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The Assault on Agricultural Protectionism

Courtesy Reuters

Buffeted by drought and protectionism, agriculture is emerging as a key issue in the politics of international trade. Because international agriculture cannot be divorced from domestic farm programs, foreign trade officials and others in the diplomatic community are being forced to confront issues beyond their normal purview. "I sit there talking about soybeans," lamented Italian Foreign Minister Guilio Andreotti during an interminable debate with his European partners, "and I don’t even know what the miserable things look like."

The complex nature of agricultural protectionism has long served as a barrier to popular and political understanding—a state of affairs useful to the special interests that benefit the most from this protection. The inconsistencies, inefficiencies and inequities that riddle farm policies have usually been of interest only to a relatively small group of specialists. As President Kennedy reputedly told his principal agricultural policy adviser: "I don’t want to hear about agriculture from anyone but you. . . . Come to think of it, I don’t want to hear about it from you either."

As long as the costs of farm programs were low and foreign markets for surpluses were growing, politicians and economists could afford these short attention spans. But in the mid-1980s budget costs for agriculture rose dramatically in both the United States and Europe. Shrinking foreign demand led to falling farm incomes, yet price support programs continued to pay farmers far more than the market for their products. In recent years on each side of the Atlantic these costs soared to over $25 billion annually, but even such massive programs have failed to prevent a record number of farm bankruptcies. In a desperate attempt to unload surplus production, export subsidies have been used to dump grain and other agricultural commodities on the world market, lowering prices and threatening a global trade war.

The parties to the General Agreement on Tariffs and Trade have begun to debate the farm trade issue as part of a broad effort to reform the global

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