EU Farm Subsidy Reform

Any time that a body of lawmakers starts tinkering with farm programs I cringe. I am not a big fan of subsidies, however, the subsidy tools in place in most countries are necessary for a number of reasons: 1) food security - price supports are sometimes necessary to insure that farmers survive and can produce, 2) national security - a country that imports all of its food is at the mercy of the nations from which it imports and 3) land use - influencing land use for sustainability and environmental stewardship can be done through subsidies.


EU to reform its farm subsidies

By Dominic Laurie Europe
business reporter, BBC News, Brussels

The EU Commission has proposed reforms to the Common Agricultural Policy (CAP), which eats up 40% of its 106bn euro ($157bn; £76bn) annual budget.

Agriculture Commissioner Mariann Fischer Boel says the changes will make it fit for an enlarged 27-state EU.

The biggest change would be to reduce subsides above 100,000 euros by 10%, above 200,000 euros by 20% and above 300,000 euros by 45%.

The amount of land a farmer has...(complete article here).

It appears that the policy changes suggested will continue to benefit the largest producers and will eliminate the micro-farmers from the program. This is somewhat counter to what I perceive is a trend in modern agriculture. I foresee a bi-modal model in which there are large corporate-type farms that produce commodity crops for fuel and feed and then there are micro-farms that are focused more on fruits and vegetables and other specialty crops. Both need to be encouraged, supported and "influenced" through subsides rather than regulation. It is the "carrot" rather than the "stick."