Seeking Liberty

Liberty is the Fruit from Which All Progress Grows

The Real Cost of Agricultural Subsidies

CottonBy Matthew W. Quinn

Imagine you’re a cotton farmer in West Africa.  One day, the man who comes to buy your cotton to be exported does not show up.  You go to the marketplace and find there is nobody willing to buy your cotton.  In fact, there is cheaper cotton available from abroad.

You now cannot sell your crop, or at least you cannot sell it for very much.  You need to buy food and fertilizer, and your children need medicine and money to pay for schooling.  You’re in trouble now.

Are these the workings of the free market?  No.  The reason the foreign cotton was able to price the West African cotton out of the market is because it came from the United States and was heavily subsidized.

Cotton subsidies are one of the most notorious examples of government agricultural supports and it gives American cotton producers an unfair advantage over more efficient producers abroad. For example, in Burkina Faso, it costs one-third as much to produce cotton as it does in the United States.  According to the British aid agency Oxfam, the only clear advantage American cotton growers have over competitors in Africa is their ability to get government subsidies. Read the rest of this entry »

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