TCS Daily

In Farm's Way

By Helen Szamuely - February 25, 2004 12:00 AM

With the EU Constitution on ice the Irish Presidency will have to pay some attention to the latest attempt to reform that cornerstone of the European Union: the Common Agricultural Policy.

The need for a reform has been obvious for years, especially as the EU enlarges to the east. The system of quotas, subsidies, regimes, already somewhat creaky, was clearly going to be unaffordable once the much poorer and more agricultural former Communist countries joined the bloc. Further pressure came from the US (itself not averse to protecting and subsidizing its farming sector); Third World countries, which, justifiably, felt hard done by as they were prevented from selling their agricultural produce to the EU and were the reluctant recipients of heavily subsidized and, therefore, cheaper European goods; and public opinion within the West European countries themselves.

There have been various attempts in the past to reform the CAP but these all ended up with more money being spent in some form of subsidy and no real change in the situation. The latest proposal pretends to a double aim: to move money away from subsidizing production to environmental benefits and to begin the process of integrating European agriculture into the market economy. In order to achieve these supposed advantages a complicated system of decoupling subsidies from production (or, in the case of some member states, decoupling them partially) and of working out a single farm payment, is being created.

The UK government has not yet made it clear how these payments will be decided: on a historical ownership basis or in some other way. The situation is complicated by the fact that the devolved government of Scotland may well decide differently from Westminster. It has already been calculated that at least 18 separate and detailed regulations will have to be fulfilled by farmers who want to claim a single farm payment. And, as one minister has pointed out to incredulous representatives of farming and allied organizations, as far as the public is concerned this supposedly revolutionary change is meaningless: they will see the same farmers getting the same money under different heading and, possibly, for not growing anything at all.

Agriculture and rural policy in general are the last bastions of old-fashioned ideological socialism. This would have surprised Marx and Lenin, who had perceived the countryside as irredeemably petit-bourgeois, individualistic and wedded to the idea of private land ownership. But over half a century of subsidization and political control of production has changed all that. The new form of socialist-type state control does not need actual ownership of land. It can be exercised through a system of hand-outs and regulations. So effective has this been that farmers find it difficult to distinguish between income and subsidy, efficiency and inefficiency.

The first hints of change in the subsidy system occasioned much wailing about farmers losing their income and being unable to survive in the business. In fact, they are not surviving in the business - they are kept there by the taxpayer in accordance with government policy. The complete lack of realism showed itself when the large, intensive arable landowners of the UK, who have in the past managed to pocket a large proportion of the subsidy and who are particularly unpopular in the country, complained bitterly that the possible withdrawal of subsidies will destroy the most efficient farmers in western Europe, namely them. The Greek minister of agriculture asked pointedly why they needed hefty subsidies if they were so efficient. Greek farmers do not even pretend to be efficient. They simply demand EU support by various forms of emotional blackmail.

Nor do farmers of other countries, such as the UK, eschew emotional blackmail. By presenting themselves as the main food producers, defenders of the nation's food security or guardians of its countryside, they endlessly promote the view that farmers should somehow be supported, protected and cherished regardless of all circumstances. However, a healthy skepticism has been creeping into the public's consciousness, partly because of the various unattractive aspects of the CAP but also because of a perception that there is something desperately wrong with the farming of this country as we lurch from one catastrophe to another. When taxed with the problems and environmental damage that subsidized farming has created, the same farmers who tell us that they are the only possible guardians of the countryside look pathetic and insist that none of this was their fault - they were paid to tear up the hedgerows, destroy the topsoil, turn sheep-farming into a disaster and so on. And there the matter stands with the two sides staring at each other in uncomprehending hostility.

Yet some kind of solution could be achieved if we moved away from the notion inculcated into most of western Europe in the years immediately after World War II that farmers must be protected and food must be subsidized. During the recent foot-and-mouth epidemic in the UK it became shockingly clear that more money comes into the countryside through tourism - foreign and domestic - than through direct food production. Only about one percent of the country's population engages in farming, thus making nonsense of the claim that farmers should speak for the rural population. Tourists do not want to see intensive farms that are supposedly so efficient but, in fact, cannot survive without hefty dollops of taxpayer's money. They prefer to go where there is unsubsidized extensive farming that genuinely looks after the environment. With modern technology, small-scale, mixed and, even, organic farming does not have to mean the back-breaking labor of the past (and present in Third World countries).

Britain cannot compete in arable farming. Far from viewing that as a disaster, we should accept it; end the complicated system of hand-outs for whatever is considered politically apt. If that means no rye or second-class wheat grown in East Anglia, so be it. If the whole area reverts to its previous attractive self and brings in visitors who bring in money because that is what they want to do, that will be all to the good. That will leave farming to those who can thrive in the British climate and on British soil and compete in the open market: livestock breeders, dairy and cheese producers and fruit growers.

A good deal of the food production in Britain will have to concentrate on niche and quality produce. Farmers who are selling directly to the consumer have managed to change their production patterns to accommodate consumer demand. Many meat and dairy products are of such high quality that they can be sold anywhere in the world. There is no real reason why commodity goods should necessarily be produced in this country whether that is competitive or not. In the modern world, these can be imported at a fraction of the price that heavily subsidized domestic production costs.

All it needs is an imaginative acceptance that the world of the 1940s has gone, that technology has made many things easy and possible and we can begin dismantling the last bastion of socialism.

Dr Helen Szamuely was born in the Soviet Union and attended school in Hungary, Ghana and Britain. She has a First Class degree from the University of Leeds and a D.Phil from the University of Oxford. She has written extensively on Russia, Eastern Europe and the European Union, and is co-author with Bill Jamieson of A Coming Home or Poisoned Chalice?, a critical study of European Union enlargement. Dr Szamuely also co-authored Alien Thoughts: Reflections on Identity published by the Bruges Group.


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