Cost savings under the 2014 farm law will be more than twice as large as originally forecast, around $36 billion over 10 years, thanks to markedly lower projected outlays on food stamps and crop insurance, says the House Agriculture Committee. The rosier outlook will not stop an ongoing review of food stamps, the largest U.S. anti-hunger program, committee leaders said in a letter that asked the Budget Committee to look elsewhere for spending cuts.
The “budget views” letter, a preliminary step in the assembly of a congressional spending plan for the coming fiscal year, included an appeal for the administration to create a subsidy program for cottonseed. “U.S. cotton farmers are in serious jeopardy,” said the letter. “It is equally important for the administration to use all of the tools at its disposal to help farmers mitigate the tremendous risks they face.”
Compared to estimates that the 2014 farm law would cost $96 billion a year, “We estimate that anticipated savings have increased,” said the budget letter, which says the Agriculture Committee “has done its duty for now with respect to deficit reduction and that areas constituting the other 98 percent of the federal budget ought to be looked to first for any additional savings being sought this Congress.”
When it was passed, the farm law was projected to save $16 billion over 10 years beginning in fiscal 2014. Now, “you get about $36.1 bill in savings when comparing to the 2014-23 period,” said a committee spokeswoman. “Lower SNAP [food stamps] spending is certainly a factor,” and “crop insurance has come in considerably below estimates.”
Crop insurance would cost $7 billion less than originally estimated, based on current conditions, said the spokeswoman.
Food stamp spending could be $17 billion less than forecast when Congress enacted the farm law, based on a review of CBO data, due to lower jobless rates and fewer people enrolled in the program. The committee did not provide an estimate of food stamp savings.
When the farm law was passed, the $16 billion in estimated savings was split fairly evenly between food stamps and farm supports, with an expansion of the federally subsidized crop insurance program offsetting crop subsidies.
Farm subsidy costs are higher than forecast, due to a slump in commodity prices, which partially offsets the savings in other parts of the farm law.
Food stamps account for three-fourths of USDA spending. Conservative Republicans unsuccessfully proposed $39 billion in cuts in the program, by tightening eligibility rules, during debate on the 2014 law.