July 3rd 2004

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Articles from this issue:

COVER STORY: NZ Labour legislates to effect 'same-sex marriage'

EDITORIAL: Free Trade Agreement's tilted playing field

ECONOMICS: Setting pay to create new jobs

NATIONAL AFFAIRS: Profile of Mark Latham's star new recruit

AGRICULTURE: Western farm subsidies rising, Australia's falling

OVERSEAS DEBT: Foreign debt grows as we live beyond our means

SAME-SEX COUPLES: Gays comprise 0.5 per cent of couples: parliamentary survey

FAMILY: Neurobiology says mothers play vital role

EDUCATION: The gender agenda

POLITICAL IDEAS: Distributism - the neglected tradition

COMMENT: The 'battlers' want jobs, not platitudes

EUROPE: New EU Constitution faces mounting opposition

STRAWS IN THE WIND : Moving the lounge chairs in the retirement village / Still picking up the pieces / Selective indignation

Flouting the law (letter)

Grameen Bank (letter)

Howard Government defended (letter)

Restoring Murray River communities' confidence (letter)

Reagan's wit (letter)

BOOKS: Target North Korea, by Gavan McCormack

BOOKS: An Imperfect God: George Washington, his slaves and the creation of America

Books promotion page

Western farm subsidies rising, Australia's falling

by Patrick J. Byrne

News Weekly, July 3, 2004
In the face of rising farm subsidies across Western nations, only Australia and New Zealand have cut assistance to farmers.

The Organisation for Economic Cooperation and Development's 15th report, OECD: Agricultural Policies 2004 at a Glance, on Western farm subsidies, found that in 2003 Western farmers derived 32% of their net revenue from government subsidies and farm support, up from 31% in the previous two years.

This assistance to farmers amounted to $A506 billion, or the equivalent of about 70% of Australia's Gross Domestic Product.

EU subsidies

The European Union accounts for almost half of the total subsidies, partly because it has so many farmers, underscoring its use of subsidies as part of the decentralisation policies of European governments.

The US provided the highest subsidies per farmer.

The highest subsidisers are Switzerland, with government support providing 73% of all farm income. It was followed by Norway (71%), Iceland (67%), South Korea (64%) and Japan (58%).

The level of support in these countries has hardly diminished since the 1980s, while US and EU support has fallen marginally over this time.

In contrast, farm support is now almost non-existent in Australia (4% of farm income) and New Zealand, where it is just 2%.

The most highly subsidised farm industries are rice farmers, who receive 78% of income from government support, followed by sugar producers (51%) and dairy farmers (48%).

These figures mock Australian politicians, bureaucrats and industry leaders who argue that Australia has to lead the way by deregulating agriculture and cut government support before we can expect other nations to follow.

The reality is that Western nations are continuing to support their farmers in an array of ways and for many reasons - to provide food security, to decentralise their populations away from mega-cities, to preserve the cultures which are rural-based, and even to support tourism.

For example, little understood in Australia is the fact that French agriculture attracts over 70 million tourists into their regional areas annually.

Agri-tourism would diminish markedly if subsidies were cut and farms abandoned or farming regions turned into mass-production agriculture.
Total government assistance as a percentage of farm incomes 2001-03
 %$US billions
New Zealand20.1
United States2044.2
European Union35101.7
South Korea6417.3

  • Pat Byrne

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