The Chicago Council on Global Affairs' Agriculture Task Force released a report today outlining a roadmap for the 2007 Farm Bill, with special emphasis on eliminating trade-distorting agricultural subsidies within five years. The council suggested a series of new programs to provide a continued safety net for farmers while minimizing the affect on farm commodity prices.
U.S. and European Union disagreements over farm subsidies have stalled the Doha round trade talks. "When talks resume, the US has a golden opportunity to break the Doha logjam by offering to end our trade-distorting subsidies within five years instead of the 15 already proposed," says Robert Thompson, co-chair of the task force and former USDA assistant secretary.
If the U.S. doesn't start moving in the direction of replacing the subsidies, the WTO will do it first, said task force co-chair and former USDA under-secretary Gus Schumacher, who once managed the subsidy programs. "We'll lose control of key farm policy tools and miss the export expansion opportunities in emerging markets that a successful Doha round could bring." Schumacher also asked that countries representing expanding markets and those representing competitors need to improve their market access.
The report suggested programs the U.S. could transition into from the current subsidy system, maintaining a farm safety net. New programs would include revenue insurance covering all commodities, allowing farmers to purchase insurance against losses at lower, subsidized rates; land stewardship rewards that reward producers depending on the environmental goods and services they provide; and farmer savings accounts similar to 401(k)s, in which the government makes matching contributions.
The task force also called for at least 20% of current trade-distorting support funds to be spent instead on rural infrastructure, agricultural research, and other projects toward the good of the rural public.
The program also includes a dramatic revamping of the food-stamp program, replacing unhealthy foods with nutritious ones such as fruits and vegetables.