Subsidies and Our Food System

 Happy Iowa Caucus Day!

I figured today would be as good as any to review my latest disturbing food read (I'm beginning to think there isn't any other kind): Thomas M. Kostigen's The Big Handout: How Government Subsidies and Corporate Welfare Corrupt the World We Live In and Wreak Havoc on Our Food Bill. It's hard to come away from the book encouraged in any way about our political situation or how Iowa, with its lead-off caucus and soybean-corn dedication, tends to hold undue influence, but if you hang on to the end of the post, I do have some good news.

Kostigen paints a detailed, alarming picture of how the whole subsidy system, started during the Depression in good (or at least better) faith, has now become a mighty albatross around taxpayer necks and a source of anti-American ill-will worldwide. Most troubles stem from cheap Corn and Soy, whose subsidized abundance ripples through the Beef, Dairy, Poultry, and Pork industries, not to mention the totally messed-up Energy industry. (Lord, how I hate ethanol!) There are brief stops along the way in the land of Cotton, Steel, Oil, and Gas--equally fascinating and depressing.

Consider a few of the numbers Kostigen throws out there:

  • 71% of food subsidies go to factory farms, with Corn leading the way ($5B), followed by Soy.
  • Subsidized Corn and Soy means cheap agricultural feed for livestock.
  • Feed represents 60% of chicken production cost, and the price of feed has gone down 25% since the introduction of the 1996 Farm Bill. This has led to a consolidation and verticalization of the poultry industry.
    • What Kostigen calls "Big Chicken" can crank out 10,000 chickens every three weeks, in a 20,000 sq. ft. warehouse.
    • In comparison, a free-range chicken operation (which may or may not qualify for any subsidies) raises 10,000 chickens per year on 100 acres.
  •  Feed represents 85% of hog production costs. In addition to feed and environmental subsidies (pigs poop 2 to 4 times as much as humans), the government buys up excess pork. According to Tufts University research, industrial concentrated animal-feeding operations (CAFOs) receive 13% discounted operating costs over small farmers in free-range environments because of US ag policies. Never mind that hogs in CAFOs are "more likely to be exposed to H1N1 and harbor it continuously" or that CAFOs "may facilitate evolution of novel [viral] strains."
  • Kostigen also had creepy things to say about bovine growth hormone, which has been making dairy more productive since Monsanto received FDA approval for "Prosilac" (rBGH or fbST) in 1993. Since 1970, the number of farms with dairy cows has fallen from 650,000 to 75,000, but milk production has increased.
    • Cows treated with rBGH demonstrate a 50% increase in leg and hoof problems, a greater than 25% increase in mastitis frequency, and reproductive problems like infertility, cystic ovaries, fetal loss, and birth defects. Because of their increased health problems, they receive more antibiotics, contributing to greater antibiotic resistance. Cows receiving rBGH also show higher levels of hormone insulin-like growth factor 1, or IGF1, a hormone which survives digestion and enters the human bloodstream. 
    • "Numerous studies now demonstrate that IGF1 is an important factor in the growth of cancers of the breast, prostate and colon." (In some test cases, IGF1 increased the risk of cancer fourfold.) 
    • Monsanto litigated to ban dairy producers using "rBGH-free" label and won, but this ruling is being fought state by state. As you probably realize, in Washington dairy producers can still label "rBGH-free." 
    • Growth hormone is injected into 43% of cows in herds of 500 or more (USDA). In small dairies (<100 cows), the injection rate is less than 10%.
  •  The other item going into cows (and this was news to me) is cottonseed and "gin trash." The average US dairy cow eats 8 lbs of cottonseed, 75% of which is genetically modified. This stuff gets in our system, wrecks soil, and requires lots of pesticides and fertilizer. The CA EPA found the pesticides used on California-grown cotton to be very toxic, seven of which were "probably" cancer-causing, eight caused tumors, and five caused mutations. They were also rated Toxic or Very Toxic to fish, birds or both.

Now, apart from the Cotton biz (subsidized by $5B/yr), these horrors are familiar to us. There are reasons I've been buying grass-fed, free-range, and so on. What I was not aware of was the impact of US farm subsidies on the global food market.

I found Kostigen's discussion of Rice especially heartbreaking. The U.S. accounts for 12% of the world's production, and we export about half of it. Water subsidies and price supports enable American rice to be sold at prices lower than the cost of production. This means, on the global market, we can then undersell other rice-producing countries like Haiti, Ghana, and Honduras. When they impose tariffs to protect their own farmers, the U.S., through the World Bank and IMF, forces them to reduce these. Haiti, in particular, was "encouraged" by the IMF to reduce the rice import tariff from 35% to 3%. As a result, imports tripled and Haitian rice farms lost marketshare. Now 3/4 of rice eaten in Haiti comes from the U.S. That, in one of the poorest countries in the world.

The story gets repeated in different countries, with different foods. All of which contributes toward global anti-Americanism. To borrow from the Occupy Movement, to the rest of the world, we are the 1%. We use our money and our might to bully and foster economic dependence.


But I did promise a glimmer of light, so I'll skip over Kostigen's look at fishing subsidies (more depressing stuff) and point out that...drumroll, please...ONE SUBSIDY HAS BEEN ALLOWED TO LAPSE! Yes, Virginia, the thirty-year, $20 billion Ethanol Tax Credit is now history. Glory, hallelujah. The entire New York Times article is worth the read, for its anti-depressant qualities alone. As the article quotes, “The end of this giant subsidy is a win for taxpayers, the environment and people struggling to put food on the table...Production of ethanol, with its use of pesticides and fertilizer and heavy industrial machinery, causes soil erosion and air and water pollution. And it means that less land is available for growing food, so food prices go up.” If only they could get rid of the stuff altogether, but too many politicians jumped on that bandwagon and it's long out of sight. The reason ethanol producers and mixers didn't put up more of a fight? They were already experiencing a boom market, thank you very much.

So get out there and pick our next presidential candidates, you Iowans. We here in Washington usually don't have much choice by the time it gets around to us. The lesser of two evils, really.

Kostigen makes recommendations, of course. But motivating politicians of either stripe to change the system, or motivating all those recipients of subsidies to give them up for the common good sounds next to impossible, so I'll have to settle for my usual MO: encouraging people, to buy, cook, and eat real food, grown by small family farmers without government handouts or "help" from Monsanto products.