Same Old, Same Old Is Not What Is Needed Now

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It borders on reckless stupidity for any government to actually consider dismantling a system that has seen poultry and dairy production being the most stable and most profitable sector of Canadian agriculture for the past 40 years.

Recently the Western Centre for Economic Research, a think tank at the University of Alberta, released a document entitled, “Alberta Agriculture and Food Trade: Recent Trends” by Dr. Joe Rosario.

Dr. Rosario was a senior trade policy analyst with the Alberta Department of Agriculture for many years and it could be said his perspectives influenced a generation of government agriculture trade policies, and in some cases defended political and ideological government trade decisions.

The document notes that much progress has been made over the past 30 years in Alberta. Essentially the author determines, from his observations on that progress, that more of the same is needed. That’s not surprising considering Dr. Rosario was instrumental in creating the policy framework that guided the government’s involvement with increasing agricultural production. There is of course the contrarian perspective that with market incentives, increased production would have increased anyway, despite the government’s or Dr. Rosario’s influence.

The minister of agriculture and senior department officials will no doubt be pleased with this document as it confirms their own perspectives on the direction of agriculture in this province. That’s unfortunate because in my view that paralyzes out-of-the-box thinking and just entrenches ideologically based (and yes, stubborn) positions on issues.

Case in point is the document’s assertion that supply management is a barrier to further expansion in the poultry and dairy industries. This reflects the government position which is not all that supportive of supply management. The idea being that if supply management were eliminated, production and trade would increase. A noble concept indeed except given the present state of the cattle and hog industries in Alberta and elsewhere, any examples of such unfettered expansion and trade have just allowed more people to lose more money.

It borders on reckless stupidity for any government to actually consider dismantling a system that has seen poultry and dairy production being the most stable and most profitable sector of Canadian agriculture for the past 40 years. Dr. Rosario by continuing to support abandonment appears to be in state of denial on that topic.

The document also repeats that old Alberta government mantra about the need to remove the export powers of the Canadian Wheat Board (CWB). Again it is part of a ideological approach against marketing boards of any kind. Copious volumes have been written for and against the value of the board, but I fail to see where its elimination will guarantee any more money in a grain grower’s pocket.

I recall the debate over the ending of the old Crow Rate, which was supposed to usher in a new age of expansion and diversification in value-added production particularly in livestock production. One might say that decision saw the rapid expansion of the hog industry which is now on the verge of collapse. We also see the minute Canadian feed grains are at a premium against U.S. corn, trainfulls of corn arrive in Alberta feedlots the next day. So what exactly was gained from that decision?

My point is eliminating the CWB is not exactly a panacea for more markets and better prices if history is any indication. Dr. Rosario only paints a rosy picture of more markets. I would suggest convenient droughts in other grain-growing areas usually have more market impact than any theoretical hope of more free trade.

Dr. Rosario provides an extensive list of recommendations in his executive summary. His report ignores the dark side of agricultural expansion in this province – low prices, social upheaval in the countryside, restricted marketing. He states that if only WTO agreements could be reached to open up new markets all will be solved, ignoring that those markets are usually subject to fierce competition and ongoing non-tariff trade barriers. There is a certain naivete or delusion in such a free-trade hope.

With all due respect to the report and Dr. Rosario, I had hoped to read something that recognized that all is not well with agriculture in this province and that he had some ideas to address structural weaknesses with certain commodities. Something better and more is needed. I expect this document will soon be gathering dust. Too bad it could have been a real catalyst to a change in thinking on agriculture policy in this province.

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