The Obama admin wants to reform food aid and the agribusiness lobby is not okay with it

Iiinteresting. The NYT reports that the Obama administration is looking to revamp the way the U.S. government distributes international food aid; it’s a recurring effort that’s been pretty much dead-on-arrival for years because of the powerful agricultural lobby’s intense support for the way the program is currently run, and predictably, they are one royally ticked off lobby right about now.


According to people briefed on the soon-to-be released fiscal year 2014 budget, the administration is expected to propose ending the nearly 60-year practice of buying food from American farmers and then shipping it abroad.

The administration is proposing that the government buy food in developing countries instead of shipping food from American farmers overseas, a process that typically takes months. The proposed change to the international food aid program is expected to save millions in shipping costs and get food more quickly to areas that need it. …

The United States spends about $1.4 billion a year on food aid and is the only major donor country that continues to send food to humanitarian crisis spots, rather than buying food produced locally.

In a letter to members of Congress and the Obama administration, more than 60 organizations like the USA Rice Federation and the American Maritime Congress defended the way the program is currently run and called on lawmakers and the Obama administration to resist changing it.

I’m going to hold off on the wisdom of spending taxpayer dollars on international food aid and the often accompanying “soft power” tactics — whether or not it’s a good idea, let’s accept for a moment that the United States is going to spend a couple of billion on food aid in some form every year no matter what.

As our food aid program functions now, it’s more of a roundabout export subsidy for American agribusiness than anything else — the humanitarian aid might be the stated goal, but it’s kind of incidental. The law requires that most international food aid much be purchased from American farmers, and the federal government resells and ships U.S. crops to poverty-, disaster-, and/or famine-stricken areas overseas. Sure, it’s a convenient way for farmers to unload some of their excess production, but it also floods these overseas markets with subsidized American food that can displace sales from local producers and neighboring countries, contributing to market instability in these regions.


Critics of the food aid program argue that it would be more cost effective to eliminate the American-grown requirement and instead allow the U.S. to send help to impoverished areas via purchasing food from abroad, too, helping to get rid of some of the shipping costs and red tape.

Advocates maintain that the program supports U.S. agriculture and shipping jobs (albeit because the federal government is helping to subsidize and artificially inflate a particular market), but if the end goal of the program is really to stretch our dollars the farthest in helping the needy, then reform that would instead allow the cash to perhaps be directed overseas would probably be a more cost-effective route.

If Obama’s proposal is geared toward the U.S directing those aid dollars toward wherever they can be spent most cost-effectively (though I’ll wait until I actually see it to judge), then I am actually for it. Both Republicans and Democrats never seem to find a shortage of excuses for the farm lobby’s market-distorting practices, and if our goal is to get the most bang for our buck in delivering humanitarian aid, then it’s a pretty good idea.

This reform would speed up the delivery of aid to people facing starvation while maximizing our use of taxpayer dollars. Multiple studies by the GAO, leading academics and others suggest that purchasing food nearer to hunger crisis areas would cut in half or more the seven months it now takes to buy food here and ship it half way around the world. And the cost savings would be enormous. The U.S. Agency for International Development estimates that up to half of its spending on food aid now goes to ocean transportation costs.

Our agricultural, foreign policy and national security objectives would be better served by focusing our efforts more precisely toward getting food aid as quickly as possible to the people who desperately need it.


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