February 16, 2011 11:21AM # Republicans Punt on Farm Subsidies. Again. By [Sallie James](https://www.cato.org/people/sallie-james) --- SHARE While I fully agree with my [colleagues](https://www.cato.org/deconstructing-the-spending-side-of-obamas-proposed-fy2012-budget/) that President Obama “[chickened out](http://www.nationalreview.com/corner/259718/president-chickens-out-spending-cuts-chris-edwards)” in general in his FY2012 budget proposal, in one area he had the courage to propose some cuts that have proven controversial for ages: farm subsidies. His plan would lower the income eligibility limits for subsidies (from $500,000 to $250,000 for off-farm AGI per farmer, and an on-farm AGI limit of $500,000, down from $750,000.) It would also lower the cap on annual direct payments that individuals can receive — from a maximum of $40,000 to $30,000. The [administration’s proposal](http://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/agriculture.pdf) would affect only about 2 percent of the total recipients of direct payments — subsidies that flow every year regardless of prices or farm output to owners of land that may or may not still be used for farming — and it *does not by any means go far enough*. But at least it is a start. On the other side of the aisle, the Republicans followed their [Republican Study Committee colleagues](https://www.cato.org/rsc-silent-on-farm-subsidies/) in failing to propose any cuts to “farm subsidies” as we typically understand them in their FY2011 budget proposal. To be sure, 22 percent of the $60 billion in cuts they propose would come from the “agriculture function,” and they indeed get rid of entire programs, but they are mainly to the nutrition and conservation areas of the USDA’s responsibilities. Nothing, so far as I can tell, from the commodity programs. I’m under no illusions that cutting farm subsidies are the key to our ever-growing fiscal mess. But it is telling that the Republicans can find *not one dime* in our [bloated, distorting, regressive, corrupt farm programs ](https://www.cato.org/pub_display.php?pub_id=5999)to cut, even as farmers’ [incomes](http://www.ers.usda.gov/Briefing/FarmIncome/nationalestimates.htm) and [wealth](http://www.kansascityfed.org/publicat/research/indicatorsdata/agcredit/AGCR4Q10.pdf) soar. On the upside, [a group of legislators is proposing amendments ](http://blumenauer.house.gov/index.php?option=com_content&task=view&id=1797&Itemid=67)to limit direct payments and put an end to the [disgraceful deal on cotton subsidies cooked up by the administration last year](https://www.cato.org/deal-or-no-deal-2/). So maybe some reform can come from there. (This hardly needs to be said, but the farmers’ groups are, of course, [maintaining their position ](http://nfu.org/news/2011/02/14/nfu-obama%e2%80%99s-budget-proposal-shortchanges-agriculture-rural-development.html)that farm programs should be subject to cuts no greater than the cuts to other areas of federal spending.) ##### Related Tags [Tax and Budget Policy](https://www.cato.org/tax-budget-policy), [Trade Policy](https://www.cato.org/trade-policy), [Herbert A. Stiefel Center for Trade Policy Studies](https://www.cato.org/herbert-stiefel-center-trade-policy-studies) [![Creative Commons License](/build/cato_2020/images/creative-commons.svg)](http://creativecommons.org/licenses/by-nc-sa/4.0/) This work is licensed under a [Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License](https://creativecommons.org/licenses/by-nc-sa/4.0/).