Tuesday, April 25 was a busy day for agriculture in Washington -- with Sonny Perdue confirmed as Secretary of Agriculture, President Trump hosting a “Farmers Roundtable” and signing an Executive Order creating the Interagency Task Force on Agriculture and Rural Prosperity, which borrows somewhat from the Obama administration’s Rural Taskforce.
With the first 100 days of his Presidency coming to a close, the White House perhaps sought to burnish its reputation on several of the issues that brought Trump to office – including rural development and the state of the ag economy. With strong support from rural America, many assumed that a Trump presidency would be a boon to rural communities.
However, the President or his advisors’ statements and budget proposal have caused confusion and consternation in rural circles. USDA faces a 21 percent cut in the President’s ‘skinny budget’; bipartisan supported programs that assist rural communities, such as the Appalachian Regional Commission (ARC) and the Low-Income House Energy Assistance Program (LIHEAP) would be completely eliminated. Shifting priorities on trade, immigration and biofuels have left the ag community wondering what, exactly, are the President’s priorities for rural America.
At the Farmer’s Roundtable, and in the Executive Order, several issues that impact agriculture were mentioned, which one can expect to continue to play out at both the agency level and in the Congress:
- Trade. With Trump’s position on trade changing seemingly every day, Trump discussed making trading more favorable to U.S. producers. Stating that he “has no fear” of a trade war with Canada, since “They have a tremendous surplus with the United States. Whenever they have a surplus, I have no fear.” The White House has now walked back previous statements on ending American involvement in NAFTA. In 2015, the U.S. exported $24 billion in agricultural products to Canada and $18 billion to Mexico.
- Regulations on the farm economy. In the Executive Order, Trump tasks Perdue and various agencies to “eliminate unnecessary regulations that hurt our nation’s farmers and rural communities.” So far, the White House has tasked EPA and the Army Corps of Engineers with reviewing and possibly rescinding the Waters of the United States (WOTUS), which was finalized under the Obama administration.
- Immigration. With large swaths of the ag economy relying on immigrant labor, the agriculture community is uneasy with Trump’s talk on immigration. He reiterated his support for building a border wall between Mexico and the United States on Tuesday, despite concessions to Capitol Hill that he would sign a spending package that increased border security versus constructing a wall.
- Tax reform. While substantive tax reform discussions have not begun on Capitol Hill, the President unveiled his proposal for tax reform Wednesday. Among other things, it proposes to to end the estate tax (or so called “death tax”), paid by individual estates valued over $5.49 million. While it’s estimated that only 5,200 of the estimated 2.7 million estates in 2017 will be eligible for estate taxes, its repeal has been a priority of several ag groups.
The Task Force on Agriculture and Rural Prosperity is similar to Obama’s Rural Council, though with a particular emphasis on deregulation being the main mechanism to stimulate rural economies. The Task Force will, “identify legislative, regulatory, and policy changes to promote in rural America agriculture, economic development, job growth, infrastructure improvements, technological innovation, energy security, and quality of life.” In February, USDA reported that net farm income is expected to decrease 8.7 percent in 2017, net farm income has dropped each year since 2013. The Task Force includes 21 federal agencies, including Treasury, Defense, Interior, Labor, Health and Human Services, Energy, Education, EPA and the Federal Communications Commission.
Lawmakers on both sides of the aisle have stressed that Perdue has a tall job ahead of him -- defend the USDA against the budget cuts proposed by the Trump Administration, the faltering state of the ag economy and consolidation in the ag sector. Senate Agriculture Committee chairman Roberts (R-KS) commenting, “Now more than ever, agriculture needs a voice and a champion at the highest levels of government. Perdue fills that role.” Ranking member Stabenow (D-MI) commented, “Rural America has been waiting long enough for a leader at USDA.” Perdue is the last cabinet-level position to be confirmed in the Trump administration.
In examining the conflicts between Trump’s campaign rhetoric on rural communities and actions thus far, Senator Tester (D-MT) perhaps sums up the disconcerting actions of the Administration best, saying, “the White House’s budget will be a nail in the coffin for rural America… Gov. Perdue is a stand-up man. I’m more than willing to give him a fair shake. I expect Gov. Perdue to hit the ground running.”
For more information see:
- Presidential Executive Order on Promoting Agriculture and Rural Prosperity in America, The White House
- Remarks by President Trump in Farmers Roundtable and Executive Order Signing Promoting Agriculture and Rural Prosperity in America, The White House
- New Ag Secretary Faces Challenges, The Progressive Farmer
- How Many People Pay the Estate Tax?, Tax Policy Center