Food Fight! Congress Blocks Obama Plan to Shift Aid Dollars Abroad

Photographer: George Osodi/AP Photo

Local villagers work on their cocoa farm in Abo village near Ikom, Nigeria. Close

Local villagers work on their cocoa farm in Abo village near Ikom, Nigeria.

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Photographer: George Osodi/AP Photo

Local villagers work on their cocoa farm in Abo village near Ikom, Nigeria.

Bipartisan agreement is so rare in Washington these days that no common ground, however plain, should escape notice: It turns out that both Republicans and Democrats believe that food aid for international emergencies should feed people.

The splits -- which cross partisan boundaries and in the last decade has pit lawmakers against presidents who share their party -- arise over the question of who should the United States buy the food from? Should the U.S. pay its farmers and ship their food overseas, the traditional plan, or should it ship money overseas and pay poorer farmers abroad, as every other major food-producing nation does?

The sums involved are relatively inconsequential for U.S. agriculture -- less than $2 billion out of a sector that this year may see a record $128 billion in profit.

It’s not inconsequential for farmers in developing countries who are trying to scale up production.

Another thing that’s not inconsequential: The amount of time and money the U.S. spends on diplomacy, intelligence and military efforts to understand and quell nations destabilized by food insecurity. Think Egypt in 2011, where bread prices directly tracked Arab Spring unrest, or Afghanistan, where some of the world’s most crushing poverty continue to feed support for the Taliban.

“If you get into a situation in which African countries can’t feed themselves, and you have a situation where people can’t get jobs, then you don’t have food security, and the U.S. spends a lot of money handling these situations,” said Nigeria’s Minister of Agriculture and Rural Development, Akinwnumi Adesina, in an interview last week. His agency oversees farming in the world’s seventh most-populous country.

The Obama administration wants to reshape U.S. policy to address concerns like Adesina’s. It proposed in April an overhaul of its food-aid programs -- some of which date back to the Eisenhower era -- to limit purchases from U.S. farmers. Such a change would save time and money by reducing shipping distances and costs; it would also build markets for developing-world farmers, ending reliance on foreign aid, the White House says.

The plan would shift almost all of the $2 billion from the U.S. Department of Agriculture, which runs the U.S. commodities-aid program, to the U.S. Agency for International Development, which focuses on overseas projects. The Obama proposal builds upon calls dating to the George W. Bush White House to shift food aid toward buying more in developing countries.

Obama is reassuring farmers and shippers that their cupboards won’t be bare: Shippers will get a subsidy to make up for some lost business, and for at least the first year, 55 percent of food aid dollars will still go toward programs run the old way.

The plan, like Bush’s less-ambitious attempts that ultimately stalled, has run into resistance in Congress, where legislators protecting farmers and shippers have balked at revamping programs that aid domestic exports.

A Senate amendment to a five-year farm bill likely to be approved today would boost food aid overseas to $60 million a year from $40 million -- extra crumbs for local purchase, but less than one-tenth of what the White House would spend. It would leave the traditional “buy U.S.” policy largely in place.

A House of Representatives committee last week rejected the White House policy altogether. “These are American taxpayer dollars, and I think these dollars ought to be spent in America on American products,” said Senator Mark Pryor of Arkansas, chairman of the agriculture appropriations committee, in a hearing last month. Supporters of the new approach point out that as U.S. farm exports have boomed, food aid has become a tiny component: About 1 percent overall.

To Nigeria’s Adesina, who has a doctorate in economics from Purdue University in Lafayette, Indiana, a change would help African economies transition away from dependence on food imports, toward greater self-sufficiency.

Boosting food aid bought from African farmers “helps create markets. The benefits for Africa are quite huge,” he said.

Analysis and commentary on The Grid are the views of the author and don't necessarily reflect the views of Bloomberg News.

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