Farmers Neglected at Home and Abroad / Critics trade blame over subsidies, WTO

By Michael Standaert

Iowa farmer Chris Petersen knows firsthand what it means to lose his lot.

Back in 2001 his full-time, 400-acre hog farm in Clear Lake, Iowa, went bankrupt. He now works 50 acres part-time, raising specialty Berkshire pigs, garden produce and eggs for local consumption.

“I can tell stories of bankruptcies and suicides that will make your hair stand on end,” he said.

Petersen, vice president of the Iowa Farmers Union since 2000, is one of many small and regional farmers in America and abroad struggling with complex issues of agricultural subsidies, global trade and environmental sustainability.

Those issues drove a wedge into Cancun’s World Trade Organization meeting this past September, derailing attempts by the United States, Europe and other industrialized nations to eliminate agricultural subsidies worldwide in the name of free trade.

At stake is food for the world’s billions, a solution to developing-world poverty, the preservation of farming communities — and the ecological health of the soil and water that supports crops in the first place.

“A lot of [Cancun’s failure] had to do with different views on ending agricultural subsidies, and what the nature of agricultural subsidies should be,” said Kathy Lawrence of the National Campaign for Sustainable Agriculture.

According to Lawrence, the collapse of the WTO meeting resulted in part from anger over America’s campaign to end subsidized farming abroad, but its continued addiction to large domestic agricultural subsidies.

“Of course the U.S. is seen as talking out of both sides of the mouth,” she said.

For free-market proponents, eliminating subsidies is seen as a way to feed the hungry and alleviate poverty worldwide — indeed, the World Bank estimates that free trade could increase income in developing countries by $350 billion, and conceivably lift 144 million people out of poverty by 2015.

“Folks in the U.S. claim most loudly to be the friends of the poor and downtrodden,” said University of Iowa economics professor William Albrecht, “[but] won’t do the one thing that would help the poor and downtrodden most, which I think is free trade.”

Albrecht said that smaller farmers are less likely to succeed in a free-trade system, but maintains that the overall benefits will be better for the economy in general.

“I think that freer trade probably means that small, inefficient operators will be less likely to survive,” he said. “[F]or some towns that’s been very unfortunate. On the other hand, I don’t know why the goal of public policy should be to support inefficient farms.”

The solution for communities, he said, is a better social safety net for individuals, rather than propping up uncompetitive businesses.

The theory is compelling, but Lawrence says in practice it doesn’t work.

“Free markets can do a very good job of wealth creation,” she said. “[But they] do an abysmal job of distributing wealth.”

NAFTA in question

On October 14, frustration with current free-trade systems brought about 200 farmers from the U.S. and Mexico to a Des Moines rally organized by the National Catholic Rural Life Conference, the Iowa Farmers Union, the National Family Farm Coalition and other groups.

Speakers were critical of the North American Free Trade Agreement, and Mexican farmers said U.S. corn subsidies have made it impossible for them to compete in the treaty’s free-trade zone.

According to a November 2003 report by the Carnegie Endowment for International Peace, 1.3 million agricultural jobs have been lost in Mexico since NAFTA went into effect in 1994, and deforestation from farming remains a problem.

In the United States, a 1998 U.S. Department of Agriculture report found that more than 300,000 small family farms went out of business between 1979 and 1998, and that from 1910 to 1990 the share of the agricultural dollars received by farmers dropped from 21 to 5 percent.

Meanwhile, subsidy payouts remain in the stratosphere — and much of the money never makes it to the small farmer who needs the most help.

A study last year by the Washington, D.C.-based Environmental Working Group estimates that the federal government spent $114 billion on farm subsidies between 1995 and 2002.

According to the report, over the next ten years the top 10 percent of the biggest farms nationwide, mostly corporate agribusiness, will collect about two-thirds of all crop subsidies — while a backlog of $2.5 billion in applications for medium- and small-farm conservation programs keeps growing.

These subsidies are agriculture’s worst scourge, Albrecht said, because “they jack up land prices. Because it is always tied to production, most of the aid goes to farmers with more land,” which inflates land prices and encourages larger farmers to buy out small operations.

The result, he says, is overproduction and environmentally unsound practices, as farmers use more chemical fertilizers and pesticides in the hopes of increasing yield and making ends meet.

Sustainable agriculture

Environmental activists, discouraged by the failure of the WTO to establish enforceable sustainable development regulations, dispute the value of free trade, and call for a more fundamental rethinking of the issues.

“We need a culture of agriculture that recognizes the multiple benefits of farming — ecological, environmental, social, and cultural — rather than just the economic production of food and feed stuffs,” said Robert Gronski, policy coordinator for the National Catholic Rural Life Conference in Des Moines, Iowa.

The Wild Farm Alliance, a California-based environmental organization, promotes a complex and regionalized agriculture that integrates food production into local ecosystems, sustains soil fertility over time without fertilizers, and encourages small farmers to better understand microclimates and the specific characteristics of their soils, fields and crop varieties.

They’re just one facet of a bourgeoning environmentalist farming movement. Along with groups like the Permaculture Institute, they seek to rewrite the agricultural formula from the ground up.

According to Lawrence, chemically supplemented farming can be hard to resist, because over the short term it can result in a “very dramatic boost in yield the problem is farmers need more [chemicals] over time.”

This chemical dependency, she said, destroys soil health by killing productive micro-organisms, and creates pollution from the fertilizers and pesticides needed to sustain huge fields of biologically uniform crops.

“[S]ustainable agricultural production can match conventional industrial agriculture yields,” she said. “[S]traight from a chemical farm you need two or three years to rebuild the soil … after that yield improves.”

The Green Revolution

Cresco, Iowa, native Norman Borlaug saw feast in the Midwest in the early part of his life, and famine in India, Pakistan and much of the developing world during the last five decades.

Borlaug won the Nobel Peace Prize in 1970 for his pioneering work in developing high-yield “Green Revolution” crops, and has worked in developing nations to increase food production.

At age 90, Borlaug is a believer in large-scale industrial and technological cures for agricultural woes — including genetic engineering and petrochemical fertilizers — but said that without basic needs such as education and transportation, reducing subsidies to help developing-world farmers will not work.

In general, globalization is all right,” Borlaug said in a telephone interview from Texas A&M University, where he teaches part time. “But these people dont have anything to begin with. They are poor. They need roads and schools, then public health will follow. It doesnt happen overnight.

They may differ on the environmental issues, but Lawrence and Borlaug agree that the problem is deeply rooted in the system.

“Poverty is driven by much more than agriculture and food and hunger is actually more a symptom of poverty than of a lack of food,” said Lawrence. “We currently produce enough food to feed every man, woman and child on earth three or 4,000 calories a day enough to make you fat.”

“The government is part of the problem in not enforcing anti-trust laws and not promoting family farmers,” said the Iowa Farmers Union’s Petersen. “Theyre trying to tell us we should be happy to mortgage our family farm and raise hogs for a corporation.

Phone calls about subsidies and free trade to Archer Daniels Midland and Cargill, two leading agribusiness conglomerates, were not returned.

Additional reporting by Josh Wilson