WTO Dispatches from Hong Kong, Continued

AlterNet staff writer Joshua Holland is reporting from Hong Kong on the World Trade Organization Sixth Ministerial Conference. His dispatches of events from the protests and trade negotiations will be updated throughout the week.

You can read Joshua Holland's most recent entries here.

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Cultivating an Impasse on Agriculture

Updated -- December 15, 5:13 pm PST

The big issue -- and the issue that threatens the 6th WTO Ministerial meet most prominently -- continues to be agriculture.

While U.S. Trade Representative Rob Portman is in Hong Kong defending the United States' against continued criticism, an unfortunate bit of timing back in DC may undermine his position: the House and Senate may announce as soon as today a budget reconciliation package that would extend the commodity subsidies in the U.S. Farm Bill through 2011.

The Senate version contains the extension, authored by Saxby Chambliss (R-GA). Chambliss has said, "U.S. food and farm policy won't be decided in Hong Kong."

His bill would extend only the price supports that distort world crop prices and hurt the livelihoods of poor nations' farmers. The rest of the farm bill includes anti-hunger provisions- food stamps are a part of the bill -- money for environmental protections, support for low-intensity farming and other areas. These would all be allowed to expire as scheduled in 2007.

Members of the NGO community slammed the provision, which insiders expect to survive in the final budget. Gawain Kripke of OxFam U.S. said it was indicative of a "troubling disconnect" between Congress and the Trade Representative -- a member of the president's Cabinet. He said that the Farm Bill has provisions for "haves and have nots" and this would "give a free pass to the haves." David Waskow of Friends of the Earth said, "Congress is balancing the budget on the backs of the poor and the environment" -- pretty much in keeping with this Congress's governing philosophy.

The farm bill is currently set to expire at the same time as the Doha "development round" -- in which the development needs of poor countries is supposed to take center stage -- is scheduled to be completed. That would have lined up nicely for some much-needed ag reform. Sophia Murphy of the Institute for Agricultural Trade Policy said if the provision makes it into the final budget it will "change the whole political calculus."

The United States has been in violation of some agricultural provisions since the completion of the Uruguay Round in 1994. It lost a case brought by Brazil challenging its cotton subsidies -- $4billion dollars worth for 25,000 farmers -- in 2004. It lost a subsequent appeal, but has not cut the subsidies, which are among the provisions extended under Chambliss' bill.

The United States and EU (then EC) have promised to address crop subsidies since the 1950s, but haven't gotten around to it yet. Readers should keep that in mind when they peruse the next Wall Street Journal editorial lambasting the developing countries for creating an impasse. Emily Byers, with the U.S. faith-based lobbying group Bread for the World, said plainly that the United States has a "rogue" crop policy. The EU may be even worse.

In a press conference of leading G-20 members, Brazil's Trade Minister said yesterday that "it is clear these issues are not going to be resolved now," and the Argentinean Minister affirmed what everyone knows: "Agriculture has to be the first domino to fall" if a deal is to be made. The Indian Minister said, "There have been too many statements of good intention. At the end of the day they have to yield some results."

The Ministers said that some progress had been made on one kind of agricultural subsidy, but they remained pessimistic that the large services-dominated economies would give enough to the group of agricultural producers to complete a deal. The movement was on one of the easiest points of negotiation -- changing "at a date to be determined" in one paragraph to a date ... that's been determined -- for the expiration of crop export subsidies. Those are the subsidies that everyone agrees are "market-distorting." Brazil's Minister said subsidies in general are the "big elephant in the room." Of a potential deadlock on the least controversial issue, he asked: "if we can't deal with the mouse how can we hope to deal with the elephant?"