Wednesday, November 07, 2007

corporate welfare, rural version

We're not really quite the free market economy we pride ourselves on being in the United States. For example, some key agricultural products are given subsidies by the Federal government. As Michael Gerson writes, cotton is a particularly egregious example - American cotton farmers, average income over $125,000 a year, get guaranteed 72 cents a pound for cotton when the world price is 57 cents.

Who pays? Well, for starters the American taxpayer. And any American consumer that buys cotton products.

And the poor cotton farmers in places like Benin, Burkina Faso, Chad, and Mali (all in West Africa). Our subsidies drive up US production, driving up global supply and therefore pushing down global prices. And the cotton farmers of West Africa, who needless to say don't get subsidies and don't make $125,000 a year, are screwed.


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