Iowa Ag Review Winter 2005 , Vol . 11 No . 1

Republicans control both houses of Congress as well as the presidency. Control means accountability, and large federal budget deficits do not harmonize with the Republican self-image of fiscal prudence. Thus, one of the top agenda items this spring and summer will be how to reduce the federal budget deficit. President Bush and congressional leaders have ruled out tax increases. This leaves only two ways of reducing the deficit: either spending will have to be reduced or we can hope to experience an unexpected boom in economic growth. Basing fiscal policy on hope is not prudent, so most observers think that the president and Congress will try to reduce spending. Agricultural spending is again on the table for budget cuts. Senator Judd Gregg of New Hampshire, chairman of the Senate Budget Committee, says that he will scrutinize farm programs and that “Agricultural entitlements are crying out to be reformed.” Farm groups are working both to forestall cuts to farm programs and to figure out where cuts should be made if they are inevitable. An optimistic way of looking at spending cuts is that they present an opportunity to improve program performance. After all, reducing farm spending will not inevitably harm farmers. For example, land owners will bear the brunt of cuts to commodity programs through a decline in land rents and land prices. Because most farmland is owned by absentee landlords, such cuts will have a smaller impact on farm operators than would seem likely. In addiGuns and Butter, Crop Insurance Reform, and the Farmer Safety Net