CARE Tells Agribusiness to Shove It

Erin was talking the other day (well, blogging, actually) about people in farm country trying to opt out of the existing deeply flawed agricultural system. When I posted a comment on her post, I talked about how hard it is to break out of the long-standing interest-group-driven political consensus, but that there might be some hope of change.

And this week in the NY Times, there was a sign of resistance: CARE, one of the biggest overseas aid charities, turned down $45 million in government food aid because the system is inefficient and, more crucially, undermines the very people they are trying to help.

In a nutshell: The US government buys agricultural commodities from US agribusinesses (a nice market subsidy), ships them to Africa (or wherever), turns them over to the aid organizations, who then sell the food on the local market to raise money to support their programs. Among the problems pointed out in the article: 1) More expensive for the government to buy stuff and ship it there than it is to just send money. 2) The aid organizations don't have expertise in the farm commodities market, and tend not to be able to get a good price for the food. 3) These organizations are trying to help people like small farmers, whose prices are undercut by cheap, subsidized crops being dumped on the local market.

So, only an idiot would design a food aid program this way. Unless you're with the farm lobby, and your self-interest helps you swallow all that cynicism. Of course, the article also points out that many other food aid organizations are critical of CARE's move, probably because they figure that having a powerful interest group on their side gets them enough additional support to make up for the inefficiency of the program. CARE has looked at the hidden costs of this tradeoff and decided that its subversion of their mission is too severe to be tolerated. Good for them -- such Faustian bargains not only stand in the way of effective policy, but collectively they also undermine public faith in the effectiveness of government, which is ultimately a huge drag on our political system.

(You might consider making a donation to CARE.)