Western Producer staff
Naturally enough, post-budget reaction concentrated on the financial and service cutbacks imposed by the government. But the farm policy revolution launched by the Liberals with this budget goes far deeper than the immediate and obvious financial paring.
It also heralds a backing away from governance, a Liberal retreat from the idea of government intervention in the agricultural economy – a retreat that will redefine the historic co-operation between the public sector and the food industry.
In the process, the Liberals are encouraging the industry to demand less government in its life, hoping to enlist farmers and other ‘stakeholders’ in a crusade to make government smaller and the state less powerful.
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Parts of the Agriculture Canada research effort are being “privatized” with the government decision to cut the public research funding and to expand only in those areas in which industry puts up some money and gains most of the say.
In the inspection and grading area, increased government fees are being imposed alongside a promise (a plea, almost) that if industry would like to take over some of these traditional government functions rather than pay more for them, Ottawa is happy to talk.
However, the real frontier for a retreat from agricultural governance is in the area of regulation. It is here where the government seems to be hoping for a farmer uprising to demand reduced regulation and government involvement.
The early post-budget response from farm leaders followed the script.
In Halifax, Canadian Federation of Agriculture president Jack Wilkinson put Goodale on notice that if Ottawa expects farmers to make do with less support, it must move quickly to get rid of regulations that hamper farmers’ ability to make money. As Goodale left the room, he was lobbied by John Pearson from Prairie Pools to change labor laws and regulations that affect the farm bottom line.
Later, an Agriculture Canada official happily interpreted what he had heard.
“Interesting,” he said. “I heard them saying if you are not going to help us, government, then get out of our way. Let the markets work.”
This sounds like a prescription, or maybe a wish, for radical deregulation.
No doubt there will be farmer demands that inspection costs be cut by reducing inspections. There will be renewed demands that Canadian Wheat Board regulations be amended so farmers can sell where they get the best price, even if it is abroad.
Farmers will be looking for relief from regulations they believe cost them money.
The challenge for the farm community will be to keep the deregulation mania in perspective. Before demands for deregulation become a haphazard torrent that plays into the government strategy of retreat from governance, the farm community collectively should decide what it needs from the government – the appropriate balance between less interference and necessary intervention.
For an industry subject to cyclical markets and dependent on public credibility, too little government could prove to be as big a problem some day as too much.
