Dominic Lawson: Don't blame free trade for food price rises

Sunday 23 October 2011 00:16

Sometimes an entire philosophy can be glimpsed in a single remark. So I am grateful to Andrew Dorward of London's School of Oriental and African Studies for his explanation of why it would not be in the interests of Africans to adopt genetically modified herbicide-resistant crops. Dr Dorward told the Financial Times that this would be "disastrous for many poor households" because such crops would "allow the replacement of hand-weeding, which is a big source of income for many".

This is the sort of argument which would have dismissed the invention of the printing press as endangering the livelihood of monks and quill manufacturers. The monks, at least, were not engaged in back-breaking labour-- unlike the sub-Saharan subsistence farmer, who under the blazing sun might spend up to 120 days weeding a single field, instead of utilising the time saved in cultivating new crops or tilling new fields. Yet this is the sort of grinding, life-shortening labour in which the advocates of so-called "sustainable development" wish to keep Africans enslaved – the sort of life which no Westerner would tolerate for himself or his family.

It is characteristic of the double standards which the international aid establishment has been promulgating for years – and which has been evident during the Rome food summit over the past few days. Thus John Hilary, of War on Want, claimed both that it was the "liberalisation" of agricultural markets which lay behind the international food crisis, and also that the Western world should end its protectionist farming policies.

He's right that we should do so – yet for some reason he will not utter a word of criticism against the much-higher agricultural tariffs that exist between the countries of sub-Saharan Africa, and which have an obvious and immediate role in making food more expensive for some of the poorest people on earth. Import controls in the developing world are a dramatic contributor to "food poverty" – so why is "market liberalisation" such a terrible idea?

Such impoverishing beggar-my-neighbour policies are defended by the likes of War on Want on the grounds that such actions by governments in the developing world are a proper exercise of "food sovereignty". In practice this actually means nothing more than the right of landowners – who tend to be government ministers – to extort monopoly rents at the expense of those less fortunate.

If I were a cynical man, I would wonder whether the international aid agencies had a vested interest in maintaining such a failed political and economic system, since it keeps entire populations in the state of dependence which justifies their own existence, and their regular appeals to our charitable conscience.

Nevertheless, it isAmerica which has once again been subject to the biggest criticism at an international summit – this time for its policy of vast ethanol subsidies, with its effect of turning about a quarter of what was its corn production into fuel for cars. Well, it is indeed absolutely indefensible – but if anyone thinks a President Barack Obama would change this policy, they would be very much mistaken. The Democrat candidate voiced his support for this grotesque subsidy on the campaign trail.

Although the ethanol racket was invented by George Bush when he realised that the Iraq war had failed in its second-order objective of increasing the supply of "friendly" oil from the Middle East, the 43rd US President is actually less keen on agricultural subsidies than the supposedly more enlightened Democrats.

Three weeks ago the Democrat-controlled Senate voted to extend and expand various US farm subsidies with a bill which it is estimated will cost American taxpayers $290bn (£150bn). George Bush urged legislators to reject the bill and said he would veto it, if he could. Bush insisted that it would not just be an unconscionable hand-out to some of the country's biggest and richest landowners – at the expense of all taxpayers – but would also damage America's trade relationships.

You might argue that as an outgoing president with no need or opportunity to win a general election, George Bush could now afford to take a more high-minded approach. So note this: John McCain also declared that he would veto such a bill, were he to be elected president. And Barack Obama? He supported the bill. The head of Oxfam America, Ray Offenheiser, argued furiously that the $290bn subsidy bill would "hurt the world's poorest farmers". Perhaps Mr Offenheiser should ask Barack Obama to spare a thought – even in this election year – for his paternal relatives in Kenya.

Not, of course, that we in the European Union have the slightest reason to feel morally superior. The Common Agricultural Policy remains the most organised conspiracy to maintain global food prices at an artificially high level.

Douglas Alexander, the British Government's Secretary for International Development, was quite right to tell the Rome food summit: "It is unacceptable that the rich countries still subsidise farming by $1bn a day, costing poor farmers in developing countries an estimated $100bn a year in lost income." It would have been even better if he had mentioned the Common Agricultural Policy, specifically, in that statement.

More to the point, I wonder why Gordon Brown – who recently sought to blame the Organisation of Petroleum Exporting Countries (Opec) for the high cost of petrol and diesel in our filling stations – has not attacked the much more single-minded cartel known as the Common Agricultural Policy for its contribution to the cost of food in Britain's high streets. Oh, I remember why, now: our country is a member of that infamous cartel.

This is in part why I query the remarks by the Foreign Office minister, Lord Malloch-Brown, after Robert Mugabe had dropped in to make a speech to the gathering. Malloch-Brown declared that "Zimbabwe is one of the few countries whose food crisis is not due to climate change or global prices, but due to disastrous policies".

It's true that Zimbabwe is an extreme case, in which corrupt government policies of land requisition have turned the former African "bread-basket" into a basket-case. Yet across the world, almost every distortion of food production, every misallocation of resources, can be attributed to the interventions of governments, whether as extorters of tax on food, or as lackeys of landowners – or a bizarre combination of both.

In other words, it's not the unfettered free market and globalisation which has caused the world food crisis, but governments who insist that markets can not be trusted – unlike them, of course. What is truly terrifying is that they continue, decade after decade, to get away with it.

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