An evaluation of Congressional Budget Office's baseline projections of USDA mandatory farm and nutrition programs

The Congressional Budget Office (CBO) projections of USDA's mandatory farm and nutrition program outlays are important in shaping US agricultural policy. Using CBO projections and observed outcomes from 1985 through 2020, we examine the degree to which projections of farm, supplemental nutrition assistance program (SNAP), and child nutrition program outlays are unbiased, efficient, and informative. We find that projections for farm and child nutrition program outlays are unbiased, SNAP outlays are unbiased at short-term but are downward biased beyond a 3-year horizon. All three series of projections are inefficient. SNAP and child nutrition program outlay projections are informative up to a 5-year horizon, but the farm program outlay projections are informative for only a 1-year horizon. Disaggregated farm program data since 2008 suggests that the uninformativeness principally stems from conservation and commodity program projections. The findings may be valuable to CBO, as they continue to improve projections, and to projection users, in adjusting their expectations.