Cotton-Subsidy Reform Could Feed, Educate Millions
by Jasmin Malik Chua, Jersey City, USA 
on 06.26.07
Photo credit: Judy Baxter
It's time to write to Congress and ask: What's the cotton-picking idea? A substantial overhaul of American cotton subsidies in the 2007 Farm Bill could result in additional funds that could feed one million children for a year or pay school fees for at least two million children living in impoverished West African cotton-farming households, according to a new study by Oxfam America.
"Previous studies my colleagues and I have done clearly show the trade distorting effects of US cotton subsidies by lowering the world price of cotton, with results at the aggregate level," says Daniel Sumner, director of the University of California Agricultural Issues Center and one of the authors of the Oxfam report. "But these new numbers show that even a modest increase in the world price of cotton that only partly reaches the farmer could greatly improve the daily lives of some of the world's poorest people, and could literally mean that millions of poor people could be fed."
For the typical cotton-growing West African household of 10, who live on less than a dollar a day per person, cotton is often the only source of income. According to the Oxfam study, a complete removal of U.S. cotton subsidies would jack up the world price of cotton by 6 to 14 percent, resulting in a 5 to 12 percent increase in the prices that West African farmers receive for their cotton.
Additional income from increased cotton prices could have significant impact on their lives, says Oxfam, providing extra cash for covering the healthcare costs of four to 10 individuals for an entire year, food for one or two children for one year, or schooling costs for 1 to 10 children. (The country has an adult literacy rate of less than 25 percent.)
"This data clearly exposes the hypocrisy of our policies, giving international aid with one hand and taking with the other through unfair trade rules," says Raymond C. Offenheiser, president of Oxfam America. "With Congress looking at the Farm Bill right now, and renewed interest in the Doha round, this study shows how reform could help millions of poor people who are ready to lift themselves out of poverty through farming and fair trade."
American produces get more federal subsidies with each additional bushel they produce, so it should come as little surprise that farms encourage overproduction. The surplus cotton then floods the international market, lowering world prices and undercutting the livelihoods of millions of already-poor farmers around the globe—a move that is actually illegal under World Trade Organization rules.
"Any delay in reforming the US subsidy program would signal to our trading partners that the US is not serious about a new global trade agreement and, most importantly, would mean continued suffering for millions of poor African farmers who are undermined by US subsidies and dumping." continued Offenheiser. "Reforming the Farm Bill provides us with the opportunity to help more American farmers, reduce the harm of trade distorting subsidies for poor farmers overseas, and put the US in a stronger position in future international trade negotiations."
Or risk the wrath of Bono, we'd imagine. :: Kansas City Infozine
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Why are we US taxpayers subsidizing and providing healthcare/education for millions of West African children while our school system, Katrina victims, veterans, etc. all suffer budget cuts?? Where are our priorities? We are showing more loyalty to future low-price outsourcing labor than our own citizens!
If you look over USDOA cotton product ion stats the issue can be pretty much narrowed down to being caused by the Congressional delegations of two or at most three states. Texas is #1 or #2 position. Oklahoma up there too. Some from SoCal and maybe some from Arkansas.
Amazing that such a narrow interest group holds so much sway over global destiny.
I got back with some stats here:
Cotton is Texas' top cash crop, as of 2002 generating $1.6 billion annually for farmers. The crop has a statewide economic impact of $5.2 billion, including money generated by supporting industries associated with harvesting, transporting, processing and marketing cotton, according to a 2000 report by the Agriculture Program at Texas A&M University.
Texas leads the nation in cotton production and produces about 25 percent of the nation's cotton, In 2002, Texas' exported cotton was worth $426 million. California is the second-largest cotton producer, with 2002 cotton exports valued at $286 million.
So Texas combined with California exports together make around three quarters of a billion worth that gets sold on world market. Reportedly the high plains drought has taken this down a bit in the last two years, however. My point stands: it is largely a problem caused by two states. Lets get the Governator on it!
Sharon,
we spend an incredibly small amount on foreign aid relative to what we spend on domestic programs.
more importantly, we spend 530 billion per year on our military, yet less than 20 billion on foreign aid.
guess again at where all the money is going.
Aj
The article doesn't say any money will be going to Africa. Subsidies keep cotton prices lower and if Africans want to sell on the open market they have to match the lower prices or they can't find a buyer. By removing the subsidies America can no longer dump cheaper cotton on the market (like China does with electronics) and force out competition that doesn't have the backing of millions of dollars in subsidies.
I wish this article, including some specific tactics people could employ immediately, had come out last week when I posted my entry on Roundup, the birds and bees discussing the state of the us cotton industry and its perils of production. That entry attracted a lot of comments, people were looking for an outlet. I could add this entry to comments but unfortunately, what could they do anyway? this is just an article about "somebody should", rather unsatisfying. I'm still shocked and amazed that people aren't up in arms over the *inert* ingredients in pesticides that are killing fish and everything upstream.
@Kathleen:
Write to your representative! That's a proactive measure you can do.