Agricultural subsidy
From Free net encyclopedia
An agricultural subsidy is a governmental subsidy paid to farmers to supplement their income, help manage the supply of agricultural commodities, and bolster the supply of such commodities on international markets. Examples of such commodities include wheat, feed grains (grain used as fodder, such as maize, sorghum, barley, and oats), cotton, milk, rice, peanuts, sugar, tobacco, and oilseeds such as soybeans.
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Agricultural subsidies by region
United States
The U.S. Agricultural Department is required by law to subsidize over two dozen commodities. Between 1996 and 2002, an average of $16 billion/year was paid by programs authorized by federal legislation dating back to the Agricultural Adjustment Act of 1933, the Agricultural Act of 1949, and the CCC Charter Act of 1948, among others.
The beneficiaries of the subsidies have changed as U.S. agriculture changes. In the 1930s, about a quarter of the U.S. population resided on the nation's six million small farms. By 1997, 157,000 large farms accounted for 72% of farm sales, with only 2% of the U.S. population residing on farms.
Congress has made dozens of changes to the program over the years, as agricultural policy and the economy has changed. One of the more recent acts was the Farm Security and Rural Investment Act of 2002, which is in effect until 2007.
Currently (as of Nov. 2005), the USDA (United States Department of Agriculture) forecast for the fiscal year 2005 is for a trade surplus of $4.5 billion with $62 billion in exports. (-source: American Institute for Economic Research (Great Barrington, MA, USA) research report, vol. LXXII No. 22)
European Union
Japan
Agricultural subsidies by crop
The New York Times reported on December 8, 2005 that corn subsidies had reached $20 billion per year in the United States and as much as $85 billion per year in the European Union.
Criticism
The main criticism of these programs is that they promote poverty in developing countries since those economies depend on their agricultural production and they can't compete with subsided and therefore low priced commodities. Another criticism is that the same funds could be spent on other government activities such as crime control, education, military defense, etc.
See also
Reference
- Farm Commodity Programs: A Short Primer, a Congressional Research Service Report for Congress, June 20, 2002.es:Subsidio agrícola