Intervening in farm markets for the public good

Farm & Countryside Commentary by Elbert van Donkersgoed

Editor's NOTE

This column was adapted from one of Elbert van Donkersgoed's weekly radio chats, called Corner Post, which are aired weekly on CFCO Radio in Chatham and CKNX Radio in Wingham, Ontario. Elbert is the Strategic Policy Advisor of the Christian Farmers Federation of Ontario, which is working hard to create a more satisfying and sustainable model for farming in the province. If you'd like to receive a transcript of Elbert's Corner Post address each week, send an email to evd@christianfarmers.org with SUBSCRIBE as the message.

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NOVEMBER 5, 2002: An American farm journalist sent me a note the other day: "What I'd be most interested to hear from you is your view of marketing boards. We hear a lot in the States about how it's bad to have a Wheat Board -- a government monopoly. Would I be correct in thinking that, for whatever problems associated with the Wheat Board (and dairy and poultry boards) that the Canadian government and people have decided that it should come down on the side of farmers, instead of leaving them to market their crops individually and taking their chances?"

I've been a fan of supply management for a very long time. A 1972 policy statement adopted by the Christian Farmers Federation says: "Supply management programs in agriculture are an effective tool against injustice, misuse of power, opportunism, unfair competition and low returns to family farmers."

Granting supply management powers to farmers is a far better approach to supporting agriculture than allotting massive subsidies. Americans should remember that if Canada were to give up managing the supply of milk, eggs and poultry for our own markets, we would not give up producing milk, eggs and poultry. We would just join them in the drive for efficiency to live
with lower prices.

If we drop supply management our competitiveness will drive North American prices still lower. They will pump their government for still bigger subsides. We too would be forced to seek new safety nets. The supply management approach is a far superior approach to the common good -- farmers are paid a fair price by those who consume the food they produce.

There are two other reasons to support supply management in agriculture: it is both necessary and inevitable in the food system.

Supply management is inevitable as the food system is restructured as value chains. The strength of value chains lies in their ability to manage the supply of raw materials and products from field to table. A private supplymanagement system is emerging. The question arises: How are these value chains different from the price fixing that is so abhorrent to the publicgood? By comparison, the public good is better served by opting for a publicly accountable and transparent supply management system at the farm level.

Supply management is necessary because agriculture constantly pressures creation to produce more than enough -- more than economic demand. The routine production of surpluses is a waste of environmental resources -- an unacceptable pattern in a society committed toward environmental stewardship. Each year the unfettered marketplace reduces creation to subsidizing our living standards.

I value markets. When they don't deliver for the public good its time to intervene .