In which I praise our former president

I remain skeptical as to the underlying intent, but the fact remains – George W. Bush was the first president in recent history to attempt to loosen the absurd restrictions placed on U.S. food aid. For that, I tip my hat, if only to keep it out of the way of porcine hooves overhead.

Understanding the magnitude of Bush’s proposal requires some historical perspective. The formal program of food aid in the United States began in 1954 with the Agricultural Trade Development Assistance Act. Eisenhower was direct about the program’s commercial intent, stating that its objective was to “lay the basis for a permanent expansion of our exports of agricultural products with lasting benefits to ourselves and peoples and peoples of other lands.”  The program was folded under USAID, the foreign aid section of the State Department.

From its inception, donations under the Act (activity which was subsequently renamed “Food for Peace” in 2008) have reflected the philosophy laid out so clearly by Ike. All food donations must be purchased by the government from U.S. farmers, and can only be transported on U.S.-owned vessels. While other donors had historically incorporated elements of these practices into their own policies, all but the U.S. have since dropped them in favor of some mix of domestic food and cash purchases of food from countries in the region of the recipient (called local and regional procurement, or LRP). LRP is typically done through the U.N.’s World Food Programme (WFP).

The costs of the American approach have been steep for the recipients. A 2009 GAO report on LRP found that average transit time for domestic food donations to international sites was 160 days, while regionally procured food reached its destination in roughly a quarter of the time, and locally procured food still less.

The report also found the domestic-only policy to have significant excess costs for the U.S., with delivery of domestic grain to Sub-Saharan Africa costing up to 34% more than local procurement. Overall, the GAO found that the WFP was able to deliver food aid more economically than USAID 86% of the time.

The costs to farmers in recipient countries are also enormous, though they were not part of the GAO report.

Enter the Bush administration. At roughly the same time the administration began its push into ethanol (which has had its own damaging effects), the government in 2005 proposed to shift up to 25% of the $2 billion in annual food aid procurement from domestic grain to LRP. This was blocked by Congress, largely thanks to our arcane system of over-representation of low-population farm states in the Senate. The one allowance made by Congress was for very small-scale pilot programs as part of the 2008 Food Bill. The GAO study was part of the pilot program. I don’t have time to check on it now, but it would be interesting to see whether there was any subsequent progress.

With special thanks to RS for invaluable help with our fine feathered friend.

This entry was posted in Food markets & development. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s