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USDA Subsidies Funding Toxic & Corporate Agriculture

Pesticide Action Network Updates Service

Subsidies Increase for Industrial Agriculture
November 11, 2004

Farm policies are squeezing small U.S. family farms out of business and fail
to support non-traditional practices such as organic farming. Even though
organic farming is one of the most promising and fastest growing agricultural
sectors, federal subsidies continue to promote industrialized agriculture that
places profit before sustainability and relies on pesticides and unproven
genetically modified organisms.

The United States Department of Agriculture's (USDA) most recent agricultural
census shows a drop in the total number of U.S. farms while gross output
remains stable, suggesting that production is consolidating in a smaller group
of large farms. For example, in the past five years, the number of farms
producing rice has fallen by more than 16%, as more than 1,500 farms have
closed. Gross national rice production, meanwhile, has increased by 14%.

USDA funding practices, meanwhile, place a greater percentage of subsidies
with a smaller percentage of farms. In 1995, the largest farms received $3.98
billion, or 55% of all federal farm payments. In 2002, their portion increased
to $7.8 billion, or 65% of all federal payments. Almost 30% of agricultural
subsidies go to the top 2% of farms and over four-fifths of subsidies are
awarded to the 30% largest farms in the nation.

While traditional family farms are closing, sustainable and organic farming
practices are rapidly expanding with certified organic acreage doubling
between 1992 and 1997 and doubling again between 1997 and 2001. Organic
lettuce acreage now accounts for 5% of the nation's total, and 4% of carrot
acreage is certified organic.

Yet the only government funding currently committed solely to organic farming
is a certification cost share program established in the 2002 Farm Bill to
support growers, handlers, and retailers seeking organic certification from
the USDA. Five million dollars of the Farm Bill's $248.6 billion budget is
available through this program.

Other federal programs designed to support struggling farms or promote
environmental conservation often do not reach those most in need. Most
subsidies issued by the Environmental Quality Incentives Program (EQIP), a
Bush Administration initiative that directs 60% of its funds towards helping
livestock producers meet environmental regulations, end up in the hands of
large-scale farms, because only operations with more than 1,000 animals are

The Conservation Security Program (CSP) in the 2002 Farm Bill provides
significant support for sustainable farming practices, however USDA has waited
two years to implement this program. According to the Land Stewardship
Project, USDA CSP draft regulations limit the program to eligible watersheds,
do not provide enough cost incentives for farmers and ranchers, require some
farmers to wait eight years to apply, and discriminate against farmers on
smaller acreages engaged in highly effective conservation management.

Crop insurance and disaster payment programs are also biased against
non-traditional farming practices. Insurance companies generally use
pesticide-based farming as their best-practice standard to determine premiums
and reimbursements. A lack of research-based standards for organic yields and
crop values makes it difficult to determine what constitutes a disaster and
just how much money the farmer lost. The emerging threat to organic farms of
contamination by nearby genetically modified crops is also not covered.

While farming subsidies remain stagnant, funding for research into organic and
sustainable farming practices has shown modest gains. Two competitive
grant-making programs, the Organic Transitions Program and the Organic
Research Extension initiative of the 2002 Farm Bill provide a combined $5
million dollars per year while the USDA's Agricultural Research Service has
dedicated about $3 million per year to researching organics. Still, the $3.5
million spent by the ARS in 2003 represents a disproportionately small one
third of one percent of its annual budget. Based on relative market size,
organic farming should receive at least three times that, or 1.8% of the

Sources: Organic Farming Research Foundation. Information Bulletin. Winter
2004, and Fall 2004 Available at ; Common Dreams. More
Family Farmers Failing Under Bush Administration - Small Farmers Struggle as
Programs Benefit Corporate Agribusiness. 09/31/04,
; Land Stewardship Project, ; USDA
National Agricultural Statistics Service. 2002 Census of Agriculture, .

Contact: PANNA

PANUPS is a weekly email news service providing resource guides and reporting
on pesticide issues that don't always get coverage by the mainstream media.
It's produced by Pesticide Action Network North America, a non-profit and
non-governmental organization working to advance sustainable alternatives to
pesticides worldwide.

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