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Draft Paper – Not to be cited without author’s permission

Appendix 1 (p36) lays out the format of the negotiations, and their organization into so- called “boxes.” It also explains how the U.S. and the EU are perceived by others to move subsidies from one box to another in the course of the negotiations, in what might be called a “hide-the-subsidy shell game” that infuriates Third World negotiators.

Most importantly for the U.S. and the EU, an agreement was reached on greater cuts for

tariffs that are currently high, and smaller cuts for lower tariffs.8

While this seems

reasonable at face value, it actually discriminates heavily against poorer countries. While wealthier countries can support farmers in numerous ways that require significant levels of spending, poorer countries cannot afford the outlays. Virtually the only way they can support their farmers is through tariffs or other restrictions on imports that limit dumping in their home markets and help keep domestic crop prices up. An Aug. 1, 2004, article in the New York Times makes this clear:

“The United States was pleased that negotiators agreed that the highest tariffs should be cut the most, a move that would mean a greater opening for American agricultural products in the developing world. ‘We feel this is a win-win for the United States, the WTO, exporters, consumers, developed and developing countries alike,’ said a American trade official who asked for anonymity.’” 9

Industry was not shy with its praise.

“The potential benefits for the U.S. economy are

significant. U.S. goods and services will enjoy greatly

markets,”

said

the

U.S.

Chamber

of

Commerce.

The

improved access to foreign Corn Refiners Association

(including large conglomerates like ADM, Cargill and Corn added “this framework lays the groundwork for U.S. negotiators

Products International) to open new markets for

the

corn

wet

milling

industry.”10

Perhaps

we

can

framework for negotiations represented no net change

say that on the from business as

balance, usual.

the

new

The recent WTO ministerials have drawn global attention for the conflicts and protests they engender. Box 1 (p 24) summarizes these and other key recent events of the world trade controversy. But what’s all the fuss about? Why has it been impossible for governments to come to agreements about trade in agricultural products, farm subsidies and related issues? Why are farmer organizations so up in arms?

4

Key Issues, Misconceptions, Points of Disagreement, and Alternative Paradigms

In order to sort out the confusion of often contradictory positions and misleading rhetoric from governments, it is useful to single out the key issues, highlighting where there are

common misconceptions and the central points of disagreement between and between governments and key sectors in the global public sphere. The and short explanations serve as a useful guide to the larger debate. concludes with two alternative paradigms that have been contrasted with trade liberalization model.

governments, following list This section the dominant

7

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