Thursday, April 12, 2012

Farm Subsidies on line as Canada pursues seat at TPP

By Jennifer Ditchburn, Canadian Press, Globe and Mail, April 12, 2012
So attractive is the Trans-Pacific Partnership, a nine-country tariff-free bridge between this hemisphere and Asia, Mr. Fast (Canada's Minister of International Trade) spent time in Peru Thursday drumming up support for Canada's involvement in the talks. Peru is already part of the exclusive TPP negotiating club.

The United States has been the main obstacle in Canada's way, taking issue with a supply management system that protects certain Canadian farmers from international competition.
As Canada pushes for a seat at the TPP table, the government is also in exploratory talks with South America's powerful Mercosur customs union that includes Brazil and Argentina. Because of the union, the participating countries cannot enter into separate trade deals with outside nations....
Canada is willing to discuss everything – including its controversial supply management system – when it sits down with other countries to negotiate a tantalizing trans-Pacific free trade zone, the Trade Minister says.

Ed Fast underlined that the Conservatives have promised egg, dairy and poultry farmers that they will protect their interests.
So, let me try to understand the position of the Canadian government....
  • She is desperate for a seat at the table of the Trans-Pacific Partnership, where the U.S. is currently blocking our entry because we employ supply-side management supports for egg, dairy and poultry farmers
  • Through the Minister of International Trade, she has promised those same farmers NOT to abandon support for them
So, are we going to ditch the decades-old support system for the farmers, as we did to the wheat farmers by dismembering the Canadian Wheat Board?
Or are we going to abandon our pursuit of that TPP seat-at-the-table in favour of the farmers?
After our pitiful demonstration of abject desperation in our lobbying pursuit of the seat on the UN Security Council, Canadians have to wonder if, on the world stage, our leaders are not manakins dancing to at least two different musical scores, one at home and another while out of the country.
That is a dance extremely difficult, if not impossible, to execute and certainly without grace or elegance at the very least.
Canadians have come to regard the pursuit of elegance and grace as beyond the capacity of this government. What is perhaps still in question is whether or not their "two-step" on most issues is calculated as cunning and strategic or merely stupid and dishonest. I prefer the latter view.
As for the question of farm subsidies, here is a primer from John Ibbitson.
By John Ibbitson, Globe and Mail, March 7, 2012
We should know the future of supply management by September, when the United States is expected to decide whether it supports this country’s accession to the talks. If Canada is invited to the table, then that means supply management will be on the table.

Many farmers and other supporters argue passionately for continued protection for poultry and dairy, while many economists and business groups strongly condemn it.
So what are those arguments, pro and con? Herewith, a brief primer on the two sides of the dispute.
In Praise of Protection
For four decades the federal and provincial governments have regulated the supply of dairy and poultry products, through a system of quotas, marketing boards and tariffs. The system provides consumers with a safe and affordable supply of milk, butter, cheese, eggs and poultry, while assuring farmers of predictable income.
Dismantling supply management, its defenders maintain, would extinguish thousands of family farms and subject Canadians to foreign products that might not meet Canadian domestic-production standards. And the loss of this country’s ability to produce its own dairy and poultry products could come back to haunt us if a natural disaster or economic crisis disrupted global supply chains.
“Supply management works well for farmers, processors and Canada as a whole,” said Ron Versteeg, vice-president of Dairy Farmers of Canada. When critics argue that Canada is the only country that practises supply management, he said, it is because “we stand alone in providing clean, consistent and transparent access to our market, while other countries hide behind phony non-tariff barriers.”
In Praise of Free Trade
There are about 19,000 dairy and poultry farmers in Canada, and their number is steadily dropping. To sacrifice trade agreements that could create many thousands of new jobs that would equip Canada to meet the challenges of the growing Pacific markets, just to protect some family farms, would be folly, trade advocates say.
Beyond that, supply management costs consumers through higher prices for dairy and poultry products, compared to south of the border. If protections were dismantled, larger and more efficient farms would readily compete against cheaper imports, free-trade advocates predict.
“Why should we be paying more for our chicken, eggs and dairy products? It’s totally outrageous,” maintains Herbert Grubel, a senior fellow at the Fraser Institute, a conservative think tank.
“And the added cost of not being able to pursue free trade really pushes things over the edge.”
At the root of the ongoing support for supply management might be the tie that still binds many Canadians to the farms their ancestors came from. Protecting the family farm resonates even among the most urbanized Canadians, who mourn the ongoing erosion of Canada’s rural heritage.
Whether the next generation and newer immigrants feel the same attachment could determine the long-term outlook for one of the last bastions of the settler culture.
Let's not be naive. Mr. Ibbitson references the Fraser Institute, one of the most right-wing, neo-con 'think tanks', if not the most right-wing in the country. It cannot be considered representative of anything except unfettered economies, at all levels, with no government regulations, restrictions, cautions, or oversight.
For our part, we see a pattern of erosion of all government programs...those that support individuals needing a hand-up (not a hand-out), social agencies that support the work of the supervision of children and families, the health care of infants especially in homes where parents are ill-equipped, the support of transformation (and not merely incarceration) of those who have broken the law, the support of the public health care system....and so to cast the farm subsidy in the frame of "the attachment to the land" and to a settler mentality, is a reductionism with which we cannot concur.
"Progress" and modernity do not have to include the stripping away of all forms of leaven and support, not only for farmers, but as a general principle. In fact, there are aspects of government support, care, compassion and moderating influence amid strong shifts in weather and climate, for example, but also in economic cycles that require moderation, and we do not have to strip away all those supports, as our way of purchasing entry into a darwinian global marketplace.

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