Draft Paper – Not to be cited without author’s permission
countries should be able to protect any key food crops without having to prove dumping is taking place.
Third, experience tells us, nevertheless, that it is hard for politically weaker countries to impose countervailing duties to protect themselves from the dumping practices of powerful countries. The world trading system is based on profound asymmetries of political and economic power. To effectively end dumping will require complementary policies inside the United States, the European Union, and other major agroexporters. These must be policies that ensure that export prices capture the full cost of production, including the cost of marketing and a reasonable profit. In the United States, where domestic and world prices are pretty much the same, this could be done by reestablishing a floor price for crops. This would function much as a minimum or living wage law would, forcing corporations that want to buy commodities from farmers to at least match the floor price offered by government. If this price is set at least at the cost of production plus a fair profit, it would ensure that commodities are not placed on the market at dumping prices. A significant side benefit for the US farmers would be to guarantee them fair prices for what they produce.
6.1.2 Supply Management: Regulate Overproduction
Perpetual global over-production is a mutually reinforcing, downward spiral for the world’s farmers, as they struggle to produce more and more to compensate for lower and lower prices, matched against the ever higher production costs of the industrial farming model. A relatively small number of agroexport powers, led by the U.S. and EU, are responsible for most of the over-production. It is notable that the major coalitions exclusively for family farms in both the U.S. (the National Family Farm Coalition) and in Europe (European Farmers Coordination)—both are members of Via Campesina—call for return to supply management policies, not just on a national level, but internationally as well (see Box 4, p30).
Clearly, regulating production runs counter to market fundamentalism. Yet we are a far cry from the Adam Smith vision of free markets when we have such high levels of market concentration, which economists agree severely distort market signals. Farm organizations want to get out of the downward spiral they find themselves in, and are crying out for sensible regulation.
To do this requires two steps.38 The first is to reinstate improved production-limiting policies for key crops in the US and the EU. The only proven ways to reduce production in the North are production quotas and taking land out of production, while reinstituting public management of surpluses—for the public good—and prices . There must be some
sort of mechanism which keeps control of the surpluses, and representatives in planning and
agribusiness from seizing effective, even if indirect,
which involves both government
and family reserves will
likely need to be a central part of the exist, one of them being the Canadian
system. Good models to learn from—not copy— Wheat Board. Added benefits include encouraging