Food aid reforms came under the spotlight last month when the Obama Administration announced its Fiscal Year 2014 budget.
The changes are important to humanitarian response. Oxfam America estimates that reforms to food aid procurement laws could speed up crisis response by 14 weeks and reach an additional 17.1 million people. For a crisis like the 2010 drought in the Horn of Africa, that improved response time could have saved thousands of lives.
“The current approach to food aid can become, at times, an impediment to its very own mission,” said USAID Administrator Raj Shah.
Humanitarian groups were mostly supportive in response and contractors were unhappy that changes would affect their business. What looked like positive momentum for reform is starting to slow down as both houses of Congress take a look at the Farm Bill and food aid reform both in and out of the United States.
“The agriculture industry in the Midwest sees this as a threat to exports, which is ridiculous,” said former USAID Administrator Andrew Natsios to Businessweek, a supporter of food aid reform during his tenure with the Bush Administration.
The red pen continues to make it through the US federal budget debate and the Farm Bill will see a few billion trimmed from its roughly $100 billion annual budget. The Republican dominated House and the Democrat led Senate do not see eye to eye on all of the cuts and changes, but they are on the same page when it comes to subsidies, says the Washington Post.
Both bills would eliminate the roughly $5 billion in annual subsidies known as “direct payments,” which automatically support certain types of farmers regardless of their crop prices or yield. The Senate version would terminate the program immediately, while the House measure would wean cotton farmers off it during the next two years.
The two measures would also increase subsidies for federally subsidized crop insurance and create a new program to cover small losses on planted crops such as corn and soybeans.
That will be some level of good news for international farmers who are impacted by US farm subsidies. Haiti is one place where the agriculture sector is harmed by cheaper US imports. Former President Clinton admitted as much not too long after the earthquake.
“I have to live every day with the consequences of the lost capacity to produce a rice crop in Haiti to feed those people, because of what I did,” said Clinton. “It may have been good for some of my farmers in Arkansas, but it has not worked.”
This news comes shortly after the Obama administration unveiled what many agree was a bold and important reform of US food aid policies. In short, the changes would mean more food aid will be sourced locally as opposed to from the US, where costs and slow response can hamper the response to an emergency. It also allows for the use of food vouchers, an policy that will give people the opportunity to buy food in their own markets thus empowering personal decision making and ensuring that aid reaches people in need swiftly.
Kimberly Ann Elliott of the Center for the Global Development praised the announcement, but warned against inflexibility of response.
“Freeing food aid from the current in-kind and cargo preference shackles would allow some of it to be used for local and regional purchase, or for food voucher programs, that could support local markets and raise producer incomes in developing countries. But local and regional purchase can distort markets and will not be the right answer in every situation. The administration should focus on adding flexibility to US food aid, rather than replacing one set of shackles with another,” wrote Elliott.
Natsios argued that the reforms were not only vital, but needed to be a part of a move to de-politicize humanitarian aid. He makes the case that US wheat imports into Afghanistan at a time when the markets were collapsing made it easier for farmers to shift away from wheat and towards poppy production. An opportunity to bolster Afghan farmers and reduce the drug trade was missed.
The Bush Administration and his office learned its lessons and tried to reform food aid procurement rules, but lost time and time again to domestic interest groups like shippers and American farmers. Obama’s plan is a step forward, but not entirely new. It too is meeting resistance from the same interests in maintaining the status quo and they are reaching members of congress on both sides of the aisle.
“Reductions in funding for this program – or changes in how it operates – would significantly reduce the amount of U.S. farm products our nation could provide to those in need around the world. It would also threaten our national security preparedness by reducing the domestic sealift capacity on which our U.S. military depends,” said Congressmen Elijah E. Cummings (D-MD) and Duncan Hunter (R-CA) in April.
The farm bill in the House does little to change US emergency food procurement rules. The Senate does include the provision of $60 million over five years to buy food in developing countries, a number much smaller than the White House proposal.
An OpEd from the Washington Post editorial board raised some concerns about the resistance to the reforms. It points out that the opposing members of congress come from the parts of the country that are affected by the reforms (farm country and port areas). They go on to make the case the international shipments are declining and the argument to preserve the business is off the mark. They are confident that the case can be made the the American public.
“Perhaps it’s true that funding for foreign aid, always politically tenuous, has depended on greasing interest groups. But it’s also true that foreign aid depends on persuading taxpayers in general that their funds are being well spent. And there are more taxpayers than special interests,” write the editors.