06 September 2012

News flash—U.S. corn growers oppose subsidy

American farm policy has been described as "a bi-partisan pork-barrel boondoggle." Critics claim that massive subsidies reward mainly corporate farms (through 1995 to 2010, the top 10 per cent of farmers collected 74 per cent of all subsidies) while undermining farmers in the Third World. For example, NAFTA allowed cheap, subsidized corn to pour into Mexico from the U.S., undercutting Mexican farmers and costing millions of farm workers their livelihoods.

Now, surprisingly, the National Corn Growers Association, one of the country's largest agricultural lobby groups, is calling for an end to direct farm subsidies. A spokesman for the group said this is not the time for the government to be spending $5-billion per year directly subsiding corn farmers regardless of prices or yields.

They are not calling for an end to all subsidies, just direct subsidies. They continue to support others, such as price supports and crop insurance. These will cost nearly $10-billion per year, roughly the same as direct subsidies.

Nonetheless, it is refreshing to see at least one group within the industry itself calling for an end to policies that have proven unwise both domestically and internationally. Whether or not politicians will agree and unwind one of their favourite means of funneling federal dollars to their states and districts is quite another matter. Mitt Romney, for instance, a great proponent of the free market, has referred to farm subsidies as a matter of "national security."

We might also ask if Europe, an even greater subsidizer than the U.S., will pay attention. After all, agricultural subsidies consume 40 per cent of the European Union's total annual expenditures (including $683,000 per year for Queen Elizabeth).

Ending agricultural subsidies in the West would probably do more to help the Third World's economies than foreign aid. The Western taxpayer would doubly benefit—by ending subsidies and reducing aid. And we could end the current hypocrisy of benefiting the West with free trade for our manufactured goods while disadvantaging the Third World by protecting our agriculture. The Corn Growers deserve praise for a small step in the right direction.

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