We all know that farm subsidies support the agricultural industry in the U.S.. But what does this do to other countries? The article "Punch-up over handouts" explains who benefits from agricultural subsidies and who it hurts. The author explains that 33 of the 49 poorest countries import more farm goods than they export. If subsidies were extinguished, then these countries would pay a higher price for their imports. Most of these countries already receive aid from other countries, which would just transfer the burden to the aiding country. Other countries, however, would benefit from freer agricultural trade. Brazil and Argentina are already strong agricultural exporters and would gain more from freer trade, while the rest of Latin America would lose approximately $559 million a year. In a world of increasing competition, I believe we should eliminate subsidies and let the market decide who can offer agricultural products at the lowest price. Every country has a comparative advantage in something, let them figure out what it is instead of bailing them out.
Posted by rico at 3/30/2005 12:56:00 PM