LUBBOCK, TX (KCBD) - Local farmers could lose thousands of dollars if a proposal by President Barack Obama is passed. The proposal will end direct government payments to large U.S. farmers.
How this proposal works is if farmers make $500,000 or more in annual sales then direct payments from the government would be cut off, and this would be bad news to hundreds of farmers here on the South Plains.
Wally Darneille has been in the cotton industry for more than 30 years. "Our farmers create employment they create export and they take tremendous risks that require tremendous capital so limiting them on the basis of gross sales is, as I said in my speech in Washington, I think un-American," said Darneille, president and CEO of Plains Cotton Cooperative Association.
Darneille is not too pleased with President Barack Obama's new proposal. Currently, farmers receive various forms of payments and one is a direct payment from the government. This is received regardless of the amount of crop that is produced. Obama is proposing to end direct payments to farmers whose annual sales are $500,000 or more. "$500,000 in gross sales represents about maybe 1,500 bales of cotton and that's not a huge amount," said Darneille.
In fact, Darneille says this would affect 126,000 farmers nationwide.
"In the government payments that come those farms, of course, it's going to affect their bottom line profitability and the ability to make a living," said Darren Hudson the Larry Combest Chair of Agricultural Competitiveness.
Hudson with the Department of Agricultural and Applied Economics at Texas Tech says this would affect 100 farmers alone in Lubbock County. "What's happening here is you're just picking a group and excluding them from receiving government payments. There is no benefit. None of the other farmers get more payments none of those trade-offs exist, basically what is happening is the Obama Administration is looking for dollars in order to fund some its other programs," said Hudson.
Hudson adds the average Lubbock County farmer makes $80,000 a year and $25,000 of it is a direct government payment.
Both Hudson and Darneille agree they see this as just a proposal. "It's already gotten a lot of criticism from both democrats and republicans," said Hudson.
"I just think it's very counterproductive to come to farmers who get a very minuscule amount, bear in mind we are talking about a very small amount of money in the greater scheme of things so I don't think that this will succeed," said Darneille.
If Obama's proposal passes, then it would counteract the current farm bill. Right now, farmers are under a five year bill that congress passed last year which does include government direct payments.
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