Sunday, June 8, 2008

Farmer's market

As our mothers used to remind us when we didn't finish our dinners, people are starving in (fill in country of your mother's choice.) The odds are excellent, whichever country she used as an example, that people are indeed starving there. The price of food is up significantly worldwide, and the very poor can't afford to buy it.

The reasons cited to explain high food prices include increased demand, higher costs of production because of the spike in oil prices, a drought in Australia, diversion of food crops to the production of ethanol, speculative movement of capital from erratic stock and bond markets to commodities, and more. Farmers in both the United States and Europe are earning record profits from sales -- and raking in more cash from government subsidies.

Why, you may ask, should we subsidize agribusiness when it's making record profits? You can't argue that farmers need subsidies, either to stave off bankruptcy or to encourage production.

But wait, cries the farm lobby. If you cut off our subsidies, food prices will go even higher!

On the surface, that seems like a reasonable argument. Look a little deeper, though, and you can find the holes. Farm subsidies by wealthy nations long have undercut agriculture in the developing world. When it costs less to buy cheap, subsidized imports than to grow food at home, local farmers can't compete. The only agriculture that survives is the production of cash crops like coffee, cacao, and coca. Then when imported food becomes prohibitively expensive -- as it is now -- there are no local farmers left to fill in the slack.

In the United States, even programs to provide food for famine victims in other countries have been little more than another agricultural subsidy. The food we provide to other countries, by law, must be grown in the United States and shipped only via United States shipping lines. By the time it finally arrives in, say, Africa, many of those who needed it are beyond help. At the moment, there are proposals to allow "as much as" one-third of U.S. food aid to be purchased in the area where it is needed, but the farm lobby is fighting even that.

There's no reason to think the situation will improve if Barack Obama becomes president. Obama, a loyal soldier in the service of agribusiness, fought hard to preserve the high tariff on imported ethanol when the Bush administration proposed eliminating it. (Would the Bush administration have made the proposal if there had been any real chance of passage? It's impossible to say, but I suspect the answer is no.)

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