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Action on Smoking and Health
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US Tobacco Farmers Consider Giving Up Crop Limits and Price Supports [08/20-3]
Excerpts from: Tobacco Growers Consider Giving Up Price Supports
By CARL HULSE NY
TIMES [08/20/03]
With foreign competition increasing and their income falling steadily, tobacco
farmers along with the senators from tobacco country say they are prepared to
do something that would have been unthinkable only a few years ago: give up
the government crop limits and price supports they have enjoyed since the Depression.
In what could be a turning point for the government's role in tobacco production, many pivotal senators have joined with farmers to press for a buyout of tobacco quotas by the industry, ending the federal program that determines who can grow tobacco and how much they can sell. In return, the Food and Drug Administration would gain the authority to regulate tobacco products under a legislative plan that Congress will consider this fall. That would give the agency power it sought in 1996 only to have the Supreme Court rule that it had exceeded its authority.
Joined by senators from Georgia, North Carolina, South Carolina, Tennessee and Virginia, Mr. McConnell and his fellow Kentuckian Jim Bunning in late July introduced a $13 billion proposal to retire the vestiges of the program created seven decades ago to fix the tobacco supply and guarantee a minimum price. The buyout money, to be paid over six years, would be tied to the prices paid for tobacco last year and come from an assessment on importers and domestic manufacturers of tobacco products. Senator Elizabeth Dole, Republican of North Carolina, another chief sponsor of the measure, has estimated that the amount of tobacco allowed to be grown has been cut by 50 percent over the past six years."We've got a lot of farmers, if it doesn't happen this year, they will be bankrupt," said Brian L. Furnish, director of government relations for the Burley Tobacco Growers Cooperative Association in Lexington, Ky.
He estimated that under the buyout, tobacco growers in Kentucky would get an average of less than $7,500 a year compared with $10,000 annually that producers of other crops get under farm subsidies, though some large tobacco farmers and holders of tobacco quotas would receive substantially more.
A large segment of the tobacco industry says that if the proposed buyout does happen, the industry will face serious financial troubles.
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