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Trump's budget weakens farmers' safety net

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Phillip Sylvester
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President Trump’s proposed spending plan includes major cuts to the Department of Agriculture, especially in the way of crop insurance subsidies.

 

Crop insurance protects farmers if extreme weather destroys their crops, or if farmers end up spending more to grow their food than they can sell it for.  

 

Trump’s proposed budget would cut crop insurance by about $28.5 billion over 10 years, which is about a 36 percent reduction.

 

Delaware’s Agriculture Secretary, Michael Scuse, said that would drive up premiums and possibly force some farmers out of business.  

 

“If you look at the production costs our producers are facing today, there aren’t the profits there for them to absorb the additional cost,” he said.

 

A rise in premiums would disproportionately affect young farmers, who carry more debt and less liquidity than their older counterparts, according to Richard Wilkins, a Delaware farmer and Chairman of the American Soybean Association.  

 

“We have this problem of the average age of the American farmer being 57-58 years old, and a lack of new entrants into this industry could be an unintended consequence of this proposal,” he said.

 

Wilkins said another unintended consequence could be destabilizing the entire crop insurance market. That’s because farmers would have to choose between paying higher premiums or forgoing insurance.

 

Wilkins said veteran farmers who have never filed a claim would be tempted to pull out of the market, leaving only the farmers who file claims regularly. And that would possibly drive up premiums even more.

 

Agriculture is the number one industry in Delaware, accounting for $8 billion a year in economic activity.

 

Scuse said any impact to that industry would hurt the state’s economy. 

 

Congress actually writes the budget so Trump’s proposal is almost certain to change.

 

"I don't believe these proposals will get many salutes in Congress," Wilkins said.

 

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