The Economy

Rural America is one of the most productive regions in the world, providing vast quantities of food and agricultural goods for the world. The American agricultural sector generates over 17 million jobs and makes roughly 5.7% of the country’s GDP. Therefore, it is essential to create a fair and competitive economy that is conducive to the dynamic economic needs of rural America.

The United States has the safest, most abundant and diverse food supply in the world and we must work hard to defend this reputation and spread our goods across the globe. Our economy is more interconnected than ever, which requires a smart, integrated trade policy that recognizes the diverse and unique interests of rural America. The Grange supports the President’s decision to withdraw the United States from the Transpacific Partnership and focus on one-on-one negotiations with international trading partners. We continue to encourage outreach with other nations across the Pacific and Atlantic in order to connect rural areas with distant markets with a growing appetite for American agricultural commodities. NAFTA, the trade agreement signed over two decades ago between Canada, the US, and Mexico has overall been a boon to American agriculture. However, the Grange recognizes that not everyone has prospered under NAFTA, and other multinational agreements. Thus, the Grange is open to renegotiating NAFTA, but it must be done with great care not to disrupt previous gains made in agricultural industry.

Although tax policy has long been a divisive issue, there is overwhelming consensus that reform is long overdue. Tax reform is particularly important to rural America because agriculture is a high-risk and capital intensive industry at the mercy of drastic cyclical changes. The Grange advocates for a number of reforms that takes into account these conditions and the everyday obstacles that characterize rural America.

Given the distinct features of the agriculture industry, the Grange supports implementing the cash accounting method over traditional accrual accounting. Cash accounting is more accommodating to the capital intensive nature of agriculture because it recognizes revenues and expenses in real time as transactions are completed, as opposed to when they are initiated. We also support interest expense reductions to help families cope with the interest they incur from borrowing large sums of capital. Interest should be seen as another essential input to cultivating their final product and, therefore, be eligible for deduction as an expense.

In order to protect the property and livelihoods of rural families, the Grange supports the complete repeal of the Death Tax. Unfortunately, when some families are faced with the tragic death of a loved one they are required to pay steep taxes on the property they inherit, which often forces them to sell assets and take out loans. In order to keep families afloat and preserve the legacy of multigenerational family farms, the death tax must be eliminated. Implementing the stepped-up basis for property appreciation will also address the needs of rural families recovering from the loss of a loved one by limiting the amount of property value appreciation subject to capital gains taxes if inherited assets are sold.