No Costly Cotton Bailout in 2018 Appropriations!

Letter to the HillNo Costly Cotton Bailout in 2018 Appropriations!

Agriculture,  | Quick Take
Jul 25, 2017  | 4 min read | Print Article

Dear Senator,

On behalf of the millions of Americans represented by the undersigned organizations, we write urging you to oppose efforts to hijack the fiscal year 2018 appropriations process to increase taxpayer spending by padding the bottom lines of certain agricultural businesses. We are most concerned with special interest attempts to preempt the 2018 farm bill process to secure billions of additional federal tax dollars for cotton producers by making them eligible for Title 1 farm bill income subsidy programs.

Agricultural businesses producing cotton already benefit from an overly generous taxpayer-backed financial safety net. Since passage of the 2014 Farm Bill, federal spending on subsidized loans, storage, processing, and direct payments to cotton producers has totaled $2.7 billion. In addition according to USDA, nearly 96 percent of cotton acreage is covered by federally subsidized crop insurance policies. In the last five years cotton producers have received $3.13 in crop insurance payments for every $1.00 they contributed in premiums. The 2014 farm bill also created the Stacked Income Protection program (STAX), exclusive to cotton producers, in which taxpayers cover 80 percent of the cost for policies protecting against so-called “shallow losses” that are too small to trigger crop insurance payouts. The notion that cotton producers have no federal safety net is absurd.

Finally, using the 2018 appropriations process to further bailout the cotton sector will likely re-open costly and damaging trade disputes. The 2014 farm bill removed cotton as an eligible commodity for Title 1 farm bill income subsidy programs in order to resolve a long-standing World Trade Organization dispute with Brazil that cost taxpayers more than $800 million. Reneging on our agreement with Brazil by making cotton an eligible commodity under the Title 1 Agriculture Risk Coverage (ARC) or Price Loss Coverage (PLC) programs could subject United States consumers and manufacturers to billions of dollars in retaliatory trade measures directed at other agricultural commodities and industries other than agriculture. Increased foreign trade is critical to the long term health of our economy and the agricultural sector. Especially in light of recent progress made on lowering trade barriers for agricultural exports, now is not the time to revive protectionist policies for the benefit of one commodity.

USDA and the CARES Act 

We believe that it is long overdue to place faith in American farmers and treat them with the respect they deserve as sophisticated and innovative business leaders. Congress must not use the fiscal year 2018 appropriations process to surreptitiously direct billions of additional dollars to select special interests. Rather we should use the 2018 farm bill process, already well-underway, to ensure America’s agricultural businesses have the opportunity to compete and prosper in a 21st century global market by concentrating Congress’s efforts on eliminating unnecessary and complicated policies, both foreign and domestic, that manipulate market decisions by picking winners and losers in this critical and vibrant component of our economy.


American Commitment

Americans for Prosperity

Campaign for Liberty

Club for Growth


Council for Citizens Against Government Waste


National Taxpayers Union

R Street Institute

Taxpayers for Common Sense

Taxpayers Protection Alliance

Tea Party Nation

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