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Vilsack Up to Challenge of Obama's 2014 Budget

posted on April 16, 2013

 Concerns that “the sequester” and new taxes enacted at the beginning of the   year might have a negative effect on the economy appear to have been realized.

According to the Commerce Department, retail sales fell .4 percent last month as consumers kept their wallets in their pockets.  When the volatile categories of autos, gas and building materials are pulled out of the equation, core sales only fell .2 percent.

As consumers seemed reticent to open their pocketbooks, producers cut back on their orders of wholesale goods as the Producer Price Index fell .6 percent last month. Core inflation, which excludes volatile food and energy prices, actually rose 0.2 percent in March.

The stock market has experienced several records sessions over the past few weeks.  The Dow Jones Industrial average and the S&P 500 spent most of the week in record territory only to fall back slightly at week’s end.

At the point when Wall Street was riding high earlier in the week, the Obama Administration released its version of the 2014 federal budget. No department escaped the fiscal axe including the agency tasked with controlling benefits for farm country

Vilsack Up to Challenge of Obama's 2014 Budget

The ongoing budget battle in Washington ramped up this week as President Obama sent Congress his $3.8 trillion spending request for fiscal year 2014.  Seeking common ground with Republicans, the president’s plan aims to reduce the federal debt by $600 billion over the next decade.

 Initiatives include rebuilding America’s infrastructure, overhauling education, and raising the minimum wage, among others.  Some suggest the White House recommendation may represent the nation’s best hope to replace sequestration with bipartisan deficit-reduction before another potential debt ceiling fight this summer.

President Barack Obama: “If we want to keep rebuilding our economy on a stronger, more stable foundation, then we’ve got to get smarter about our priorities as a nation.  And that’s what the budget I’m sending to Congress today represents – a fiscally responsible blueprint for middle-class jobs and growth.”

 According to the Office of Management and Budget, the anticipated cuts to 215 programs are projected to save over $25 billion next year.

Under the plan, USDA would see a 5.9 percent decrease from its 2013 appropriation, taking a bite out of direct payments to farmers and government assistance for crop insurance.  The proposed budget also would streamline international food aid.

President Barack Obama: “Good morning everybody.”

 The Obama administration claims many farm subsidies simply are not justified as record farm      incomes are forecast to continue.  The Agriculture Department predicts net farm income will increase this year by 14 percent to $128.2 billion, giving farmers their highest income – when adjusted for inflation - since the 1970s.

Secretary of Agriculture Tom Vilsack claims USDA is committed to what he calls the Farm, Food and Jobs Safety Net for agricultural producers, but he views the president’s proposal as an opportunity to negotiate a better deal for taxpayers.

Sec. Tom Vilsack, USDA: “This is a challenging budget, and it requires us to think anew, and think differently about ways in which we can provide the same level of assistance or help or in some cases more assistance and help with less money.”

 USDA initiatives like the Supplemental Nutrition Assistance Program, or SNAP, and other social programs, account for the vast majority of the total Agriculture Department budget. Farm and commodity    programs make up less than 20 percent of USDA expenditures.

The budget for SNAP -- -- formerly known as Food Stamps -- -- has more than doubled since president Obama first took office, due largely to the recession. The expenditure which provides food assistance is expected to cost more than $80 billion in 2014.   

Rep. John Boehner, R – Ohio:  “It’s time to focus on the real problem here in Washington.”

Continued calls from conservatives to overhaul SNAP have largely fallen on deaf ears, but the administration is throwing strong support behind the program in what it calls a “time of continued need.”

The president’s proposed budget would cut spending on government benefit programs like Medicare and Social Security by $130 billion over ten years. Those concessions, while loathed by some Democrats, are viewed as an olive branch by Republicans.  Skepticism of a grand bargain remains, however, as the right adamantly rejects the president’s insistence on tax hikes for the wealthy and some businesses.

But the struggle is not over in Congress. While lawmakers work on reining in spending, rural America waits for both parties to find a solution to the elusive five-year Farm Bill.

Tags: budget Congress Farm Bill Fiscal 2014 food stamps Medicare Obama SNAP Social Security Tom Vilsack USDA