US Food Aid Rules: If You’re Not Outraged, You’re Not Paying Attention

enoughThe Obama Administration announced yesterday that it wants to change US food aid rules to allow for more “local procurement” of food aid in the countries that need it.  Predictably, the special interests are aghast.  But the administration is right: current food aid rules are among the most egregious special interest legislation in the world right now, preventing this country from stopping starvation, often helping it, wasting taxpayer money, increasing greenhouse gas emissions, and causing soil degradation in Africa.  I have been working on this issue for the last couple of years with the American Jewish World Service, one of the world’s best charities: ending the current rules is a win-win-win-win all around, which is why it will probably be a fight to accomplish it.  The most important source on this issue is Roger Thurow and Scott Kilman’s outstanding book Enough: Why the World’s Poorest Starve In An Age of Plenty.  Run, don’t walk, and go and read it.  But in the meantime, here is what you need to know.

In order to see how egregious current rules are, suppose that there is a famine in Ethiopia (I know, hard to do).  the quickest and most effective thing to do would be to find some farmer or group of farmers in other parts of the country, or in neighboring countries, buy their food and get it to the stricken area.  After all, one key cause of famine is the lack of money, not lack of crops.  But under current law, USAID is basically forbidden from doing that.  Instead, it must buy grain in the United States and ship it several thousand miles to the famine area.  You can imagine the amount of time that that takes; sometimes, several weeks.  it’s a logistic nightmare.  In the meantime, thousands die, usually the weakest such as children and the elderly.

But it’s worse than that.

If the food needs to be shipped, then that means that the shipping must be paid for.  And it sure is: according to a study done by AJWS and Oxfam, nearly 55% of the cost of American international food aid goes not to food, but to shipping costs.  That’s what your tax dollars are going to.

But it’s worse than that.

Just because a ship is flagged American, doesn’t mean that the sailors on it are American.  Hundreds of ships have been flagged under Liberian registry for years, and during much of that time, there was no “Liberia” to speak of.  So your tax dollars are not necessarily going to American jobs, and probably are not.

But it’s worse than that.

Recall, of course, that the food that will be shipped to the famine area is subsidized, so in fact, we are spending food aid money not on people who are starving, but on relatively wealthy American farmers.

But it’s worse than that!

Once the food finally makes its way to the country in question, not all of it gets to the famine area.  Free food from the United States is simply too attractive to smugglers, who siphon it off and then sell it in markets.  I personally have several instances of markets selling food in bags stating quite clearly: “GIFT OF THE PEOPLE OF THE UNITED STATES OF AMERICA: NOT FOR RESALE.”  You can it in markets throughout Africa.  And what that does is put local farmers out of business because they cannot compete with this illegally dumped food from the United States.  in other words, by this sort of dumping, in many instances, we are actually making the problem worse over the long term because we are undermining other countries’ ability to feed themselves.  Ikal Angelei, whom I blogged about several months ago, told me that in her village in Kenya, they used to have enough supplies to last for several months in the event of a famine.  Now, in no small part because of the dumping, the village only has a few days’ worth.  This is not-not-not to say that there should not be food aid, but rather that it needs to be done effectively and efficiently.

But it’s even worse than that!

The inability of local farmers to farm the land means that the topsoil begins to erode.  Native farming techniques were hardly environmentally perfect, and caused damage, but the failure to farm at all often mean environmental degradation.  So when we hear that “Africa Is Dying,” as I did back in 2010, we should know that we are part of the problem.

That’s pretty awful isn’t it?  And the really shocking thing is just how little it gets us.  James Caponiti, the executive director/lobbyist of the American Maritime Congress, claimed in the NYT article that moving to local procurement could cost the United States “hundreds of jobs.”  Hundreds?  That’s what he claims?  Hell, we could end the sequester and write a bigger transit bill and multiply that over several times.  And that’s taking his argument at face value.  One remembers Muhammed Ali’s famous taunt to George Foreman in Kinshasa:  “Is that all you got, George?  Is that it?”

My friend Timi Gerson, AJWS’ advocacy director, is quoted at the end of the article: “From a taxpayers’ and policy perspective, the food aid program is clearly in need of reform. The only thing getting in the way is politics and special interest.”  Absolutely, 1 million percent true.  Call your Congressmember and tell them how important it is to support the administration.

It will be very interesting to see what evangelicals and so-called fiscal conservatives do on this issue.  Very interesting indeed.

Comments

  1. Brett Bellmore says

    I’ll certainly agree that, from an aid to the starving perspective, requiring food aid to originate in the US no matter how distant the recipients makes little sense. Which might suggest that the programs are motivated by something other than a desire to feed the hungry…

    However, as horrible as it might be, governments receiving food aid might actually have reason to prefer that the food originate outside their borders. Prosperous farmers are an independent power center, food aid is typically distributed through government, cementing government power. Famines can be used to destroy political opposition groups, weaken alternate power centers, and generate loyalty to the central government.

    It might be we’re doing it this way because the governments on the receiving end are more cooperative this way. It’s hardly a secret that oppressive government and famine go together. Is this really just bad luck?

    It’s also, it occurs to me, possible that it’s difficult to buy food in famine areas… And that our purchasing it there might bid up the price to make it even harder to come by. It’s a fine line to walk, perhaps, between flooding an area with food and driving the farmers out of business, and buying up all their produce so that nobody local can buy it.

    Just speculating here, this is hardly an area of expertise for me. But, yes, you don’t need to be an expert to know the current rules are loony.

    • Jonathan Zasloff says

      Originally, the rules were developed in the 1950′s to deal with domestic food surpluses. They have since metastasized into what we have now.

      Your point about bidding up prices in famine areas makes sense theoretically: Cornell University did a study on that a couple of years ago and found that it did not. That was one of the standard arguments, but it was essentially special interest obfuscation.

      • brendan says

        Right. and the recommendation is not to buy food down the road from the starvation anyway–there likely is little there. the recommendation is to avoid making an intercontinental boondoggle of it. when there is famine in ethiopia (to stay with that example), the entirety of south and north africa might be otherwise, or at the furthest, the middle east. Or like that–we don’t have to try to feed ethiopia from nebraska for heaven’s sake.

    • MobiusKlein says

      Quibble: programs do not have a single motivation. The sponsors often have many divergent motives. If only the fiscal conservatives were to vote to fix this problem (other than to end the funding, that is. Which suggests they have motives other than spending money wisely…)

      • Brett Bellmore says

        Now, if fiscal conservatives were to vote to end the program, they WOULD be voting to spend money wisely. On the principle that government should not be duplicating the private sector, and the private sector already does charity, and without this sort of loony rule, to boot.

        • Kellandros says

          2 quick rejoinders- the public and private sector overlap on a large number of purposes. Few things are considered entirely in the public sector or entirely in the private sector.

          And ‘duplication’ suggests redundancy or 2 groups/businesses fighting for the same, well, market share. First, since there is still plenty of hunger out there (in the US even) it hardly seems that private or public charity has flooded the market beyond what it can bear.

          Just as much as very few people (outside Microsoft) would concede that since they have a pretty good and popular operating system, there is no need for any other (it would only cause confusion and wasted effort keeping hardware and software running on multiple platforms).


          Second, what makes you think private charities don’t make the same mistakes or loony rules? Just look at food banks- private groups like to organize canned good drives. Then the food bank has to collect and sort and check for expired items, and then ship them off to where they are needed. And that won’t cover the whole range of foods people need- what is donated is likely the oldest stuff people have or the things bought and never ended up wanting to eat.

          Food banks can buy from manufacturers in bulk much much cheaper than consumers:
          http://www.mnn.com/money/sustainable-business-practices/blogs/cash-is-better-than-cans-at-food-banks


          Or there were some church groups trying to gather donations of shoes for Haiti. People would be able to get rid of their cast-offs and feel good about helping someone else. But it costs much more to ship those shoes overseas than just sending cash. And there are people who have a livelihood making shoes already there, who need to feed their families and to rebuild; now that the area is flooded with all these free shoes who is going to buy theirs?
          http://aidwatchers.com/2010/01/nobody-wants-your-old-shoes-how-not-to-help-in-haiti/

          ======
          The main difference in public vs. private charity is accountability. Very few people get to see the books for these charitable organizations, but government spending is public record and can be viewed, tracked, and complained about. Just make sure the complaints are used to improve things, not just as cause to give up on something needed.

          • J.m.g. says

            Actually, all the charities have to file their tax returns (990s) which are posted on the interwebs for all to see. Check out guide star.org sometime.

        • MobiusKlein says

          Show me the votes.

          If the self styled fiscal conservatives vote against an amendment to remove the US only rule, they prove themselves frauds.

    • Cranky Observer says

      = = = I’ll certainly agree that, from an aid to the starving perspective, requiring food aid to originate in the US no matter how distant the recipients makes little sense. Which might suggest that the programs are motivated by something other than a desire to feed the hungry… = = =

      As MobiusKlein rightly states there are multiple factors in such a program, but certainly pumping more federal dollars into the net taking rural states (Kansas, Montana, etc) is one of them.

      Cranky

    • NCG says

      Shoot. I was just about to say, how great is it that for once, we *all agree* that feeding starving people is a good thing for government to do. Darn it. Shoulda known better.

      • says

        What, and fail to prostrate yourself to the almighty Miraculous Markets God, who reigns supreme everywhere and all times for all people, thwarted only by the Devil Government’s trickery.

  2. byomtov says

    …it must buy grain in the United States and ship it several thousand miles to the famine area.

    Wonder why that is? Another case of federalism at work, perhaps?

    • Jonathan Zasloff says

      Very true. That is done mostly by a practice called “monetization,” which the administration is also trying to end. Instead of just giving money to NGOs for them to do their work, the government gives the NGOs subsidized food, which the NGOs are supposed to sell in order to fund their programs. So basically the practice gets NGOs to do the dirty work of selling subsidized food and makes their programs dependent upon farm subsidies. It’s very much a racket, as you say.

      • Brett Bellmore says

        OTOH, direct financial aid to NGO’s is likely to be easier to launder back to the politicians providing it. Bug or feature? With government, essentially everything is a racket, you merely hope that it’s something useful in addition to being a racket.

        • brendan says

          “With government, essentially everything is a racket, you merely hope that it’s something useful in addition to being a racket.”
          and with the private sector, everything is for profit, you merely hope that something useful is produced in addition to profit.
          these are simplistic and ultimately stupid statements. the private and public sectors have much to offer in most fields, and it must be said that in the area of delivering nutrition to the very poor or the famine-struck, it is almost always a case of drastic market failure we are dealing with. (yes, i included drought and so on—private businesses have no business trying to cope with such natural disasters and dont, generally, even try. it turns out to be left to government and ngos–which is alright, that’s what they’re for)

  3. CharlesWT says

    Investments from China will do Africa more good than aid from western countries.

    • brendan says

      they have haven’t done so far. the chinese practices in Africa so far have done as little for the local population as did western colonialism. although so far they have avoided outright slaving, we have to give them that.

  4. says

    Substitute funds for food, and you basically have the problem with the current nation-building/post-conflict reconstruction model adopted by the U.S. and most of the West. Not enough investment in local economic structures and instead the U.S. and others make developing countries dependent upon external aid (Dambisa Moyo and William Easterly do a good job of explaining the problem with western aid, Africa in particular). Best part of this; most of the programs/projects undertaken to “help” developing countries are violative of economic rights under international law.

  5. James Wimberley says

    A startup American aid NGO called GiveDirectly is trying a model of direct cash transfers to very poor African families. The mechanism is mobile phone transfers, so GiveDirectly for now only works in Kenya, one of the few countries where this service is currently offered. Wish them luck and send them some money.

  6. paul says

    This isn’t just food aid, it’s pretty much any bilateral aid. And it’s been a much-talked-about problem for at least 25 years. Oh, and it’s even worse: I don’t know about food aid in particular, but in other areas of endeavor the priorities for what to do tend to be not so much about the recipients’ needs as about the desires of well-connected organizations in the donor country. So US taxpayers fork out to have a US company (well, nominally US) build a bridge or a chemical plant or a steel mill or whatever in some other country, with graft of some kind to gatekeepers there, and whether they’re in a position to use it or not. In fact, better not, because then you would affect international markets and wouldn’t get the chance to do it again. So “foreign aid” of this sort turns out to be the most inefficient kind of “dig holes and fill them” economic stimulus.

    Oh, and don’t get me started on foreign military “sales” and offsets (where the US agrees to buy goods and services from the recipient country in amounts sometimes exceeding the list price of the weapons whose sale it just subsidized).

  7. Chris says

    Have you ever thought that the food aid helps “subsidize” the agricultural industry along with other industries? You want to stop millions of bushels of corn from being bought by the US and exported for aid? You want to see a bubble burst, go ahead with your plan. Good or bad, you just can stop a farm subsidy of this magnitude. Thousands of family farmers and corporate farms would go chapter 7 and your food prices would soar. If you want free market for food aid, then you should be in favor of free markets for schools, health insurance and all the other areas the government is in. Besides, we are going to give billions of dollars to some of the poorest governments to feed their people? You have to be kidding.

Trackbacks

  1. [...] US Food Aid Rules: If You Are Not Outraged, You Are Not Paying Attention – an overview of the cost in lives and money 0f existing rules that require food used for international aid be purchased from US agribusiness, rather than from places close to where the food aid is needed.  President Obama’s upcoming budget proposal is expected to include efforts to reform that system. [...]

  2. [...] US Food Aid Rules: If You Are Not Outraged, You Are Not Paying Attention – an overview of the cost in lives and money 0f existing rules that require food used for international aid be purchased from US agribusiness, rather than from places close to where the food aid is needed. President Obama’s upcoming budget proposal is expected to include efforts to reform that system. [...]