A new vision for agriculture
momagri, movement for a world agricultural organization, is a think tank chaired by Christian Pèes.
It brings together, managers from the agricultural world and important people from external perspectives,
such as health, development, strategy and defense. Its objective is to promote regulation
of agricultural markets by creating new evaluation tools, such as economic models and indicators,
and by drawing up proposals for an agricultural and international food policy.
A look at the news

The CAP and the Farm Bill, two agricultural policies under threat?

February 18, 2013

On either side of the Atlantic, both the Farm Bill and the CAP are under considerable pressure, mainly budgetary pressure… ‘Agriculture no longer seems to be a priority.’ said Senator Debbie Stabenow in January 2013, when the extension of the 2008 Farm Bill was voted through to 30 September 2013.

In a recent publication1, Jim Harkness, the President of IATP2, posed the question of whether ‘this might be the end of the farm bill?’ This question calls for another: Could it also be the end of the CAP?

At the end of December 2012, Republicans and Democrats avoided the ‘fiscal cliff’ by reaching an agreement on tax cuts for social welfare and tax increases for the wealthy, and by putting off for two months the question of the debt ceiling and budget cuts. This agreement basically postponed the hard decision to prevent the US economy falling over the edge of what is now referred to as the ‘Wall of Debt’.

As far as the Farm Bill is concerned, this is like trying to put off the inevitable, simply because the budget will eventually be slashed by $ 35 billion as soon as the extended Bill expires. The Senate and the House of Representatives nevertheless reached a consensus that de-coupled payments (DP for Direct Payments) should be given up in favour of coupled payments with guaranteed countercyclical funding, and higher crop insurance payments (which certain experts claim could reach approx. 9 billion USD/year). In the end, as Jim Harkness explains ‘The skeletal structure [of the Farm Bill] stays in place as it’s bled by [a thousand] budget cuts’, and therefore will no longer help build a new policy framework. Meanwhile in Europe, budget cuts were announced by the EU during the Multiannual Financial Framework Summit on the 7 and 8 February. A situation that tends to show that for the two food-producing giants agricultural policy is no longer a priority. In the current context of austerity, the CAP budget for 2014-2020, is to be cut by 12%.

Economic and financial considerations which prevailed in the 90s are no longer a issue. The context is radically changed for agricultural markets as globalization takes over. In the last few years, financial players have taken over these markets and prices have become more volatile. Faced with this systemic instability, the EU and the United States have been weakened by measures that are no longer adapted or ineffective in terms of ensuring a future for farmers, and this in spite of the efficient tools implemented by the Farm Bill to protect farming income.

As Jim Harkness sadly points out ‘The Farm Bill as it is today overlooks the truly important and urgent challenges for agriculture: uncontrolled market price volatility which threatens the financial stability of farmers and climatic hazards such as droughts and floods’. A statement which could just as well apply to the CAP. With a difference: despite the provisions in the Farm Bill that have occurred over the past 20 years, the United States has taken emergency provisions allowing their farmers to maintain an income sufficient to preserve the production tool.

This is not the end of a story, as Francis Fukuyama once put it, but merely the end of a cycle. European and US agriculture must think up a new model based on global cooperation and regulated markets, in order to adapt to new realities. It is urgent to build a new governance ‘for an ethical, environmentally sustainable and healthy global food system’ says Jim Harkness, but above all a global governance that will inject some dynamism in both US and European agricultural policies, as well as those of other countries in order to guarantee food security for over 9 billion humans.

1 Please click on this link if you wish to view the complete version of this publication http://www.iatp.org/documents/the-end-of-the-farm-bill
2 Institute for Agriculture and Trade Policy
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Paris, 19 June 2019