Ever since President Dwight Eisenhower promoted Public Law 480 because of his knowledge of starving nations after World War II, the US farmer has strongly supported food aid programs. One primary reason is that the USDA bought surplus grain and donated it abroad, reducing the surplus and bolstering the price. With very little surplus grain, are you still in strong support of PL-480 and seven other food aid programs included in the USDA budget?

Food aid programs are part of the trade section in the Farm Bill and are designed to provide food to the hungry, help develop foreign markets, and dispose of surplus. And any food that is shipped abroad must go on US ships, hence the familiar term “cargo preference.” In the 2006 agricultural appropriations, the programs existed but were not funded. When Farm Bills changed to a market oriented policy, the US was no longer generating surpluses.

Food Aid and Farm Bill issues are explored by Purdue economist Philip Abbott, who says the trade fuss with the European Union about its export subsidies has impacted US food donation programs, and both are lumped together in the current WTO debate. While the US might tend to be generous and ship food abroad, critics advocate a cash handout as being more efficient than food aid. The critics won the argument in the WTO and now donations are to be made in cash rather than food, and in grants, rather than loans.

Another problem is the counter cyclical nature of food aid issues. When recipient countries need food aid, there is less available and the short supply drives up the cost of the food, making world prices and import costs high. When food prices are lower, that implies abundance, and fewer countries need any food aid.

USDA recently celebrated the 50th anniversary of PL 480, but in its proposal for a new Farm Bill, Abbott says there is only one modest proposal related to food aid, and is the USDA approach to walking a narrow line between the WTO rules, and typical American generosity. Even the non-governmental organizations that hand out food around the world understand the controversy, as well as the inefficiency of trying to distribute food into war zones and into despotic countries where warlords control the populace with food.

In your job as the greatest food producer the world has ever known, how much of agriculture should be devoted to giving away food to the hungry? Should a trade war with Europe be started because of our desire to feed the world? Should strained tax resources be strained further to buy food from the market and pay the 60¢ that it takes to ship $1 of food abroad? Can you identify surpluses in the marketplace that could easily be transferred to the hungry? Is it better for those hungry folks to have a bag of US grain, or a meal within their cultural needs that might be paid for with a donation of US cash?

Rural America has know about PL 480 for 50 years, and has taken pride in its philosophy, but probably never kept up with what it did from year to year, and may be surprised it is nearly dormant. If you were faced with $1.50 corn and $5 soybeans, and burdensome grain supplies, would your generosity be stronger than it is now with a demand-driven market and negligible surpluses?

Summary:
The majority of the USDA budget helps the hungry, but those are US folks, and our foreign food aid programs have languished in the wake of insufficient funding and international trade politics. One of the reasons for international food aid programs was the US desire to ship our surpluses abroad, but with expensive shipping costs, and now farm policies designed to eliminate surpluses, food aid programs have declined in priority and importance.