An example of the WTO at work is the dispute between the United States and Brazil over American subsidies to American cotton farmers. These subsidies, in the amount of $3 billion to $4 billion a year, are illegal under WTO rules. Why would this be a problem for Brazilian farmers?

The subsidies artificially reduce the price of American cotton on world markets and hurt Brazilian cotton farmers.

The Brazilian government is less sympathetic to American domestic policy.

Brazilian farmers do not receive such compensation and are less competitive as a result.

The subsidies prevent U.S. farmers from exporting their cotton.