U.S. Budget Cutters Eyeing Farm Aid

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ATexas Democrat who used to be a leader of fiscal conservatives in the U.S. House of Representatives told a big farm group on Jan. 11 that Congress members keen to cut federal spending will look at U.S. farm supports.

“All of us in agriculture recognize the fiscal challenge to come,” said Charles Stenholm, a senior advisor at a Washington consulting firm who represented a west Texas district for 26 years. He spoke at a “break-out” session at the American Farm Bureau Federation meeting.

Stenholm, who is active in balanced-budget groups, declined to suggest specific areas to be targeted but said it could be hard to defend biofuel supports and grain subsidies. He said farm supports and crop insurance may need revisions to stretch funding.

Stenholm said economic recovery “is one thing that will save Democrats” from stinging losses in the midterm elections this fall.

The Obama administration was expected to release its proposals for the fiscal 2011 budget in coming weeks. There were reports a spending freeze or cuts might be asked many agencies to constrain the federal deficit.

A year ago, Obama unsuccessfully proposed a $250,000-a-year limit on farm subsidies and a phaseout of the “direct payment” subsidy to farmers with more than $500,000 a year in sales, together saving $1 billion a year. The White House also wanted to reduce crop insurance subsidies by $500 million a year.

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