IT SEEMS so bizarre, so cynical, to find fault with a billion dollar farm aid announcement but it must be done.
This was an announcement that unnecessarily aggravated federal-provincial relations, raised non-farm public assumptions that Ottawa is DOING SOMETHING MEANINGFUL FOR FARMERS and cashed in a lot of political IOUs for agriculture minister Andy Mitchell that may well have been useful down the road when the next crisis arises.
Sadly, that billion dollars will sink like a stone below the surface of the farm economy, so great is the need and so deep the market dysfunction.
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The average farmer will receive his few thousands of dollars, pay some bills and be right back in the soup of producing a low-value product that fuels a profitable $130 billion food industry but does not return a living wage to the primary producer.
Because it is based on historic eligible net sales, the irony is that those farmers who have done well in the past will receive the most help and those who have watched incremental rather than dramatic income declines for years will receive the least.
Don’t blame Mitchell for the inadequacy of the payment. He was responding to demands from farm leaders for a cash injection.
And don’t blame the current regime for the inadequate design of the safety net. It was inherited from a previous Liberal regime and a previous deputy minister.
Still, barring the greatest drought in the history of Brazil, the United States and western Europe combined that would spike commodity prices, Mitchell will face autumn calls for more aid.
If the wobbly Liberals survive the summer and the reality of scandal and underwhelming performance, he could well be back at the finance minister’s door in fall as an election looms.
But there were some missteps in Mitchell’s handling of the aid program announcement. He unnecessarily ruffled provincial feathers by designing and announcing a program without consultation and then putting the provinces on the spot by insisting they should produce their 40 percent Ñ $665 million.
The provinces surely are correct to argue that if this is a federal-provincial deal, they should have been involved in the planning and timing.
They are correct to note that while Ottawa found its billion dollars among loose change in Ottawa’s large 2004-05 surplus, the provinces continue to run deficits because of federal cost downloading and cannot easily find new money.
And there was no need for Ottawa to be so unilateral at a time when Mitchell has been winning brownie points by accepting provincial arguments that many provinces are unable to keep up with federal agricultural spending because of fiscal restraints.
Mitchell has hosted two federal-provincial discussions on “affordability” and the next one is scheduled for July in Alberta. The March 29 announcement will not make those discussions any easier.
Mitchell has said he is open to changes in the Canadian Agricultural Income Support program. He has assigned his parliamentary secretary to look for permanent solutions to low farm incomes. He has promised provinces he is sensitive to their fiscal plight.
The billion-dollar announcement may have been politically and economically necessary. But it did complicate things.
