European Farm Reforms Conservation-Oriented

Commentary, Agriculture, Robert Sopuck

A wise man once said, “If you don’t know where you are going, any road will take you there.” The corollary to that one is, “When you come to a fork in the road, take it!” These adages sum up government’s chaotic approach to agricultural enhancement and rural development. We’ve got ad hoc supports, supply management, production subsidies, over-regulation, too many task forces and consultations, and a general mishmash of goals.

Rural communities are confounded by this confusion. We know something needs to be done, but what? The U.S. and Europe have proven that direct programs to support farm production have the perverse effect of making rural communities and farms decline faster. Production supports favour big farmers because they become “capitalized” into land values. Land values spike beyond any reasonable relationship to farm profitability. Larger farms quickly gobble up little farms while young farmers, the lifeblood of our future, are denied entry to the business.

Given all this, it is heartening to hear that governments around the world are finally starting to look at the wisdom of current farm supports.

Franz Fischler, the European Union’s agricultural commissioner, recently unveiled proposals for reforming the E.U.’s costly and protectionist agricultural policies. The essence of his proposal is to cut the links between farm subsidies and farm production. Direct price supports like in the U.S. and the E.U. cause overproduction and subsidized dumping of farm products onto world markets. Prices fall and Canadian farmers are caught in the crossfire.

The new supports in the E.U. would focus on environmental protection, a “public good” that benefits the community as a whole. In that context, providing incentives for farmers to deliver “environmental services” to the rest of society instead of more crops makes sense. The European public at large has been demanding these services and should support this program change. The EU’s production subsidies would be cut by 20% in stages, and any program savings would be redirected to rural development.

This last part sounds suspiciously like government supports for business development, which have a dismal track record. Still, at least some creative ideas are being brought forward.

On the conservation side. the United States has made significant contributions to environmental health through their massive Conservation Reserve Program. Both the EU’s and the U.S. farm conservation programs will go a long way to addressing serious ecological issues in farm country, like water quality.

Ralph Goodale, the “Minister for Saskatchewan,” recently announced a similar type of program. While the details are still to be worked out, Goodale announced that a portion of the recently announced federal farm aid package, about $190 million, would go into planting trees and shelter-belts, and seeding so-called “marginal land” to permanent cover. Drought relief is also part of the package. Finally, federal farm policy takes a small turn in the right direction.

We have to make sure that any new program improves rural communities and addresses key environmental priorities, without distorting trade.. While the “devil is in the details”, at least we have something to work with.

It’s a good start.