Organic Consumers Association


Previous Page

Click here to print this page

Make a Donation!


Two-Thirds of U.S. Farmers Get No Taxpayer Subsidies While Cotton & Grain Mega-Farms Get Billions

February 21, 2005, Issue #395
Monitoring Corporate Agribusiness
>From a Public Interest Perspective

TO RECEIVE: Send name and address


TIMOTHY EGAN, NEW YORK TIMES (February 18, 2005): Judging by the laws of
nature and the cruel twists of the farming life, Joan Lundquist is doing
just fine as she takes another stab at making a living from the rich dirt of
the San Joaquin Valley. No matter that President Bush has proposed to cut
billions from the federal farm subsidy program.

Most of her grapevines have been pruned, and the orange grove outside her
sitting room is heavy with fruit. And, she says pointedly, she does not need
a dime from the government to farm her 170 acres.

"Never took any farm subsidies," said Ms. Lundquist, who is 71 and of
19th-century California pioneer stock. "Don't plan on it. It's ridiculous.
This whole subsidy system is irritating to no end."

Farther down this valley that is the heart of the $32 billion factory of
California agriculture, John Pucheu, 61, a third-generation cotton farmer,
said he could not make a living on his patch of ground without government
payments. Mr. Pucheu's 3,000-acre farm, which he runs with his brother,
received about $1.6 million in federal subsidies from 1995 through 2003,
federal records show.

Take that money away, he said, and the Pucheu brothers might have to get out
of cotton altogether. They might even get into Ms. Lundquist's line ---
fresh fruits and vegetables. The cotton farmers mean it as a threat, not an

Why the federal government rewards one grower and ignores the other has long
been one of the more contentious arguments in rural America. But now that
Mr. Bush has proposed a curb on billions of dollars in subsidy payments for
crops like cotton and rice over the next decade, the question has roiled the
industry, setting off a lobbying struggle in Washington and threatening to
pit one type of farmer against the other.

Ms. Lundquist and most other farmers here in the nation's leading
agriculture state who grow fruits, nuts and vegetables - nearly half of all
American crops - generally get little or nothing from the government,
because they have been viewed as self-sustaining.

But growers of wheat, corn, cotton, rice, soybeans - the big commodity crops
in the world market - received the bulk of more than $130 billion given to
farmers in the last nine years, a record. The rationale for the payments has
been to keep domestic agriculture, or at least one segment of it, stable and

Critics have long said the practice created a huge welfare state among big
farmers and helped promote the megafarm at the expense of the family farm.
The administration has now proposed a cap of $250,000 a year per farmer on
government payments, and wants to close loopholes that let hundreds of
individual farmers get more than a million dollars a year in subsidies while
claiming ownership in multiple operations.

In response, some of the big growers are threatening to enter the
unsubsidized segment, possibly driving down prices for those farmers.

"Probably the best argument I can come up with for why we need to keep the
present system is that we've got 750,000 acres in cotton in California, and
imagine what would happen to produce prices if every cotton grower decided
to get into tomatoes," said Mark Bagby, a spokesman for Calcot, the largest
cotton-growing cooperative in the West.

The threats were shrugged off by the organization that represents fresh-food
farmers in California.

"The cotton industry is using the scare tactic of threatening to get into
fruits and vegetables," said Tom Nassif, president of the Western Growers
Association, which represents most California and Nevada produce farmers. "I
say let them try it. With their political power, we'd be a lot stronger."

The proposed federal cuts, amounting to about $5 billion over ten years, are
a fraction of the total paid to farmers. And the proposed caps on the
corporate farms that collect some of the highest payments would not affect
many growers in a state like Iowa, which is crucial to the political
aspirations of presidential candidates and has about 63,000 farmers who
receive subsidies. Two-thirds of the nation's farmers get no subsidies,
according to records.

Many farm-state senators have lined up heavily against the proposed caps,
leaving the fate of the Bush proposal uncertain, but if enacted, it could
represent the beginning of real change in American agriculture, many
economists and farmers say.

Subsidized farmers who grow crops that are suffering from low prices because
of a global glut may diversify, or get out of farming altogether, they say.

"The whole purpose of the farm program is to keep the grower in business,"
Mr. Bagby of Calcot said.

Cotton and rice farms, because they are such big operations, would be hit
hardest by the cuts, farm economists say. These growers received more than
70% of the $757 million given to California in subsidies in 2003, the last
year for full records.

The biggest protests are coming from cotton country, here in California as
well as in Texas and the South, because those farmers receive some of the
biggest checks.

One large cotton operation outside Fresno, the J. G. Boswell Company, has
received about $16 million in subsidies over the last eight years, according
to Agriculture Department records. The company did not return phone calls
seeking comment.

Half of all the cotton subsidies went to just three percent of the growers
of that crop, records show, with farmers in that top bracket taking in more
than $1 million apiece over the last eight years. The world is awash in
cotton, and most American-grown fiber is exported, after the collapse of the
domestic textile industry.

"Cotton is the king of subsidy-dependent American agribusiness," said Ken
Cook, president of the Environmental Working Group, which advocates an
overhaul of the farm subsidy system and publishes a list of every payment in
every county.

But cotton and rice farmers here say they need the help.

"People need to understand that the cost of producing rice is really high,"
said Bill Huffman, vice president of Farmers Rice Cooperative, which
received $134 million in subsidies from 1995 to 2003 and spread it among its
900 growers. "It couldn't be grown here, profitably, without the government

Still, many cotton growers acknowledge an image problem.

"I'm not going to kid around," Mr. Bagby said. "Wouldn't we all like to know
that a $180,000 check is out there from Uncle Sam?"

On the California farm of the Pucheu brothers, last year was a banner one,
with a big crop after a perfect growing season. But the cost of producing
the powder puffs used to make shirts and socks is much higher than that for
other crops, Mr. Pucheu said, and the price this year is low. "It cost more
than a thousand dollars an acre to produce cotton," he said. "The operations
are big. The costs are great. It's not something that many people want to
get into."

Mr. Pucheu said "nobody in the younger generation" of the family has plans
to take over the family farm. Still, his kind does not necessarily get
sympathy from fellow farmers.

Ms. Lundquist, who lives in a 100-year-old farmhouse full of grandchildren,
dogs, and memories framed on the wall, expressed disgust at the high-level
payments received by cotton and rice growers. She lives on the land her
grandparents bought in 1917 and frets from year to year with the swings in
market prices.

"Agriculture policy doesn't make any sense to me," she said. "What disturbs
me is that the small farmers are disappearing and they get nothing from the
government, while we continue to subsidize the biggest farms."

Born in 1933, in the depths of the Great Depression, Ms. Lundquist has seen
hard times and prosperous years in this valley of vines, nuts and fruits an
hour's drive south from Sacramento. She used to grow tokay grapes but tore
out all the old vines and planted zinfandel, cabernet sauvignon and

Even with the newer varietals, Ms. Lundquist said, she has endured some
recent bad years, with the downturn in prices for table wine grapes. And yet
she said she never thought of asking for money from the government during
the bad years. Feast and famine, she said with a shrug, is part of the
farmer's life. [ February 18, 2005 ]