Everything It Appears To Be?

The revelation yesterday that the EU was planning to offer to eliminate its agricultural export subsidies in an attempt to revive progress in the Doha world-trade round may not be all it appears to be. Astute readers of my post yesterday on China’s global impact may have noted the following:

“In the first place the Common Agricultural Policy, whose funds have long been directed to supporting farmers from prices which were considered to be too low, may find them increasingly committed towards protecting urban consumers from the consequences of world foodstuff prices which are considered to be too high. In the process the whole debate about farm subsidies may take a new and unexpected turn”.

Believe it or not I actually wrote this before the announcement. If this is right, the new and unexpected turn is not a matter of generousity, but of a changed reality (like half-empty grain silos across the planet). Cancelling subsidies may be no great sacrifice since there may not be too many to cancel: the CAP fund allocation can be eaten-up keeping the price of bread and other staples down.

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About Edward Hugh

Edward 'the bonobo is a Catalan economist of British extraction. After being born, brought-up and educated in the United Kingdom, Edward subsequently settled in Barcelona where he has now lived for over 15 years. As a consequence Edward considers himself to be "Catalan by adoption". He has also to some extent been "adopted by Catalonia", since throughout the current economic crisis he has been a constant voice on TV, radio and in the press arguing in favor of the need for some kind of internal devaluation if Spain wants to stay inside the Euro. By inclination he is a macro economist, but his obsession with trying to understand the economic impact of demographic changes has often taken him far from home, off and away from the more tranquil and placid pastures of the dismal science, into the bracken and thicket of demography, anthropology, biology, sociology and systems theory. All of which has lead him to ask himself whether Thomas Wolfe was not in fact right when he asserted that the fact of the matter is "you can never go home again".

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