Agricultural subsidies are a major factor in determining what people eat. What does this mean and how does it affect you?
Agricultural subsidies are what the government pays farmers -sometimes to grow crops and sometimes not to grow crops- in order to manage food supply and control prices. The US government has used agricultural subsidies for about 80 years and since 1995 has paid out $194 billion in crop subsidies to farmers (farm.ewg.org).
As an example, corn is America’s largest crop and the crop receiving the highest subsidies. Corn is animal feed and it’s turned into ethanol. It’s breakfast cereal, vegetable oil, high-fructose corn syrup (which, let’s face it, is in everything from soup to juice to ketchup to bread). Generally the reason we buy food that’s unhealthy is because it’s cheap and abundant. A really accessible and surprising read on this issue is U.S.PIRG’s Apples-to-Twinkies report. There are interesting statistics in the Key Findings. My favorite is:
“If subsidies for junk food ingredients went directly to taxpayers to allow them to purchase food, each of America’s 141 million taxpayers would receive $7.58 to spend on junk food and 27 cents to spend on apples each year – enough to buy 21 Twinkies but just half of one Red Delicious apple.”
INFLUENCING WHAT WE EAT
People get up in arms about regulations like Bloomberg’s ‘Big Gulp’, but part of the reason that these regulations are necessary is because our government first enabled companies to make soda on the cheap in the first place through subsidies. We were, and continue to be, influenced to consume unhealthy products. Emerging regulations like the Big Gulp are peoples/politicians attempts to realign our awareness. As a side note, I think people who are battling for the right to buy larger sodas need to rethink their priorities.
For a country built on capitalism and fair markets the government does an awful lot to promote unfair advantages and show preference. The unfair advantages that subsidies create are both domestic and global and oppress people worldwide. Proponents would argue that subsidies make food prices lower and therefore allow more people to eat and also keep farmers in business through supplemental income. This same view would promote GMO’s and intensive agriculture and monocrops instead of making the hard decisions like investing in sustainable agriculture, decreasing food waste, and improving food distribution efficiency.
Opponents of subsidies like myself believe that subsidies block small farmers from the market and rob them of their livelihood since non-subsidized farms just can’t compete pricewise. This fact is true worldwide, though as you know from previous posts and hopefully your own local economy that those who have the means to support small farms and fair trade (that’s not to say Fair Trade, necessarily) are increasingly using their buying power to do so and voting three times a day. However, that fight is far from won. Small farmers are still struggling for their place in the market. In the Global South, farmers are less and less able to afford to produce or eat their food. Agricultural subsidies in developed countries are a massive threat to well-being and economic development in these struggling economies.
I simply don’t understand subsidies economically or morally. I might be missing a piece of the puzzle but even in more elaborate economic terms I don’t think that’s likely. Just ask Joseph Stiglitz, former vp and chief economist at the World Bank.