to generate more than $1 trillion in new revenue. Much of the revenue would come from revising various tax exemptions. The plan would cut agricultural programs, except for food stamps, by $11 billion over 10 years. This is the strongest bipartisan proposal being considered and is gaining support in the Senate. The "Gang of Six" includes Senators Mark Warner (D-VA), Saxby Chambliss (R-GA), Kent Conrad (D-ND), Dick Durbin (D-IL), Mike Crapo (R-ID), and Tom Coburn (R-OK).
Coburn Deficit Plan Provides Major Cuts for Agriculture – Senator Tom Coburn released his "Back in the Black" deficit reduction plan, which would reduce the deficit by $9 trillion over 10 years. Coburn's proposal would cut agriculture by $346.4 billion over 10 years. Much of the savings would be through the elimination of various programs, including: direct payments; counter-cyclical payments; Average Crop Revenue Election (ACRE) program; Marketing Loan Assistance Program; Supplemental Revenue Assistance Payments (SURE); Livestock Forage Disaster Program; Foreign Market Development (FMD) Program; Emerging Markets Program; Technical Assistance for Specialty Crops; and, the Dairy Export Incentive Program. USDA conservation programs would be reduced by 60%, and there would be significant reductions in rural development programs and agricultural research.
Cut, Cap & Balance Passes House – On a near party line vote, the House of Representatives passed the Republican leadership's "Cut, Cap & Balance" deficit reduction plan. The legislation allows a $2.4 trillion increase in the debt ceiling after both chambers have passed a balanced-budget constitutional amendment, caps annual federal spending at 19.9% of U.S. gross domestic product by 2021, and caps discretionary spending for FY '12 at $1.019 trillion. This legislation will now go to the Senate where it will not pass.
Agricultural Groups Weigh-in on Deficit Reduction – Thirty-six agricultural organizations sent a letter to President Obama and congressional leaders saying that agriculture is prepared to take a "proportionate share of budget cuts provided everything is on the table." The organizations reminded the administration and the Congress that agriculture took a $6 billion reduction last year. The groups asked that any decision to reduce agriculture spending include the Senate and House Agriculture Committees' input in making the reductions and to include any changes in the 2012 farm bill in a "manner that does not disrupt long-term commitments reflected in current farm legislation." Those signing the letter included the American Farm Bureau Federation, American Soybean Association, Farm Credit Council, National Association of State Departments of Agriculture, National Association of Wheat Growers, National Corn Growers Association, National Cotton Council, National Council of Farmer Cooperatives, National Farmers Union, National Milk Producers Federation and USA Rice Federation.
Debt Ceiling Deadline Fast Approaching – Everything is on hold as the Congress and the administration continue to grapple with raising the debt ceiling before the Aug. 2 deadline. A number of proposals are on the table, but none have the votes necessary for final passage. To complicate matters for the House Republican leadership, a number of their Republicans colleagues have said they will vote against any plan to raise the debt ceiling. President Barack Obama said he is willing to consider a short-term extension of the debt ceiling if Congress is close to passing a more extensive package.
P. Scott Shearer