A University of Michigan study frequently quoted by the US administration predicts that a one-third cut in foreign tariffs would mean an extra $2,500 a year in increased income for the average American family of four, according to DesMoinesRegister.com.
I like that — emphasising the positive benefits to the whole community rather than concentrating on the effect on farmers. The article doesn’t mention the huge benefits that abolition of subsidies would have in boosting Third World agriculture. But let that pass. If appealing to self-interest is the best way of achieving progress then let it be.
For the record, Iowa farmers receive up to $2bn a year in subsidies. Could go a long way in Africa.
Recent posts have mainly been about America but, of course, Europe is just as bad (and Japan even worse)
As Anand Menon reminds us in the
Financial Times (registration needed after a time lag), Europe suppoprts its sugar producers with an astounding tariff of 300% while also dumping 5 million tons a year on world markets at knockdown prices.
Without such a gargantuanly uneconomic — and immoral — subsidy European farmers wouldn’t find it profitable to grow sugar beet.
Guess who would then be able to grow it instead?