President's Proposal Slashes Direct Payments, Ups Estate Tax
Thursday, September 22nd, 2011
On Monday, President Barack Obama released his plan to reduce the deficit by $4.4 trillion over 10 years. Included in that figure is $1.2 trillion in discretionary spending cuts already enacted by the Budget Control Act, making for a net savings of more than $3 trillion over the next decade.
The plan, "Living Within Our Means and Investing in the Future," proposes $257 billion in cuts from mandatory programs outside of health care. For agriculture, the president's proposal would eliminate direct payments for a savings of $3 billion per year and reduces subsidies for crop insurance companies and changes subsidies for producers for a savings of $8.3 billion over ten years. The proposal would also reduce conservation funding by $2 billion over 10 years and extends mandatory disaster assistance.
President Obama's plan calls for increasing the capital gains tax rate for individuals making more than $200,000 per year and for couples making more than $250,000. The president's proposal returns the estate tax exemption to $3.5 million per person with a top rate of 45 percent.
In a joint statement, Frank Lucas (R-Okla.), House Agriculture Committee Chairman, and Pat Roberts (R-Kan.), Senate Agriculture Committee ranking member, said President Obama's proposal shows a lack of knowledge of production agriculture and how the changes would impact farmers.
"For example, cutting $8 billion from the crop insurance program puts the entire program at risk," Lucas and Roberts wrote. "We have heard again and again from producers that crop insurance is the best risk-management tool available. In jeopardizing this program, the president turns a deaf ear to America's farmers."
American Farm Bureau