Why and How U.S. Farm Subsidies Must Be Reformed US Farm Subsidies: Goals, Realities and Prospects Will Allen & Ronnie Cummins Organic Consumers Association <http://www.organicconsumers.org/clothes/farmsubs070605.cfm>
When US farm subsidy programs began in the 1930s, the goal was to keep family farmers on the land and provide food and fiber during times of hardship, depression and war. In the late-1940s, soil and water conservation subsidies were added to preserve rural resources. Despite these lofty goals, the Environmental Working Group has shown that only 36% of US farmers currently receive subsidies while farmers in the developing world claim that US subsidies to cotton, rice, corn, sugar and soybean farmers are trade-distorting and unfair. Studies show that US subsidies depressed prices and allowed brokers to dump commodities in foreign countries at prices well below the cost of production for local farmers. Many markets in developing countries are well-stocked with indigenous foods and fiber, but are seriously disrupted by the dumping of cheap subsidized crops from the US, EU and Japan. Since 1995, more than 25,000 bankrupt cotton farmers in India committed suicide, while more than a million West African cotton growers lost their farms. More than a million corn and cotton growers in Mexico have been driven off the land and thousands have been forced to illegally cross the border, looking for work. Since 1990, almost 20,000 small and medium-sized US farmers stopped growing cotton and many filed for bankruptcy. Large farming and brokerage corporations profit handsomely from the $25 billion in annual crop subsidies and more than $20 billion in water subsidies. Most of the subsidies go to farmers who grow corn, rice, cotton, sugar and soybeans. Seven percent of US farmers received more than 75% of farm subsidies and only 2500 farmers received 78% of the cotton subsidies (more than $9 billion) during the period from 1995 to 2003. In 2003, Brazil sued the US and the EU in the World Trade Organization (WTO) over unfair subsidies for cotton and sugar growers and in early March 2005, Brazil won both cases. Following the WTO decisions the US has agreed to change its subsidy programs. But how the subsidy system is changed will bear watching and require pressure to keep it from being business as usual in a different costume. Much of US subsidy policy is justified by agribusiness as being essential to a cheap food policy for consumers and an effective trade policy for farmers. But, claims about "cheap food" are largely a myth, since enormous costs are concealed from the public. In addition to the market price, costs are added to food and clothing bills by subsidies to farmers and to brokers for marketing or exporting surplus crops. Also added are subsides for irrigation programs. Taxpayers make these additional payments for meat, chicken, cereals, processed food, rice, soybeans, grain, bread, sugar, milk, cotton and cottonseed on April 15. Taxpayers pay for the external costs of farming, including the clean-up of farmland, rivers, lakes and aquifers damaged and destroyed by farm chemical use and runoff. Taxpayers also pay for the escalating Medicaid and Medicare costs associated with high cancer and birth defect rates for farmers, farmworkers and rural residents. Add up the market price, the farm subsidies and the external costs, and America's "cheap food" becomes very expensive. It is the subsidized farmers who are using most of the chemicals and growing controversial genetically engineered crops. Agribusiness interests argue that toxic chemicals and genetic manipulation are essential if US farmers are to stay competitive in world markets. But, this is also a myth. Pew Institute researchers have shown that since 2000, US farmers lost $300 million per year in grain shipments to the EU due to the EU refusal to buy GMO corn. The State Department believes US farmers could lose an additional $4 billion per year with the recent enactment of EU labeling and identity tracking regulations for all crops. US interests decry these trends as trade distorting and unscientific. Research from the EU and elsewhere, however, has shown that GMO crops have already caused life-threatening allergic reactions, a sharp reduction in beneficial insects and soil organisms, damage to the vital organs of test animals, an increase in the use of weed killers and a 75% reduction in this year's monarch butterfly population. At the same time that America's chemical and genetically engineered export markets are in serious decline, organic markets are rapidly increasing around the world. Tens of thousands of farmers in the US and overseas have converted to organic production. Many are looking for new markets, better prices, and how to farm without pesticides, chemical fertilizers, hormones, antibiotics and GMOs. While the shelf price for organic food is slightly more expensive, we would argue that when you consider all the hidden costs for taxpayer subsidized, chemical-intensive and genetically engineered food, organic food is cheaper. US organic farmers have made impressive gains in cleaning up millions of acres of cotton, corn, rice, soy, and vegetable land that were contaminated by toxic pesticides and chemical fertilizers. Until now, farmers learned how to reduce or eliminate toxic chemicals at their own expense, without the help of subsidies. A revamped subsidy system could assist farmers in making those transitions, help rebuild rural America, eliminate agricultural pollution, improve public health, and reduce our escalating medical bills. The recent WTO decision against US cotton subsidies provides farmers and taxpayers with an opportunity to implement long overdue changes in the subsidy programs, and redirect the program towards its original goals. Subsidies should be available to all farmers (with strict acreage and dollar limitations) who are willing to make a transition to sustainable farming practices that promote public health and conserve vital resources for our children and future generations. Fortunately, many sustainable farming and resource conservation initiatives already have been enacted into Federal law, such as the Conservation Security Program, Environmental Quality Incentives Program, Conservation Reserve Program, Special Practices Programs and renewable energy incentives. Unfortunately, Congress and the Administration have consistently under-funded or not funded these sustainable initiatives. Instead, they've used our tax dollars on pork barrel subsidies for wealthy farmers and exporters. Subsidy programs that help farmers make the transition to less toxic farming should be the centerpiece of our next Farm Bill. Taxpayer giveaways to rich US farmers and brokers are no longer acceptable to the WTO. They should no longer be acceptable to US taxpayers. ### OCA's supports limits on subsidy payments to large farms as the first step in a major reorientation of our annual $20+ billion farm subsidies program that would eliminate "non-green" subsidies and replace them with subsidies that help family farmers and ranchers make the transition to organic production, renewable energy, and development of local markets. We also need a major increase in food stamps so that low-income Americans can afford to buy healthy organic food for themselves and their families. -- Alexis Baden-Mayer, Esq. Organic Consumers Association 1858 Mintwood Place, NW #4 Washington, D.C. 20009 Office 202-232-8997 Fax 202-232-8340 Mobile 202-744-0853 _______________________________________________ Biofuel mailing list Biofuel@sustainablelists.org http://sustainablelists.org/mailman/listinfo/biofuel_sustainablelists.org Biofuel at Journey to Forever: http://journeytoforever.org/biofuel.html Search the combined Biofuel and Biofuels-biz list archives (50,000 messages): http://www.mail-archive.com/biofuel@sustainablelists.org/