The New York Times | December 30, 2003
There is a deceiving sense of timelessness to the stillness of rural life. The jungles of Mindanao offer few clues as to whether it's the early 20th century, or the early 21st. Nor do the highlands of Guatemala, the Mekong Delta in Vietnam or the cotton-rich plains of the Sahel in West Africa. But these disparate regions are very much of the present, stitched into the quilt of global commerce. World trade links us to them, as surely as it links London, Tokyo and New York.
In an effort to understand that relationship, we visited some of the poorest nations in the world in the last six months. We listened to 12-year-old Arnel Mamac's parents on Mindanao, the Philippine island besieged by an Islamist terrorist group, tearfully say they often don't let him walk to school because they fear he may not have the energy to make it on an empty stomach. In a cotton-growing village in Burkina Faso we saw a school with two rooms, but because of a lack of funds, only one classroom was finished. Most unsettling, to an American, is the realization that our nation's agricultural policies -- its protectionist trade barriers and the billions in subsidies doled out to its own farmers -- contribute mightily to the hardships felt by poor farmers in the developing world.
The club of rich nations that wrote the rules of global trade has been aggressive in dismantling barriers when it comes to industrial goods and services, in which they hold a comparative advantage. But they refuse to do the same when it comes to agriculture. Politically powerful farm lobbies in Japan, Europe and the United States are not willing to face global competition on fair terms. So agriculture remains the hypocritical asterisk to our fervent free-trade and free-enterprise creed.
It's bad enough that a country like Japan, which became wildly prosperous thanks to the willingness of the outside world to buy its exports, maintains 500 percent tariffs on imported rice. Or that the American Congress would overrule science to decree that catfish from Vietnam, which found popularity among American consumers, are not catfish after all and cannot be marketed as such.
Worse, the developed world funnels nearly $1 billion a day in subsidies to its own farmers, encouraging overproduction, which drives down commodity prices. Poor nations' farmers find they cannot compete with subsidized products, even within their own countries. In recent years, American farmers have been able to dump cotton, wheat, rice, corn and other products on world markets at prices that do not begin to cover their cost of production, all courtesy of the taxpayers.
The rigged trade game is not only harvesting poverty around the world, but plenty of resentment as well. In the Philippines, a former American colony, our agricultural trade policy is seen as a plot to perpetuate imperialism. In Vietnam, a nation that was able to start reducing rural poverty only when it deviated from its Marxist orthodoxy and allowed entrepreneurs to have access to global markets, an exasperated seafood exporter told us, "We are made to wonder if you wish us ill as much in the present as you did in the past."
In Burkina Faso, we heard a cotton farmer tell colleagues that America's bizarre cotton program could be explained only by the fact that President Bush is a cotton farmer. He was wrong. It is some leading members of Congress responsible for the $180 billion 2002 farm bill who are cotton farmers, or who blindly follow the dictates of the so-called King Cotton lobby.
The idea that our agricultural protectionism harms poor nations is hardly a fanciful one held only by aggrieved third world farmers. Just about any multilateral economic or development agency you can think of has issued reports railing against rich nations' farm subsidies. The World Bank estimates that an end to trade-distorting farm subsidies and tariffs could expand global wealth by as much as a half-trillion dollars and lift 150 million people out of poverty by 2015.
The urgent need to address globalization's imbalances, and restore the credibility of the free-trade system, has never been as apparent as it was in the raw weeks and months immediately following the terrorist attacks on Sept. 11, 2001. That November, at Doha, Qatar, the members of the World Trade Organization committed themselves to a new round of trade talks focused on the elimination of the farm subsidies that are so harmful to the developing world.
The year 2003 was to be crucial in this endeavor. A deadline of last March was set for the 146 W.T.O. members to agree on a framework to proceed on the subsidy question, with substantive agreements expected by a September meeting in Cancun, Mexico. Neither happened.
The March deadline came and went with no accord. Even more disappointing, on the eve of the Cancun gathering, American negotiators switched sides. Despite Congressional support for gargantuan agricultural subsidies, Robert Zoellick, the United States trade representative, had taken an aggressive position on the need for reform. But suddenly, Mr. Zoellick and his team joined hands with the more recalcitrant Europeans against much of the rest of the world.
There was a time when the European Union and the United States could jointly dictate terms to the rest of the World Trade Organization, but they cannot any more. Washington's betrayal of its free-trading principles outraged not only the poorest countries, but also some food-exporting allies like Australia. The developing world lashed back. At Cancun, Brazil, India and China created a formidable bloc of 22 nations that rightly opposed proceeding on anything else until some of the more outrageous farm subsidies had been addressed.
Hence the current stalemate. Negotiations meant to inject fairness into global trade are on life-support, thanks mainly to the appalling absence of American leadership. The Bush administration could have joined forces with the likes of Australia and Brazil at Cancun. Our trade representatives could have worked to overcome both the narrowest interests of the American farm lobby and the developing world's own self-defeating protectionism. Instead, the United States meekly aligned itself with a group of countries scared of fair competition.
For all the hand-wringing about a trans-Atlantic rift over Iraq this past year, President Bush stood shoulder to shoulder with Jacques Chirac of France on a matter that is far more pressing to the billion or so people on earth trying to get by on $1 a day. Together, they formed a veritable coalition of the unwilling. Despite their post-9/11 promises, the United States and the European Union defiantly refused to give up their economic weapons of mass destruction: their trade-distorting farm subsidies.
More rational agricultural trade policies would actually be a boon to many American farmers because their high-tech equipment and large, fertile acreage would make them winners in a more open competition. But there would be losers both here and abroad, and we visited some of them as well, to understand all sides of the story. Ronnie Hopper in Texas, Hubert Duez in France and Koushi Seiwa in northern Japan are all smart, gracious, hard-working farmers. But as appealing as they are as individuals, they have been given an unfair advantage by nostalgia-driven policies that are indefensible on economic, and even moral, grounds.
In a rational global marketplace that conformed to our stated values and commitments to the rest of the world, consumers would forgo Mr. Hopper's cotton, Mr. Seiwa's rice and Mr. Duez's sugar, and buy from others who are now being shut out of the global economy.
This does not mean that rich nations ought to halt their rural development programs. But farmers must be weaned from payments that merely reward them for overproducing crops on which they would otherwise lose money. Such madness is no longer sustainable. Besides proving so costly for taxpayers and for the developing world, there is too glaring a gap separating American and European agricultural policies from the entire logic of the global trade system. Now the developing world is demanding consistency, and a fairer playing field.
The Bush administration, which has been so proudly proactive in Iraq, could jump-start reform with a sweeping unilateral gesture. The ideal starting point would be the dismantling of the most wrongheaded market distortions, our astronomical cotton subsidies and our sugar quota system, which props up domestic sugar prices by restricting imports. But instead of moving in that direction, the president, ostensibly a free-trading Republican, signed the most trade-distorting farm bill in history.
The dutiful Mr. Zoellick may travel the world saying all the right things, but his boss does not seem to appreciate the degree to which trade is integral to broader economic and foreign policy, and to the projection of American power around the globe. Does President Bush sit down with Mr. Zoellick, Condoleezza Rice and his top cabinet officials for far-ranging discussions on farm subsidies and the Doha round of trade negotiations? He should.
Next year's election offers little hope on this score. Democratic lawmakers were among the strongest supporters of the 2002 farm bill, and most of the candidates vying for the Democratic Party's presidential nomination seem to have turned against the Clinton administration's belief that freer trade is a win-win proposition for rich and poor nations alike.
Trade frictions may grow worse, therefore, before we stop harvesting poverty around the world with our farm programs. It could take a threatened collapse of the global rules-based trading system for the political balance of power from Washington to Tokyo to shift decisively against the coddled farm lobbies. But until we start chiseling away at our farm subsidies, the promise of trade will remain a promise unkept for many of the world's poor. Harvesting Poverty: Editorials in this series remain online at nytimes.com/harvestingpoverty.The New York Times:
