Tobacco Farmers Lose Longtime Safety Net
Tobacco growers are about to face a completely free market. This month, they'll receive their last checks from a government program meant to ease them out of a Depression-era tobacco-price-fixing system.
That has left Stanley Smith, who grows about 60 acres of tobacco on his farm not far from Winston-Salem, N.C., feeling a little unsettled.
"I've farmed all my life," Smith says. "I think the best way to sum it up is our safety net now is gone."
The safety net is the Transitional Tobacco Payment Program, also known as the buyout. Since the 1930s, the government regulated the tobacco market with a quota system. It limited how much a farmer could grow to control supply and demand, and farmers profited. That ended in 2004 with the $9.6 billion buyout program that paid growers yearly sums to help them adapt to the free market.