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Cotton fleece

Africa | Federal subsidies for U.S. cotton farmers don't just cost taxpayers-cotton farmers trying to eke out a living in Africa feel an even greater pinch

Issue: "Big mouth on campus," March 12, 2005

MUCHENJE, Zambia - Each square foot of Lemmy Hamufuba's 8.5-acre cotton farm can be measured in needs: school fees for five of his seven children. Vegetable oil. Soap. One more mosquito net to fend off malaria. In January, a month after planting, the Zambian farmer's tender cotton seedlings were thriving, happy portents of a healthy harvest this year.

Even so, the best price Mr. Hamufuba can get for his crop will not be the fairest. For years world cotton prices have been artificially low, depressed by government-funded overproduction in the United States. Overall, the United States provides some of the heftiest farm subsidies in the West, part of the runaway spending that has become a hallmark of the Bush administration. But this case is more than a taxpayer headache: U.S. wastefulness is causing want beyond our borders.

Now President Bush aims to slash such spending, with farm subsidies facing a pruning in his 2006 budget. The proposed caps on farmer pay-outs could save $8 billion over the next decade, says Heritage Foundation expert Brian Riedl. He dubs the subsidies the nation's "largest corporate welfare program."

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In 2001, for example, two-thirds of farm subsidies went to just 10 percent of the nation's farms. Most of them earn more than $250,000 a year. The subsidies ballooned further when Congress passed a six-year, $180-billion farm bill in 2002, the largest in U.S. history. They were part of a trend of protectionist policies that is nudging the United States out of the top economically free nations in the world, even as once-socialist countries are opening up.

These are abstract arguments for Mr. Hamufuba, who sees only what he can eke out of his roughly $850 a year for his family. Across the verdant expanse of his fields in Muchenje, about 25 miles from Zambia's capital of Lusaka, Mr. Hamufuba's wife and older daughters were cultivating their inches-high cotton seedlings. "Life here in Zambia in homes, in villages is very difficult," he told WORLD. "If you don't have something [extra] to sell like chickens, like cows, you've got a very big problem. For now, this rainy season, what can you say?"

By peasant farmer standards he is doing relatively well: Half of his income comes from being a cottonseed distributor to other farmers, from whom he earns commissions. He also dabbles in bee-keeping and banana-growing. Behind his main house-about 15 feet by 10 feet-he tends about 10 head of cattle in a wood-fence pen for his uncle. For the latest planting season, he was able to hitch two oxen to a knotted wooden yoke to work his cotton fields. Before he had the animals, he pulled his paint-chipped plow by hand.

By contrast, American commercial cotton farmers have modern gadgetry to till their soil. Machines seed and harvest, global positioning systems show how much fertilizer to sprinkle in different areas of land, and farmers work in air-conditioned tractors. About $3 billion in subsidies a year supports only 25,000 of them, concentrated in states such as Texas, California, and Mississippi. Overall farm subsidies support only five crops: cotton, corn, soybeans, rice, and wheat. The nation's other 400 crops, says Mr. Riedl, receive next to nothing.

"Farm policy is based on the premise that a surplus of crops has lowered crop prices too far and farmers need subsidies to recover lost income," said Mr. Riedl. "However, the federal government's remedy is to offer subsidies that increase as a farmer plants more crops. This creates greater crop surpluses, driving prices down even further and spurring demands for even greater subsidies. Then, after paying some farmers to grow more crops, the conservation programs pay other farmers to grow fewer crops. These policies contradict each other and make no sense."

U.S. cotton subsidies took a hit from the World Trade Organization last year, the first time the body has ruled against a member country for its agricultural policies. The ruling came after Brazil filed a complaint in 2003, charging that more than $12 billion in payments to American farmers between 1999 and 2003 had distorted competition and lowered world prices by 13 percent. The United States appealed the decision last October and a final decision is still pending.

Oxfam International, an advocacy group for poor nations, estimates that in 2001 sub-Saharan Africa lost $305 million in income because of U.S. cotton subsidies. Those in the continent's biggest cotton producers are worst hit, in the West and Central African countries of Benin, Burkina Faso, Mali, and Chad. In their case, cotton accounts for 60 percent of exports. But their export losses in cotton outstrip the U.S. aid they receive.

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