Magazine article New Internationalist

Robin Hood in Reverse: The Relentless Over-Production of Food in the US Is Destroying the Rest of the World's Agriculture. Anuradha Mittal Takes a Look at the Subsidies Driving It [2002 Farm Bill]

Magazine article New Internationalist

Robin Hood in Reverse: The Relentless Over-Production of Food in the US Is Destroying the Rest of the World's Agriculture. Anuradha Mittal Takes a Look at the Subsidies Driving It [2002 Farm Bill]

Article excerpt

The relentless over-production of food in the US is destroying the rest of the world's agriculture. Anuradha Mittal takes a look at the subsidies driving it.

THE 2002 Farm Bill can be best described as welfare with a difference, robbing the poor to pay the rich. While the Bill is a big bonanza for large producers of favored crops such as corn, soybeans and cotton, small family farms are shortchanged.

Vast industrial farms require costly equipment, increasing the capital intensity of agriculture. As costs rise, prices fall in markets flush with surplus. As prices fall, farmers need subsidies, which are available to big growers and agribusiness only. Land values and cash rents increase. This encourages heavy borrowing. Rich landowners get richer and young farmers cannot afford to get started. An agricultural bubble-economy is created. Inevitably it crashes as subsidies fail to keep pace with falling crop prices. Farms go bankrupt.

Under the 2002 Farm Bill, huge subsidies - $248.6 billion - will go not to farmers who resemble John Steinbeck's Joad family, but (among others) to 14 members of the Congress that crafted the Bill, to wealthy corporations like Westvaco, Chevron and the John Hancock Insurance Company, to Time-Warner entertainment executive Ted Turner, ABC correspondent Sam Donaldson and billionaire David Rockefeller of Chase Manhattan Bank. Most family farms will get nothing but a tax bill.

With American markets already saturated, the US is aggressively pushing to open up foreign markets - with great success. A quarter of American farm sales are exports already. Yet evidence from the past two decades shows that exports have not delivered on their promise. Low commodity prices have only increased the profits of processors, exporters and seed and chemical companies.

Already saturated

Not only does the Bill act as a welfare program for agribusiness, with taxpayers footing the bill - it also robs the world's poor. The US is forcing poor countries to remove subsidies and lower tariffs - while shielding itself from foreign competition by increasing its subsidies and maintaining tariffs.

Take just one example - cotton. America is the world's largest exporter of cotton, even though it is an inefficient and high-cost producer. Many US cotton growers receive half their income from the government. …

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