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Issues >
Agriculture > Printer Version $n/a
Despite the reductions promised under the 1996 "Freedom to Farm" bill, federal farm subsidies have skyrocketed in recent years, and cotton growers have benefited enormously from the recent subsidy handouts. In 1998, 1999 and 2000, emergency agriculture assistance bills increased subsidies to farmers via market loss assistance payments. According to the Farm Service Agency, producers of upland cotton received more than $5.5 billion in government payments between 1996 and 2000. In
addition, the U.S. Department of Agriculture's (USDA) subsidized
"marketing loan" program has given enormous subsidies
to cotton producers. This program allows cotton farmers to pay
back their loans to the government for less than the original
loan amount when market prices drop below the loan rate. The
government also provides subsidies to exporters and domestic
mills to help keep domestically grown cotton competitive on the
world market. Green
Scissors Proposal Current Status The
2002 Farm Bill as passed by both the House and Senate would extend
the USDA's cotton program for another five to ten years. Both
bills would provide fixed, decoupled payments (payments made
irrespective of market prices or current planting choices), counter-cyclical
payments that would kick in should commodity prices go below
a certain target price, and marketing loans. The bills are currently
in conference to iron out differences between the House legislation
and the Senate legislation. The current Farm Bill expires in
September 2002. The federal government should not interfere with market forces on cotton production. The USDA's cotton program helps create a cycle of overproduction and emergency spending at the expense of taxpayers. The overproduction helps cause lower commodity prices, which lead to less income for farmers, who are in turn bailed out by taxpayers. Since the vast majority of farm subsidies, especially for cotton, go to a limited number of already very profitable companies, these payments amount to corporate welfare. An Environmental Working Group database found that Tyler Farms, located in Arkansas - one of the biggest cotton producing states, received $31 million in farm subsidies between 1996 and 2001. The database found that at least $23 million of the payments went to the farm's upland cotton production. An earlier EWG report called "Bumper Crop" found that the average payment per recipient in 1999 was higher for cotton farmers than it was for the producers of any other commodity. Subsidies for crops such as cotton will only encourage further overproduction, which in turn will further depress prices and lead to increased subsidy payments from federal taxpayers. Program Hurts the Environment Non-organic cotton uses more insecticides than any other single crop. Each year, cotton producers around the world use nearly $2.6 billion worth of pesticides - more than 10% of the world's pesticides and nearly 25% of the world's insecticides. In California, for example, cotton ranks second among crops for total amount of pesticides used and second for causing pesticide-related health problems. Many of the pesticides used in cotton production, such as methyl parathion, among many others, have a high immediate toxicity and pose long-term threats of birth defects, cancer and other serious health problems. Such pesticides are also extremely harmful to bees, birds and fish. Cotton requires a great deal of water most of which comes from irrigation systems. Subsidies for the largest cotton farmers enable these farmers to buy or rent more land, encouraging marginal farmland to be brought into production, thereby increasing erosion and water pollution. Contacts
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