What is at the heart of Canadian agricultural troubles today?
Ask any politician or virtually any farm group, and they’ll speak the
‘S’ word: subsidies that other countries offer their farmers.
These subsidies obliterate the true value of product, distort prices
and prevent farmers in non-subsidizing countries from competing on the
ubiquitous “level playing field.”
This message has been played for some years and is accepted as fact. To
keep the issue in the forefront, politicians and farm groups are
Read Also
Agriculture needs to prepare for government spending cuts
As government makes necessary cuts to spending, what can be reduced or restructured in the budgets for agriculture?
becoming more creative in their explanations about subsidies.
On Nov. 12, federal agriculture minister Lyle Vanclief quoted World
Bank chief economist Nicholas Stern as he explained the scourge of
subsidies: “Mr. Stern has estimated that the average cow in Europe
receives about $2.50 US a day ($3.88 Cdn) in subsidies and that the
average cow in Japan receives nearly $7 a day ($10.85 Cdn).”
Vanclief was making the point that Canada does not intend to join this
subsidy race, seeing it as a losing game. Rather, Canada is hitching
its wagon to World Trade Organization talks that may include “the
reduction, with a view to phasing out, all forms of export subsidies,
and substantial reductions in trade-distorting domestic support.”
The Catholic Aid Agency in Europe also uses cows in its subsidy
analogy. It says the European Union spends enough money on farmers each
year – $37 billion US – to pay for a round-the-world trip for all 21
million cows in Europe.
The agency further calculates that each cow would have $585 in spending
money to use on the trip, because souvenirs, hay bales and such are not
cheap in some regions – like drought-stricken Western Canada, for
instance.
The agency concludes that the average European cow thus has a higher
income than half the world’s population. Stern made a similar
comparison, as quoted by Vanclief: “In contrast, 75 percent of the
people in sub-Saharan Africa live on less that $2 a day.”
Foregoing bovine comparisons for the moment, the Organization for
Economic Co-operation and Development estimates that 2001 wheat
production subsidies, per tonne in Canadian dollars, lined up this
way: EU $130; U.S. $108; Canada $31; Australia $7.
It’s funny to imagine jet-setting cows living luxurious lives by virtue
of subsidies in other countries. It’s not so funny when we realize
Canadian farmers are big losers in the subsidy game.
