Mudcat Café message #4005478 The Mudcat Café TM
Thread #165570   Message #4005478
Posted By: Iains
22-Aug-19 - 07:36 AM
Thread Name: BS: Brexit #3: A futile gesture?
Subject: RE: BS: Brexit #3: A futile gesture?
The Common EU Agricultural policy.
" Oxfam, not exactly famed for its opposition to government spending, calculated in 2006 that a British household had to pay an additional £832 a year for food because of CAP (it should be noted that another study for eastern and southern European countries that just entered the EU found a smaller inflationary effect on consumer prices). Most hit are, of course, low-income households, where higher prices on day-to-day goods have the greatest effect on their overall means. This is the same scheme that created the milk lakes and butter mountains and still exports at a loss to Africa to undercut and destroy local farm enterprises

Worse still, Brussels’ protectionism seems to explicitly favour big business over small and medium-sized farmers. The Heinrich-Böll Foundation, a think tank associated with the German Green Party, found that between 2003 and 2013, over 25% of farms in Europe went out of business. And indeed, it is mostly small farms that vanish, while bigger corporations get even bigger.

When it was established in 1962 the original purpose of CAP was to secure that there was enough food for Europeans on a continent that was still wrought from war. By the 1980s, CAP accounted for over two-thirds of the entire EU budget.

While the share of the overall budget has since gone down – to 38% under the current six-year budget – it is still the largest financial program of the union. In addition, despite having decreased in relative terms, CAP payments still increased in absolute numbers until 2013.

At 38% of the budget, European taxpayers send more than €58bn to farmers each year – a shocking amount if one considers that farmers only make up 3% of the EU’s total population and are responsible for no more than 6% of its GDP.

Indeed, while the original goal of CAP was to enable farmers to feed Europe after decades of conflict, now it’s Europe that is feeding farmers through its massive subsidies. Their businesses often only survive because they are effectively bailed out – unlike big financial institutions, these are not one-off bailouts, but day in, day out.
If all of this sounds like protectionism and an illiberal economic policy it’s because that’s exactly what it is. That much was also clear from the strongly expressed opposition to a recent free trade agreement with Latin American countries from French President Emmanuel Macron and his colleagues from Ireland, Belgium, and Poland – all countries where farmers are profiting much from CAP. Politicians across Europe are fond of telling us that farmers need “protection” from the scourge of cheap imports, as if consumers’ interest in cheaper food were of no consequence at all.

An example of the madness:
Richard Findlay is a farmer in the North York Moors National Park between York and Newcastle. As the Financial Times reported last year, Mr Findlay garners a profit of around £12,000 a year by grazing some seven hundred sheep. But even that £12,000 is quite a lot if one looks closer. Indeed, if it weren’t for subsidies delivered by the EU’s Common Agricultural Policy (CAP), Mr Findlay would be facing a loss of £32,000. Simply put, this farm would not exist if it were not for Brussels."