A senior US senator is pushing for more WTO-friendly farm supports as a way to end a stalemate over agriculture trade-offs in world trade talks. "It is possible to get a good deal out of (the Doha) round for US farmers, but for it to work, there needs to be continued availability to non trade-distorting support," Sen. Tom Harkin, the Iowa Democrat who chairs the Senate Agriculture Committee, said in a statement late on Wednesday.
More spending on such things as land stewardship, help for rural communities, and renewable energy "could help to find common ground and can help US farmers succeed in the future ... and reduce our vulnerability to WTO challenges," he said.
Last week, Harkin and Missouri Democrat Claire McCaskill sent a letter to President George W. Bush urging that any new world trade deal preserve and strengthen government support for these programs, which, in World Trade Organisation vocabulary, are considered "green box" spending. The so-called green box includes farm supports that do not distort trade and are not capped like other kinds of subsidies.
A major snag in the Doha round is how much money nations are allowed to spend on farmers, and how they go about it. The WTO talks have been moving in fits and starts since 2001. Negotiators now hope to produce a deal by year's end, but they must do so amid increasing ambivalence from US farmers about how much they will have to surrender in farm subsidies to secure the tariff reductions they desire.
Overall US farm subsidies are expected to be a relatively modest $14 billion this year, but they have gone as high as $32 billion since 2000. A Harkin aide said the lawmaker was hoping to build support in Congress and farm groups for greater green-box payments. His vision, the aide said, coincides with efforts in Europe, Japan and elsewhere to create a more sustainable farm policy.
But it could run head-first into insistence from US producers that they will support the round only if subsidy reductions are fully compensated by new market access. "A lot of members of Congress and lots of commodity groups are setting it up as a 'one or the other' thing," the aide said.
That attitude angers many developing-world countries, who complain that the round's original mission requires the world's richest countries to sacrifice in the interest of the poor. Harkin and McCaskill, in their letter, also urge Bush to bring home a Doha deal that contains explicit approval of such green-box programs, and ask for proof that those green-box spending items would be protected and strengthened.
Shifting farm supports to green-box payments, rather than trade-distorting programs like marketing loans or price supports, would not only mollify trading partners but would also ward off challenges at the WTO court, Harkin's aide said.
US agriculture was shaken by Brazil's WTO victory in 2005 against US cotton subsidies. The specter looms, as well, of possible challenges from Canada and Mexico. Harkin's letter came two weeks after another missive from more than 50 senators who warned the administration against sacrificing too much to obtain a deal.