The Burley Tobacco Buyout Program and Its Impact on Farmers

144 Pages·2015·0.4 MB·English

by  William T. Jarrett

East Tennessee State University
Digital Commons @ East
Tennessee State University
Electronic Theses and Dissertations Student Works
5-2007
The Burley Tobacco Buyout Program and Its
Impact on Farmers in Tennessee, Virginia, and
North Carolina.
William T. Jarrett
East Tennessee State University
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Jarrett, William T., "The Burley Tobacco Buyout Program and Its Impact on Farmers in Tennessee, Virginia, and North Carolina."
(2007).Electronic Theses and Dissertations.Paper 2039. https://dc.etsu.edu/etd/2039
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The Burley Tobacco Buyout Program and Its Impact on Farmers
in Tennessee, Virginia, and North Carolina

________________________

A thesis

presented to

the faculty of the Department of Sociology and Anthropology

East Tennessee State University

in partial fulfillment

of the requirements for the degree

Master of Arts in Sociology

________________________

by

William Thomas Jarrett

May 2007

________________________

Dr. Scott Beck (Chair)

Dr. Martha Copp

Dr. Lindsey King

Keywords: Tobacco Farming, Southern Appalachia, Burley Tobacco, Buyout Program
ABSTRACT

The Burley Tobacco Buyout Program and Its Impact on Farmers

in Tennessee, Virginia, and North Carolina

by
William Thomas Jarrett
This thesis addresses the Burley Tobacco Buyout Program and its impact on three local
economies. Data collection involved obtaining information from government reports,
internet sources, public documents, agriculture offices, federal agriculture officials, and
books. Personal interviews were conducted with 32 farmers in Sullivan County,
Tennessee; Washington County, Virginia; and Watauga County, North Carolina.

This study is significant because it addresses not only the decline of an agricultural
product but also changes in a way of life in Southern Appalachia. The future of burley
tobacco growing in this region appears to be bleak because of foreign market competition
and decreasing domestic demand. From the personal interviews, many farmers had
already abandoned tobacco production and older respondents were often planning to stop
all farming practices. Specifics of the federal government-mandated Buyout Program to
compensate quota holders and growers are presented, as well as the experiences and
opinions of farmers regarding this program.

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DEDICATION

This thesis is dedicated to the memory of Joe K. Thomas III (Sonny), a relative
who was killed in a farm accident during the preparation of this manuscript, and to his
father, Joe K. Thomas, Jr., both of whom were farmers involved with tobacco production
and agriculture in general throughout their lives. Much of the material used in
researching this thesis was provided by Sonny, who was deeply involved with the Burley
Stabilization Corporation.

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ACKNOWLEDGEMENTS
I would like to acknowledge several people who have assisted me in the
preparation of this thesis. I would first like to thank Dr. Martha Copp and Dr. Lindsey
King in the department of sociology and anthropology at East Tennessee State University
for their help and support in writing and organizing this manuscript, and particularly Dr.
Scott Beck for his help and support with this thesis. I would also like to acknowledge the
many tobacco farmers and their families for their support and cooperation in willingly
agreeing to be interviewed for this study. In a similar vein I wish to extend appreciation
to the agricultural extension agents who graciously provided time to respond to my
questions and provide additional information during the course of this research. But first
and foremost I wish to thank my parents, Ronald D. and Teresa Thomas Jarrett, and our
extended family, for their help and encouragement over the many years I have been in
school from the beginning up to this point. Without them, I would have never been able
to obtain such a high level of scholastic achievement. I would also like to acknowledge
the three vision teachers who were so helpful and supportive during my pre-college
education: Nila Collins, Jann Conley, and Lee Bryan.
The completion of these degrees has been somewhat of a challenge because I

struggle with two disabilities. I have been legally blind since birth and a juvenile diabetic

since the age of eight. Upon the completion of this degree in 2007, I hope to pursue some

form of employment that will accommodate these fields of study and be feasible

considering my physical limitations.

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CONTENTS
Page

ABSTRACT ……………………………………………………………………. 2

DEDICATION …………………………………………………………………… 3

ACKNOWLEDGEMENTS ……………………………………………………… 4

LIST OF TABLES ………………………………………………………….. 8

Chapter

1. INTRODUCTION ……………………………………………….. 9

Purpose of Thesis ………………………………………………… 10

Overview of Thesis Organization ………………………………... 11

General History of the Tobacco Industry ……………………….... 13

2. THE YEARLY CYCLE ……………………………………………. 18

The History of Early Tobacco Sales …………………………….. 21

The Quota System ……………………………………………….. 28

3. RECENT DEVELOPMENTS IN THE TOBACCO
INDUSTRY …………………………………………………………. 45

Health Concerns and Costs of Tobacco ………………………….. 46

The Strategy of Big Tobacco ……………………………………. 48

4. PHASE I, PHASE II, AND THE BURLEY TOBACCO
BUYOUT PROGRAM ………………………………......................... 54

Phase I …………………………………………………………… 54

Phase II …………………………………………………………... 56

The Burley Tobacco Quota Buyout ……………………………… 58
5
Phase I in Tennessee ………………………………………. 58

Phase II in Tennessee and Introduction
of the Buyout ……………………………………………… 62

Phase I in Virginia ………………………………………… 64

Phase II in Virginia and Introduction
of the Buyout ……………………………………………… 64

Phase I in North Carolina ………………............................ 65

Phase II in North Carolina and Introduction
of the Buyout ……………………………………………… 66

Specifications of the Buyout Program …………………………... 67

5. DATA COLLECTION AND ANALYSIS PLAN ………………….. 72

Sampling Strategy ……………………………………………….. 72

Interview Structure and Recording …………………………….... 75

Tobacco Farmer Interviews ……………………………...... 76

Agricultural Agent Interviews …………………………..... 78

Analysis Plan …………………………………………………… 80

6. ANALYSIS OF INTERVIEWS…………………………………….. 81

Sullivan County Tobacco Farmer Interviews …………………… 81

Tennessee Agricultural Extension Agent
Interviews ………………………………………………………. 90

Watauga County Tobacco Farmer Interviews …………………... 94

North Carolina Agricultural Extension
Agent Interviews ……………………………….......................... 99

Washington County Tobacco Farmer Interviews ……………….. 102

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Virginia Agricultural Extension Agent
Interviews ………………………………………………………. 107

Summary of Findings …………………………………………... 111

7. SUMMARY AND CONCLUSIONS ………………..................... 115

REFERENCES ……………………………………………………………….. 129

APPENDIXES ………………………………………………………………... 133

Appendix A: Interview Guide for Tobacco Farmers …………………… 133

Appendix B: Interview Guide for Agricultural
Extension Agents ………………………………………………………. 135

Appendix C: Informed Consent Document …………………………….. 137

VITA ………………………………………………………………………….. 141

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LIST OF TABLES

Table Page

1. Estimates of U.S. Burley Tobacco Production
Over Time …………………………………………………………….. 39

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CHAPTER 1
INTRODUCTION
The process of raising Burley Tobacco is an age-old tradition deeply instilled in
the Southeastern United States. Once a top cash crop, agricultural production of tobacco
has declined significantly in value in regions of our nation. Since the inception of the
Burley Tobacco Buyout Program (October 22, 2004), also called the Tobacco Transition
Payment Program, many changes have taken place and are deeply affecting areas where
burley tobacco production was once a major cash crop. The Burley Tobacco Buyout
Program was proposed by “Big Tobacco” (Phillip Morris, RJR, Brown and Williamson,
and Lorillard, including over 300 less known tobacco companies) and by the importers
and manufacturers of tobacco products. One of the main problems encountered by
tobacco growers is the loss of income in an area that is somewhat economically
challenged anyway. Not only are the livelihoods of farmers in these areas being put to the
test, but so are the families, communities, and regional economies with ties to the tobacco
industry.
A way of life and a definitive culture are being challenged as never before.
Almost every small family farm raised some amount of tobacco or had an allotment that
increased the value of their property by allowing the owner to sell their poundage or rent
it to another farmer to raise. This, in turn, allowed farmers to pay their land taxes,
purchase machinery, or take care of any large bills which they might not have had the
funds for without profits from tobacco.
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