By former USDA Secretary John R. Block.
We are trying to survive a global pandemic, trade disruptions, and trade conflicts. Farm bankruptcies have been increasing for 5 years in a row. And they are expected to continue to climb in the next 12 months. Thank you to the federal government - farm support payments have jumped from $11.5 billion in 2017 to $32 billion this year. However, the government cannot and will not keep this up. It is not sustainable. The Congress is supposed to pass the appropriations bill for next year’s spending. But, I do not expect them to get it done on time. At this point the House is going to vote on their bill next week. I do not know when the Senate will get their work done. Then the bills will have to be negotiated. They will not get that done. Federal government funding expires in 11 weeks. Then we can expect a stop gap spending bill which will fund our government at current levels until after the election in November. Everything in this town is tied up in politics now.
Even with all the federal money already spent there is political support for another relief package. I realize that agriculture spending is high, but we have been throwing money at everything. Our government deficit spending surpassed $3 trillion over the past 12 months. That is the largest annual deficit as a share of the economy since World War II. The Congressional Budget Office projects the annual deficit could total $3.7 trillion by the end of this fiscal year Sept 30.
It will be more than that if Congress passes another emergency spending bill. I think that we all realize and accept the fact that it’s going to cost money to get through this recession. We have very low interest rates, but how much can we borrow? Is it no big deal to just print money or do we have to pay it back? Of course, our children and grand children can do that. I think our government has done a pretty good job of limiting the recession pain, but there has to be a limit.
John Block was Secretary of the U.S. Department of Agriculture from 1981-1985, where he played a key role in the development of the 1985 Farm Bill. If you would like to review his radio shows going back more than 20 years, just go online to www.johnblockreports.com.