In the early days of USDA, half of the department’s budget was directed to agricultural research and development. Nowadays, its share is 1.8 percent and the nation trails competitors that include China, said economist Philip Pardey of the University of Minnesota in calling for a hefty increase in funding.
A doubling of the USDA research budget, now around $3.9 billion a year, would be justified based on dozens of studies. They show a median of $7.51 in benefits — such as increased agricultural productivity, lower farm expenses and lower consumer food prices — for each $1 invested, wrote Pardey for an American Enterprise Institute publication. A funding increase of 2.08 percent a year, rising to $5.9 billion in 2050, would be needed just to stay current in “stocks of agri-food knowledge,” he said.
“Failing to refurbish the stock of U.S. agricultural knowledge capital is already having real-world consequences in terms of declining rates of agricultural productivity growth and increasing pest and environmental risks — risks that will only magnify in the decades ahead absent the research-driven discoveries required to successfully tackle these pressing real-world problems,” said Pardey.
To pay for an expanded ag research budget, Pardey said Congress should cut the “politically popular price support programs.” Part of the savings could be directed into agricultural research and development and the rest could go toward deficit reduction. “Done right, federal agri-food R&D could be distributed to states in ways that also revitalize” state research agencies, he said. “That would be an economically efficient approach to slicing up the farm bill pie.”
Federal and state spending on agri-food research and development has fallen over the past two decades, said Pardey, who described research as “slow magic” that requires years of work to produce results; it can take seven to 15 years to develop a new crop variety. “Thus, there is real urgency to redress the large funding shortfall that has accumulated over the past decades and do so in ways that sustain the commitments to higher levels of funding.”
China and the European Union devote far more in public funds to agricultural research and development than does the United States. China passed the United States around 2008 and then the EU in 2011, according to USDA economists. They estimated the Chinese government spent more than $10 billion on ag R&D in 2015.
In early March, the White House proposed a $299 million increase for ag research, education and outreach activities at USDA as part of the proposed fiscal 2024 budget. The administration said the increase “restores American leadership in agricultural innovation and research.”