The 2008 farm bill offends both free traders and protectionists

by

R. Dennis Olson at IATP really confuses me with this column:

The 2008 Farm Bill to be voted on by the House and Senate this week includes incremental gains for conservation, renewable energy, food aid and healthier, local food systems. However, it fails to reverse decades of deregulation that have increased agricultural market volatility to the benefit of global food corporations, and at the expense of farmers, consumers, rural communities and the environment…

These same global food corporations saw increased profits when farm prices collapsed by 40 percent after the market deregulation of the 1996 Farm Bill, and they are making even more money now that food prices have risen to crisis levels. Market deregulation in effect privatizes crucial market information, which suppresses price transparency and price discovery. This, in turn, increases the ability of big firms to manipulate prices.

I’m sorry, but what aspect of federal agricultural subsidies preclude collusive pricing? And shouldn’t the 2002 farm bill’s subsidy increases have addressed that problem? And do agro-giants really earn profits based on price volatility, making money hand over fist whether the price is low or high? What do you want the farm bill to do? Further insulate agriculture from market forces?

On the positive side of the ledger…

the Farm Bill extends the sugar program at a crucial time when it is under siege from the final phase-in of deregulation mandated by the North American Free Trade Agreement (NAFTA). It contains a new program that would use the growing sugar surpluses created by NAFTA and other free trade agreements to supplement corn ethanol production…

We fear that the deregulation of the North American sweetener market will result in the destruction of the U.S. and Mexican sugar industries…

Oh dear, it’s becoming clear now.

Advertisements