Michael T. Belongia and Courtenay C. Stone investigate the validity of a conventional policy recommendation among agricultural economists: that reducing the federal budget deficit is a necessary component of any effort to increase agricultural exports. While widely accepted, Belongia and Stone argue that at least three propositions must be true for this recommendation to have some legitimacy. The first two propositions require positive relationships between deficits and the real rate of interest and between the real rate of interest and the real value of the dollar. The last proposition requires a negative relationship between the real value of the dollar and real farm exports. Belongia and Stone investigate these propositions by explaining the relevant economic theory behind each and offering both simple and detailed statistical evidence regarding the predictions of these theories. Their analysis indicates there is considerable doubt that larger budget deficits have raised real interest rates and, consequently, the real value of the dollar. They do find support for the third proposition relating the exchange rate to farm exports. In view of the other conflicting evidence, however, the authors conclude that it is safe to say the relationship between budget deficits and farm exports is unresolved.