Canada: gloom amid bloom

Last week Ottawa announced subsidies for farmers, a rarity, unlike in the US and Europe.

Nick Parsons is on a crusade - at about 15 miles an hour.

To draw attention to the plight of family farms in western Canada, he is driving his bright red Massey Ferguson harvester from Dawson Creek, British Columbia, to Ottawa, a 3,000-mile odyssey. He's about half-way there.

"If one farm gets saved from this trip it will be worth it," he told the group of farmers who had gathered at a parking lot to welcome him to Brandon.

The grain farmers of western Canada are facing their toughest economic crisis since the 1930s, hit hard by a worldwide dip in grain and oilseed prices, bad weather, and competition from subsidized farmers in the United States and Europe. In 1998, according to the Organization for Economic Cooperation and Development, for every $100 of income, a Canadian wheat farmer saw $9 in subsidies, Americans $38, and Europeans an astounding $57. Farm subsidies are now a global issue.

Responding to mounting pressure for subsidies, Prime Minister Jean Chrtien announced joint federal-provincial emergency aid of about $275 million last week.

Reaction to the aid was mixed. One farm woman in Saskatchewan dismissed it as "chicken feed." Don Dewar, president of the Manitoba farm federation said, "It's $100 million that Manitoba farmers didn't have in their hands yesterday," referring to his province's share of the funds. Most people believe the aid is simply a stop-gap to help farmers get the spring crop into the ground.

Meanwhile, the western farm sector is facing major changes. Farmers are diversifying either into profitable crops such as beans, peas, lentils, even forage and birdseed, or into livestock. Beef and hog farmers are seeing good profits.

From the cab of his harvester, Mr. Parsons has been getting a good look at the difficult conditions on the prairies. The southern parts of Saskatchewan and Manitoba have been particularly hard hit. "I've seen low prices and a lot of foreclosures," he said. According to some estimates, nearly 25 percent of farms may have to close.

For Parsons, it's been a low-budget, or rather, a no-budget expedition: A life-long farmer, he has relied on contributions from farmers he has met along the way for fuel, food, and lodging. People lineup in cold weather to shake his hand. "Yesterday, two 65-year-olds were arguing over who would fill my tanks," he says.

In the Brandon parking lot, a farmer pressed a red-and-white $50 bill into his hand. Another gave him a check, apologizing for not being able to give cash. "I'm going broke on the farm, but I still need the receipt," he said.

As he pulled his battered gray suitcases down from the cab of the harvester, Parsons said he heard "gut-wrenching," stories from farmers along the way.

Parsons set out on his journey with the intention of gaining an audience with the prime minster and appeal for increased farm subsidies. In Brandon, however, he said he's not sure what policy measures are needed. He is sure, though, that prices for farmers need to be higher. "If we got a 10th of the cake instead of 1/20th of the cake, we'd be able to stay in business."

Parsons, an immigrant from England, worries that if corporations take over the family farm, "the housewife will soon be paying English prices for food."

Harold Bjarnason, dean of agriculture at the University of Manitoba, says, "It's not a farm crisis in Canada. It's a crisis for farmers specializing in grains and oilseeds, and especially wheat.... We produce the best hard red spring wheat in the world, but we're being forced [to diversify] because of a lack of good rules on the export of wheat and grains internationally."

Citing the European subsidies, Dr. Bjarnason notes that in Canada, with just over 30 million inhabitants, "we don't have the population or economic base to support subsidies like that."

Indeed, one major subsidy has already fallen away: No major grain-producing region in the world is farther than Manitoba from salt water; and for years Ottawa subsidized the transport costs to the ports. But this was deemed illegal under world trading rules in 1994 and was phased out.

With an economy in which over 40 percent of Canada's gross domestic product is exported, Canadian government policy has favored free trade, specifically negotiating away the subsidies that allow American and European farmers to sell on world markets for less than the cost of production. "That used to be called dumping," says Bjarnason.

"Canada strongly supports the launch of new negotiations in agriculture and services, both of which are sectors of vital importance to Canada," Pierre Pettigrew, Canada's trade minister, said earlier this month as the World Trade Organization announced the resumption of talks short-circuited at its Seattle meeting late last year.

At best, however, such negotiations would take several years to complete, and several more years to implement - hence the interest in short-term aid. "We can't have our family farms go down because we're pure as the fountain" on trade, Manitoba Premier Gary Doer said as he headed to Ottawa to negotiate the farm-aid package.

Although the Canadian Federation of Agriculture supports Ottawa's free-trade policy, support is not uniform throughout the farm community. "We contend that this whole thing of attacking subsidies is a Trojan horse," says Fred Tait, of Rossendale, Manitoba, national vice president of the National Farmers' Union. His organization favors government intervention in agriculture and has just released an international study which found no correlation between subsidies and levels of production. For NFU, the real problem is concentration of ownership in the agribusiness sector.

(c) Copyright 2000. The Christian Science Publishing Society

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