MAKING RICH FARMERS RICHER-NEW AMERICAN POLICY

Agricultural subsidies doled out to rich farmers in some of the wealthy countries are considered an anachronism and in spite of world wide condemnation of such practices, there does not seem to be any sign of this incongruous policy being curtailed. United States of America and the European Union countries are the major culprits in perpetuating such distorted policies. Where else except in the US farmers are paid to leave their land fallow, fearing the adverse impact a surplus production will have on the market prices of commodities? Now comes the report that the government there is debating the feasibility of new ways of subsidizing its farmers to insure them against crop failures or low market price realization for their crops. It is interesting that even some of the members of the farming community feel that such government hand out is not necessary for those engaged in honest farming. Of course genuine problems like unexpected crop failure or disasters affecting crop yields must be factored in when agriculture farming is planned and any financial help to cushion the insurance premium is understandable. How far the planned financial aid to the agricultural farms will materialize depends on the political flux this country is going through. However, most WTO members, especially the poor and the developing world, have been fighting this perverted policies of the rich nations with very little success. On the contrary the political classes in the developed economies are contriving to perpetuate this distortion by increasing the dole outs through the tax payers' money, probably for furthering their vested interests. Here is a take on this developing story.    

"Advocates, including farm interest lobbyists and lawmakers with a long history of creating and protecting benefits, argue that the new program would save Washington money by replacing a longstanding one costing $5 billion a year, known as direct payments, that pays owners of farmland a set amount regardless of whether they have planted crops. Crop insurance has existed for decades, with the government now spending about $7 billion a year to pay about two-thirds of the cost of farmers' premiums. Under the federal program, farmers can buy insurance that covers poor yields, declines in prices or both. On Tuesday, the Senate began debate on a farm bill, passed by the Agriculture Committee in April, that would set up another crop insurance subsidy, costing $3 billion a year, to cover any losses farmers suffer, known as deductibles, before their crop insurance policies kick in. The change from the existing direct payment program to the crop insurance subsidies as the primary safety net for farmers means that "payments are going to people who are actually farming," Senator Debbie Stabenow, Democrat of Michigan and chairwoman of the Agriculture Committee, said Wednesday. The Senate measure would cut about $23 billion in spending over the next 10 years, though that is far less than the Obama administration wanted. Crop insurance supporters say insurance programs provide an important safety net for farmers, who are subject to the whims of weather, pests and volatile markets. "Cuts in the crop insurance program would reduce the effectiveness of the most important risk-management tool farmers have," said Sam Willett, senior director of public policy at the National Corn Growers Association. Even some farmers argue that the subsidies are already generous to agribusinesses, especially with the government facing large deficits. Jim Faulstich, a farmer and rancher in Highmore, S.D., said he was in favor of farmers having crop insurance, but added that the insurance should not be used to make money at taxpayer expense. "If we as farmers expect taxpayers to support premium subsidies, it's only fair that we grow on land that is capable of supporting it," he said. "Could some of this land be profitable without the crop insurance subsidy? I think not."

Theoretically what any nation does within its borders is no body else's business but can such an isolationist policy work in a globalized community where cooperation and mutual help are the watch words. With what cheek countries like America, the EU, Japan and others with high per capita income, can ask the poorer countries to lower their import tariffs for industrial products manufactured by them so that their domestic manufacturing sector flourishes? Don't they know that cheap food grains produced in their countries through massive subsidies depress the global prices of many of them and hurt many countries depending on export of their surplus commodities for sustenance? With what conscience the American citizens go to sleep each day when millions of poor people starve around the world because of the subsidies doled out by their insensitive politicians? What is the use of billions of dollars worth of surplus food grains, being channelized to African countries in the name of food aid  if the huge subsidies received by the American farmers effectively kill the local agriculture? If WTO cannot stop this patently unjust policies of the rich nations, it has no right to exist any more!

V.H.POTTY
http://vhpotty.blogspot.com/
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