Publication: Business Authority
Paper Section And Page: 21
Paper Date: Mon, Jan 1, 2001
Category: Business Authority
Byline: Tony Best
IF only most Caribbean nations would listen to the Americans when they come with advice on agriculture.
For years, United States experts have been telling sugar producing nations in the region that they should find alternative crops that are more lucrative regionally and internationally than what was being produced and exported.
And if the soil was unsuitable for crops other than sugar, then, they should introduce rapid modernisation to cut production costs, the advisors insist.
Take the case of bananas. That crop, according to some Americans, is a losing proposition. In the case of sugar, they tell Caribbean governments, the production costs are too high, that's true. They also say that the European banana regime which keeps the industry alive in St. Lucia, St. Vincent, Dominica, Jamaica and Grenada is too discriminatory, thus penalising low cost bananas grown in Central America, that's untrue.
That argument was used, in part, to justify Washington's destructive and wrong-headed decision to drag the European Union and by the extension the Caribbean nations before the World Trade Organisation.
In addition, some of America's agriculture specialists insisted that subsidies and financial help to farmers were dead wrong, unproductive they often said.
"They tried to get us to stop doing all the things which have worked for us in the past," complained an agriculture minister in the Eastern Caribbean.
Should the Caricom nations listen to the Americans? Not if the quality of a country's advice is measured against its own performance.
Vast sections of America's agriculture are only surviving because the United States government is subsidising the crops and the farmers' lives.
During the current fiscal year, the federal government plans to spend US$51 billion to subsidise the industry in several states, including Montana, Missouri, Illinois and Iowa.
The situation has grown so bad that direct payments to farmers this year will amount to US$28 billion or half of the total income of rural farmers.
So while American experts and government officials are trotting around the Caribbean, Latin America, Africa and the rest of the world advising farmers and governments on cost-effective production techniques and marketing strategies to boost farm income, their agricultural industry is in a mess.
Chouteau County, a wheat producing area of Montana, is an example of what's happening. The rural farm belt whose population is about 5 000 received more than US$51 million in government money or approximately $102 000 for every man woman and child in the county, last year. Some farmers received more than $600 000.
That money wasn't paid to guarantee a steady supply of wheat. Instead, it was handed out to support the wheat farmers, many of whom reduced the amount of land they hand planted.
But Chouteau County isn't alone.
For instance:
- More than 1.5 million farmers throughout the United States were paid on average about $13 000 each last year. Now that the United States Congress has increased the level of support they can receive, each can be paid as much as $280 000.
- Farmers in Texas, the home state of President-elect George W. Bush, are going broke at an alarming rate and are becoming increasingly dependent on government handouts.
- Rural counties across the land received $28 billion in farm aid last year and few people in Washington can say what the taxpayers receive in return.
- Government officials indicate that some farmers receive $40 000 for being in business, $50 000 for taking land out of production, $100,000 for failing to earn a profit on their operations in a year and $40 000 for bad market conditions and other "emergency" situations.
- Four years after the United States Congress passed a farm bill designed to reduce aid to farmers, direct payments to them have tripled since 1996.
- Farmers who grow rice, apples, wheat, you name it, are receiving large sums of money, often for doing very little, except devising ways to receive more farm aid.
- Most of the wheat grown with United States government subsidies is geared for export to developing countries, Eastern Europe and elsewhere.
"Perhaps never in the history of a nation founded by agrarian self-starters has the federal government propped up rural America to such a degree," observed a national newspaper.
And with that propping up, has come a sense of dependency, something which the white rural farmers complain about when they see it in poor urban communities, especially in Black and Hispanic neighbourhoods.
"Virtually every farmer in the country is on the dole in one form or another," complained Clarke William-Derry, a senior analyst with the Environmental Working Group, a research organisation.
"It's social engineering with nobody at the switch," he added.
Dan Glickman, who as Secretary of Agriculture is the equivalent of a minister of Agriculture in a Caribbean nation, put it differently.
He described farming as "largely an income transfer programme" that requires little, if anything at all, in return from the recipients of the government's largesse.
Glickman rationalises this form of farm welfare by asserting that thousands of farmers and their businesses that depend on it would go belly-up without the handouts.
The businesses that rely on the money from the government and that would face bankruptcy range from banks and insurance companies to supermarkets as well as hospitals and schools.
But living on government handouts doesn't mean a tough life for all the farmers.
Some of them use their government cheques to go on European vacations, live in expensive homes and buy large vehicles.
What's interesting about this picture in a section of the country which is one of the world's major grain producers is that the Republicans who are constantly inveighing against welfare cheats and others who abuse the system in urban centers have been silent supporters of this burgeoning farm aid program. They keep their mouths closed because of the political support they receive from people who like to talk about independence and the value of free enterprise.
Even the Secretary of Agriculture was forced recently to point out that something was radically wrong with the programme as it is presently structured.
"Essentially, the government role in requiring the farmer to do something in return has been largely eliminated by the Congress," he said.
"It is important enough for this country to keep rural communities going. And while I don't like the large payments going to some farmers - that's an outright embarrassment - many of these payments are keeping large sections of rural America from folding up and going down."
You would think that a country which isn't reluctant to go to the WTO about Caribbean bananas and which subsidises its sugar industry by restricting the entry of foreign sugar into its market, would be acting different.
The irony about what is happening in the United States is that Europeans are also subsidising their agriculture, much to the chagrin of the Americans.
This brings us back to Caribbean agriculture. The region's industry is facing a fork in the road.
Grenada's Prime Minister, Dr. Keith Mitchell, said recently that the region's inability to finance agriculture through domestic support programmes, even where such programmes were WTO (World Trade Organisation) consistent had left the country at a tremendous disadvantage."
Jamaica's leader, P.J. Patterson, who called "the lifeblood of our economy, both as a source foreign exchange and livelihood, as a critical element in food security, has called on the new Bush administration to settle the banana issue with Europe.
In Barbados, the government must make a crucial decision about sugar - how many factories the country can afford to maintain - and the Europeans and the African Caribbean and Pacific States must decide the future of the sugar protocol.
With the Europeans now pushing ahead with a plan called "Everything but arms" - meaning that the every product from soup to nuts, but excluding guns and bullets would be allowed in duty free from the world's poorest countries- Guyana is worried its rice exports to Europe, and almost every Caribbean state is on edge about the future of their rum.