By Pam Linn


Of farm subsidies, energy and food aid

Correct me if I’m wrong, but as Congress debates the Farm Bill it seems energy issues are inextricably linked. Combining the two may give Congress an unusual opportunity to advance clean energy development but only if they can separate the wheat from the chaff, so to speak.

Energy Title programs in the Farm Bill, such as the Rural Energy for America Program (REAP), can be a good thing in that they’re crucial to developing locally owned wind, solar, geothermal and other renewable energy projects in rural communities through grant assistance.

In a year when farmers have seen record crop prices and better than average yields, subsidies-long a subject of debate among legislators, economists and free trade policy makers- may alleviate rising fuel prices and dependence on foreign suppliers. But subsidies have evolved in an insidious way from aid for struggling small farmers to a form of socialized medicine for agribusiness. It’s not hard to see that Archer Daniels Midland and Cargill could thrive without our tax dollars.

Now the cotton subsidy program is enmeshed in a global trade battle. The World Trade Organization ruled subsidies to American cotton farmers broke international trade laws, opening the door for foreign countries to levy billions of dollars in penalties against the U.S. The Senate bill leaves those programs virtually intact despite the threat of further international sanctions. So much for regaining our moral stature in the world.

Bush threatens to veto the Farm Bill, with which we will live for five years, saying the Senate version would impair negotiations with the WTO. Cotton acreage has actually dropped nationwide, 20 percent in California (7th in domestic production). In the Central Valley, irrigation limits to protect threatened fish could cut supplies by two-thirds next year. Producers now ship 70 percent, in raw bales, to foreign markets, mostly to textile mills in Asia.

And then there’s the whole corn thing. Midwestern farmers are being subsidized to grow corn in the name of renewable energy production. Never mind that this country has been producing surplus corn for decades. We flood poor foreign countries with the stuff in the name of aid, putting local farmers out of business. We artificially inflate corn prices as a commodity to be traded, rather than as food for starving people. We feed it to cattle, even though cattle have evolved to thrive on grass and haven’t the necessary enzymes to digest corn. Hence the incredible amounts of methane produced on feedlots.

Even as prices once fell to levels below growing costs, farmers were encouraged to plant more acres of corn.

If we were more concerned about national health, those subsidies, or incentives, would go to growers of fresh vegetables and fruit, preferably organic, which would cut prices and overuse of chemical fertilizers, pesticides and herbicides. Could we override the Dow lobby? The obesity epidemic is fueled in part by comparatively high prices of nutritional foods and creative uses of surplus corn in processed food. Look at some food labels. High fructose corn syrup is the primary ingredient in everything even remotely sweet. And why is that? Duh! It’s cheaper than sugar because it’s heavily subsidized.

And instead of subsidizing corn grown for ethanol, not an efficient way to produce alternative fuel, we could give grants to develop processes for cellulosic ethanol using wheat straw, agricultural waste products and wild grasses. Even livestock producers would profit by reduced demand for feed corn. We could fund pilot plants that use native feedstocks to produce fuel and technical assistance to promote conservation by helping farmers reduce energy consumption and control air and water pollution.

In a recent Los Angeles Times column, Joel Stein, at his acerbic best, said: “When CARE, the giant poverty-relief organization, stops taking $45 million a year in indirect food aid from the U.S. government, it is a strong indicator of some impressive sleaziness going down in D.C.”

Indirect is the operative word here. The $45 million CARE gets isn’t sent to poor people in the form of something useful, like cash, Stein says. “It funds a complicated scheme that only a huge bureaucracy or a really dumb money launderer would concoct.”

Taxpayer money is used to buy food, i.e., surplus corn, from U.S. agribusiness, and is sent via U.S. shipping companies to impoverished nations. But it’s not given to starving people. It’s sold on the open local market for the highest price possible. The resulting revenue, about 75 percent of the original aid money, is used to fund programs for the poor and hungry.

How much sense does it make, Stein posits, to ship corn from Nebraska, which takes about five months, and sell it in Micronesia to help people whose village has been swept away by a tsunami?

President Bush, bless his heart, actually proposed that 25 percent or more of food aid be bought locally. Will Congress quell its partisan posturing and include that in the Farm Bill? Europe, Canada and the U.N. have already stopped monetizing food aid, while the U.S. has amped its program.

Guess that puts us on the wrong end of yet another trend.