Food, Fuel and Green Revolutions: The U.S. 2007 Farm Bill slogs forward

Food, Fuel and Green Revolutions: The U.S. 2007 Farm Bill slogs forward

Download a PDF

The 2007 Farm and Food Bill is mired in the no-man's land between the recently passed House version ("Farm, Nutrition, and Bioenergy Act of 2007) and the yet to be agreed upon Senate version, which lawmakers say may take well into October. Then the two versions must be reconciled in House—Senate conference before going to the president to be signed into law—perhaps as late as next year. Every step of the way, Republicans and Democrats, urban and rural lawmakers will fight over what is to be done and who will pay for it.

That's actually good news. Weighing in at $286 billion, the five-year proposal the House of Representatives agreed to in July is largely a depressing exercise in "more of the same." Afraid of losing farm state support in the approaching elections, Democrats were careful to keep the farm subsidy system intact. Even Democratic House Speaker Nancy Pelosi's timid $1 million dollar cap on individual income for farm subsidy payments was five times higher than President Bush's proposal. Corn, wheat, rice, soybeans, & cotton—the scourges of poor diet, farm loss, environmental damage, and misuse of tax dollars—will receive the lion's share of subsidies (about $7.5 billion a year). The new bill does nothing to dismantle the concentration of subsidies in the hands of large agribusiness. As pointed out by analyst, Kari Hamershlag of the California Coalition for Food and Farming, "Three cotton farmers in California will receive, in one year, the entire national budget dedicated to organic research and extension. Five corn growers in the Midwest will receive the equivalent of the annual budget dedicated to supporting farmers' markets." 1

There are, however, a number of hopeful aspects in the House bill that will need to be defended (and funded) when it goes to the House-Senate negotiations. For example, thanks to the Congressional Black Caucus, the bill includes an increase in funding for nutrition programs, $100 million to settle the discrimination lawsuits against Black farmers and priority funding of agricultural programs at "Historically Black Colleges and Universities and Native American Universities."2 It provides $20 million discretionary funding for a new Rural Entrepreneurs and Micro-Enterprise Loan Program that offers grants, loans, education and assistance to rural entrepreneurs; authorizes a Healthy Food Urban Enterprise Development Program; and provides grants for feasibility studies for the establishment of processing and distribution facilities. It includes $90 million for different aspects of organic production, including research, extension, conversion, and marketing. And, there is $35 million for farmers markets. Unfortunately the bill eliminated $5 million in mandatory funding for Community Food Projects while adding $30 million in discretionary funding. Finally, Democrats pushed for up to $70 million for schools to purchase fresh fruits and vegetables and authorized a $10 million nutrition program to address obesity. In a symbolic gesture to address hunger and poor nutrition in isolated neighborhoods, the bill recommends that various federal agencies work together to assess "food deserts" and develop recommendations to eliminate them. Importantly, there is $75 million in technical assistance for "Socially Disadvantaged Farmers and Ranchers."

Unfortunately, the Farm Bill's Energy Title also provides up to $350 million in loan guarantees for "Biorefineries and Biofuels Production Plants," along with a host of other programs to promote agrofuels, mainly ethanol. When these incentives are combined with existing ethanol subsidies (between $ 5.1 billion and $6.8 billion in 20063), and with the potential five-fold increase in energy targets proposed in the Senate energy bill (see below), a full-scale stampede on corn ethanol will likely result.

With only 19 Republicans supporting the House Bill, it has weak political buy-in and can be easily vetoed by the President. Though the Democrats have a majority in the Senate, there is no guarantee that the good things in the Bill will be left in, or that more potentially destructive components (like most of the Energy Title) will be taken out. The slow legislative process provides an opportunity for continued pressure on Congress for a fair Farm and Food Bill.

For more background go to: 


• http://www.foodsecurity.org/
• http://www.nffc.net
• http://www.agobservatory.org/issue_farmbill2007.cfm
• http://www.senate.gov/
• http://www.foodsecurity.org/

Then call your Senators with your concerns about the Farm (and food) bill or go to http://www.congress.org

For decades the U.S. Farm Bill has used taxpayer subsidies to keep grain prices low, causing overproduction
that benefited big grain companies who then dumped cheap grain abroad at below the cost of production. This subsidized overproduction—coupled with free trade agreements and the devastating polices of the International Monetary Fund—forced millions of small farmers in the Global South out of farming. Many of the 1.1 million immigrants crossing the U.S.'s southern border each year are these farmers, who can no longer afford to farm. In the U.S., over-production of grain encourages over-consumption of cheap, processed, unhealthy foods. It has concentrated market power in the agri-business sector, making farmers worldwide dependent on a handful of corporate giants for their inputs and their markets.

Though the economic power of the agri-foods industry (and their lobbyists) is strong, many observers maintain that conditions for far-reaching agricultural reform in the U.S. have never been better. This is because our food systems are in a profound state of flux and transformation.

First, as the Food First Backgrounder, Biofuels: Myths of the Corporate Agro-Fuels Transition explains, the "agro-fuels boom" is transforming our food and fuel systems worldwide, bringing both under one enormous industrial roof. There will be big winners and losers in this transition. The question is not whether agro-fuels have a place in our future—they are inescapable—but whether or not we allow a handful of global corporations to determine the future of our food and fuel systems.

Another major element transforming our food systems is the global liquidity crisis: money is backing up in the world's banks. Globalization has efficiently concentrated enormous wealth over the past 20 years. We now have 500 billionaires and over a million millionaires in the world—while the number of people living in poverty continues to grow. Banks are driven to loan; otherwise they are stuck paying interest, with no income to offset that interest… Extractive sectors including agro-fuels, oil and mining are prime investment opportunities because of their capacity to absorb large sums of investment capital quickly. Multilateral development banks, including the World Bank and the Inter-American Development Bank, provide governments with loans to re-structure laws, markets, and local infrastructure to favor corporate investment— often at the price of local food security. Two pending 2007 Food First Development Reports will detail how the World Bank's territorial restructuring in favor of mining corporations is driving farmers from the land, channeling precious natural resources to foreign businesses, and undermining food security
in Ghana and Guatemala.

At the same time, activism in the U.S. and worldwide on food, environment and social justice issues is at an all-time high. From underserved neighborhoods of people of color fighting to ensure health and nutrition, to slow food advocates seeking quality food, to farmers producing for the local market, people are taking back their local food systems from the corporate agri-foods industry. Paul Hawken, author of Natural Capitalism and Blessed Unrest, How the Largest Movement in the World Came into Being and Why No One Saw It Coming claims that there are a minimum of 130,000 registered civil society organizations working for social and environmental justice on the planet—there may be as many as one million. These organizations are reacting to the negative changes in our food systems and then advancing alternatives, shaping outcomes, and building parallel systems serving millions of people. They have held the largest anti-war demonstrations in the history of the world and the largest immigrant rights demonstrations
in the U.S. since the Civil Rights Movement in the 1960s. They are taking matters into their own hands by setting up thousands of gardens in schools and on vacant lots, challenging government on food regulations and strengthening local food systems through farmers markets, community supported agriculture (CSA), and by educating themselves about where food comes and how much energy it takes to transport it to market. They are creating markets and extending the meaning of organic, fair trade, and direct trade, and are re-building local economies by re-investing the food dollar in local production, local processing
and local distribution systems.

All of these actions are pieces of an international movement that is organizing and putting pressure on government officials for food sovereignty— the right of people to control their own food system. The struggle for food sovereignty is the struggle for control over the transformation of the world's food and fuel systems.

The 2007 Farm and Food Bill could advance the process of agricultural reform in favor of food and fuel sovereignty. There are a number of "marker bills" before the Agricultural Committee in Congress with provisions to ensure a fair price to family farmers, put a cap on subsidies, encourage fruit and vegetable production, resource conservation, research in organic agriculture, and the rebuilding of local food systems in underserved communities. Contact your congressional representative and Senators to urge them to vote for a 2007 Farm and Food Bill that provides for a fair price for all farmers—not just the large corn, wheat, soy, rice, and cotton farmers.

The U.S. Senate proposes a five-fold increase 
in agrofuel targets by 2022

The recent U.S. Senate Renewable Fuels Standards (RFS) mandate of 36 billion gallons of agrofuel by 2022 is a massive, five-fold increase in agrofuels use in the United States that will lead to substantial environmental damage and transform our food and fuel systems in ways that will not benefit consumers, family farmers, rural communities, or the environment. The intensive crop production required to meet this target will threaten sensitive lands—including forests, wetlands and native grasslands—and will harm biodiversity, soil health, water quality and wildlife habitat. The processing of agrofuels will significantly deplete water resources and put low-income communities at risk of pollution from ethanol plants.Of the U.S.'s 36 billion gallon mandate, 15 billion is reserved for corn ethanol. Achieving this volume will require the use of 45 million acres—nearly 50 percent of the current U.S. corn acreage. The social, economic and environmental impacts of this expansion would be unprecedented:

1. Corn cultivation involves intensive application of synthetic nitrogen fertilizer, which pollutes water sources and has contributed significantly to the "dead" zone in the Gulf of Mexico. Corn cultivation also emits nitrous oxide, a highly potent greenhouse gas. To produce a gallon of ethanol takes three to five gallons of irrigation water and produces up to 13 gallons of waste water.
2. The processing of ethanol and other biofuels will significantly deplete water resources in agricultural regions of the United States.
3. The ethanol boom threatens food security of the most vulnerable consumers: From 2006-2007, the prices of corn, wheat and soy—all primary components of feed and processed food—rose 68%, 27% and 29%, respectively, largely due to the ethanol boom.4 The rise in feed costs has already increased the cost of milk in the U.S. This has serious implications for the 35 million hungry people in the United States the USDA refers to as "food insecure."

The remaining 21 billion gallons in the Senate RFS, defined as "advanced biofuels" will create its own environmental problems. "Advanced biofuels" in the legislation refers to virtually any type of biofuels not produced from corn kernels. The bill's definition is so broad that it includes imported biofuel sources such as palm oil from Southeast Asia and sugarcane ethanol and soy biodiesel from Brazil. As a result, establishing a dramatically expanded mandate makes it almost inevitable that a significant proportion of the agrofuel requirement will be met with imported sources, which already constituted 10 percent of U.S. agrofuels use in 2006 (despite a $0.54 tariff on ethanol). The environmental and social impacts of these agrofuels will be particularly harmful with palm oil-based fuel produced in Southeast Asia and sugarcane ethanol and soy-based diesel from sources in Brazil, where environmental destruction and the violation of labor and land rights are serious and widespread problems.

In addition to the potential for environmental damage, agrofuels will not likely benefit U.S. family farmers, rural communities, or sustainable agriculture. Out of a total of 119 currently operational ethanol plants, 49 are presently owned and operated by farmer owned associations, accounting for 34% of the nation's total capacity. However, there is a strong trend towards greater corporate ownership. Out of a total of 86 plants now under construction, 88% are owned by large corporations. When completed, the farmer owned percentage of total plant capacity will fall to less than 20%. Five corporations control roughly 47% of all ethanol production.5 The current ramp-up in agrofuels guarantees that major industrial agribusiness corporations will reap the greatest gains from the greatly expanded sector. By neglecting issues of market consolidation, present tendencies in U.S. legislation tilt the playing field in favor of the largest corporate actors in the industry.
These corporations require government support through subsidies, tariffs and tax breaks to compete in the market. Ethanol subsidies amount to as much as $1.38 per gallon—about half of its wholesale market price. In 2006 the combined state and federal support for the U.S. ethanol industry was between $ 5.1 billion and $6.8 billion. Subsidizing corporate agrofuels only serves to undercut the creation of a biofuels sector that would be truly focused on family farmers, rural communities, sustainable agriculture, and food security.

The organization for Economic Cooperation and Development Round Table on Sustainable Development released a report titled Biofuels: Is the cure worse than the disease? on September 11, 2007 in Paris. The report argues strongly against the industrial North's agrofuels subsidies and renewable fuels targets -that are primarily green lights for the inefficient production of ethanol and advocates a balance of government funding for alternatives as a safer and saner way to move forward. The report claims that the massive funding being invested in agrofuels may not turn out to be a good long-term solution politically, economically, or environmentally. For the full report, go to: http://www.oecd.org/dataoecd/33/41/39276978.pdf

Endnotes

1. Kari Hamerschlag, Farm Bill - 1 step forward, 3 steps back, San Francisco Chronicle, Open Forum, Friday, July 27, 2007
2. http://www.indybay.org/newsitems/2007/07/27/18437682.php
3. Global Subsidies Initiative. Biofuels: At What Cost? Government Support for Ethanol and Biodiesel in the United States. International Institute for Sustainable 
 Development October 2006.
4. Doombosch, R., and Ronald Steeblik (2007) Biofuels: Is the Curse Worse than the Disease? Round table on Sustainable Development, Office of the General 
 Secretariat, OECD, Rome
5. Overview of U.S. Ethanol Market, Hamza Hasan, Food First/Institute for Food & Development Policy, http://www.foodfirst.org/taxonomy/term/250