US President Donald Trump has unveiled a $1.15 trillion budget blueprint featuring a $54bn boost in defence spending while proposing huge cuts in domestic programmes – including several that are important to developing and supporting co-operatives in the US and abroad.
The FY2018 budget, titled ‘America First‘, proposes $4.7bn in cuts to discretionary spending at the United States Department of Agriculture (USDA) – which would include the elimination of the Rural Cooperative Development Grant (RCDG), which offers development support and training for rural residents.
Ms Ziewacz added that co-ops – and the use of co-op principles – are “a time-tested strategy to stabilise economies and provide economic opportunities to families and small businesses”.
“This budget would cut deep into domestic and international communities where co-operatives are a lifeline. Now is not the time to decrease support for this effective strategy,” she said.
The Community Development Financial Institutions Fund (CDFI) programme would also be cut under President Trump’s plans. More than 280 US credit unions are certified as CDFIs.
“The administration’s dramatic reduction of funding to the CDFI Fund will negatively impact its stated goal to invest in America’s infrastructure,” said Cathie Mahon, CEO of the National Federation of Community Development Credit Unions. “CDFIs are one of the most effective mechanisms to channel capital into under-resourced communities.”
The CDFI Fund was established in 1994 and was designed to ensure that underserved communities have access to financial services. It provides financial assistance and technical assistance to certified CDFIs and emerging financial institutions. Officials from the Credit Union National Association (CUNA) and the National Association of Federally-Insured Credit Unions (NAFCU) also said they are longtime supporters of the CDFI and will fight to ensure the programme continues to be funded.
The budget also includes a $1.7bn (5.6%) decrease for energy, with a trio of energy research programmes being cut in favour of private sector research. But Jim Matheson, CEO of the National Rural Electric Cooperative Association (NRECA), reminded members that “This is only the first step in the budget process.”
“We will continue to work with the White House and Congress to reduce the burden of federal regulations while promoting research, investment and valuable ongoing partnerships between electric co-ops and government agencies,” he said.
Presidential budgets are non-binding documents that outline an administration’s priorities, which once published are referred to the House and Senate Budget Committees and to the Congressional Budget Office (CBO).