COLUMN ONE : Europe’s Fearful Farmers : The United States wants their subsidies slashed. But farmers are fighting back, relying on the public’s love of the countryside and memories of food shortages after WWII.
Alexis Semaille, 28, represents the future of European farming. No wonder he’s so glum.
With his father and his wife, he works seven days a week growing sugar beets and pastry-grade wheat and raising 200 head of dairy and beef cattle. It’s hard work, and Semaille needs a helping hand.
The helping hand is stuffed with cash--$100 billion in subsidies for Semaille and other European farmers every year. Europe has been whittling away at those subsidies since 1985, when mountains of unsalable food accumulated in storehouses.
Starting today, after four years of negotiations, trade officials from 108 nations will meet in Brussels to consider much sharper reductions. The United States, under the banner of fair trade, wants to dismantle the subsidy system altogether.
Instead, European farmers like Semaille may dismantle the trade talks. “For me,” he says, “subsidies have already been cut about as far as they can be.”
If the 12-nation European Community refuses to cave in to American demands, as it has so far, there may be no trade agreement at all. The European farmer, as cherished as the family farmer is in America, would emerge victorious. The European farm system, notorious for excess and fraud, would remain intact.
As in the United States, the farmer has acquired a mythic quality in Europe. Without him, it is believed, the Continent might not be able to feed itself and its countryside would disappear.
And as in the United States, the farmer knows how to use his image to political advantage. At a recent protest rally of cattle farmers in the French town of Nevers, a demonstrator’s banner read, “ Pas de Paysans, Pas de Paysage .” No farmers, no countryside.
For all their similarities, the European farmer and the American farmer don’t see things quite the same way. Americans see the Europeans keeping U.S. products out of their market and subsidizing exports to the United States. Europeans see an assault on their turf by the rich American farmer.
“To Europeans,” says Chris Horseman, analyst for the London consulting firm Agra Europe, “Southfork (in the television show ‘Dallas’) is the typical American farm, and the typical farmer drives a Land Rover over his vast domain. The perception is that America wants to drive prices lower so that their farmers can survive but ours can’t. And nobody wants to be clubbed into submission by the Americans.”
Europeans’ affection for their farmers is part sentimentality and part survival instinct.
Many remember the food shortages and rationing of World War II and its aftermath. “I remember the black bread, which was sometimes all there was to buy,” says Jacqueline Maelcamp, a Brussels housewife who was only 10 years old when the war ended. “It was made from an awful mixture of straw and very little flour.”
So in the late 1950s, shortly after it was formed, the European Community developed today’s program of price guarantees for farmers, not so much to enrich them as to ensure that Europe would always be able to feed itself.
Europe’s farmers can now produce far more than its people can eat. “Agricultural production is increasing at an annual rate of 2% while food consumption is growing only 0.5% to 1%,” says Albert Ledent, an economist at Belgium’s University of Gembloux.
Emile Bossicart, 76 and still raising cattle in southern Belgium, says 85 acres of grazing land supported 40 head of cattle 30 years ago. Now, thanks to modern fertilizer, 80 to 100 head can live on that same land.
Europe developed the ability to feed itself as early as 1975. “That would have been the time to begin scaling back aid to farmers,” Horseman says. “But farmers had come to expect high prices, and many politicians knew they owed their jobs to the farmers.”
Not until the mid-1980s, when unwanted food was stockpiled to mountainous proportions, did the European Community begin paying farmers not to use some of their land or to reduce their production of particular crops. Pensions were offered to those who retired early. Farmers in some areas were paid to plant trees instead of crops or to develop bird and wildlife refuges.
But when prices guaranteed to farmers for their produce were scaled back, farmers turned angry. “After the war,” Semaille says, “our first concern was feeding ourselves. We have built our agriculture to be productive. And now they want to destroy it.”
Productive though it is, Europe’s farm system is also famous for its fraud and abuse. At a German port, for example, shippers collect thousands of dollars in export subsidies simply by loading tons of wheat onto one side of a Soviet ship and then immediately unloading it from the other side.
And yet, the European farmer has maintained political clout and popular support.
Agriculture accounts for nearly 8% of employment in the dozen EC countries, compared with 3% in the United States. Farmers are proprietors of three-fourths of the Continent’s land. They are highly organized and inclined toward violent demonstrations that get the attention of politicians.
Thousands of farmers plan to descend on Brussels for the final week of the trade talks. Over protests from the United States, French Agriculture Minister Louis Mermaz encouraged the farmers’ rally, which he said would help the EC negotiators resist deep cuts in farm programs.
Also, Europeans equate the prosperity of the farm economy with the beauty and charm of the countryside. Most Europeans feel they have a stake in preserving rural areas for weekends and vacations.
The family of Yves Blondel, an executive with the Banque de France in Paris, about 20 years ago bought and renovated an old farmhouse in Bonnieres, 60 miles from the city, and now they spend at least two weekends a month there.
“The greatest pleasure we get from owning this second home is being able to enjoy the countryside, to rest in the peacefulness,” says Helene Blondel. “The charm of our surroundings lies in the farming scenery.”
Farming in Europe faces the same challenges it does in other industrialized countries. The life isn’t easy, and opportunities and interests beckon youth to the cities.
More than half of Europe’s farmers are 55 or older, and more than half of those elderly farmers have no relative waiting to take over their property.
Michel Domange, who raises cattle on 170 acres of hilly land near the northern French town of Avioth, finds himself in that predicament. Domange’s three sons, all in their early 20s, have found other professions--a joiner, an electrician and a bricklayer.
“None of them wants to take the farm,” laments the 52-year-old Domange. “They are all disgusted. This is tough work--cows have to be milked twice a day, 365 days a year--and young people don’t like to do it nowadays.”
The Semaille farm--a 200-acre spread called A Dieu Seul (To God Alone)--has been in the family only since 1953, although earlier generations farmed other land nearby. The main farmhouse, a solid, two-story stone structure dating to 1764, is chockablock with antique furniture, and the floor is of decorative tiles.
The farming equipment is more modern. The computerized milking barn, which can manage 12 cows at a time, keeps track of each animal’s production and health.
But Semaille wonders whether he can remain on the farm for as long as his father, who is now 59. He sank about $200,000 into the farm this year for everything from fertilizer to rent on the 150 acres that the Semailles do not own. He expects to get the $200,000 back, but not much more.
“I could earn almost as much on unemployment,” he says. He figures he could do better as an agricultural engineer--he has a college degree in that field--but he has the farmer’s typical disdain for indoor work.
Semaille’s demanding lifestyle--get up every morning at 5:30 and work until 8 at night, with an hour off for breakfast and another for lunch--does not appeal to everyone of his generation. But, as long as the subsidies remain, he is determined to stay.
The farm subsidy system that supports Semaille and Europe’s 9 million other farmers differs from the U.S. system. In the main, the United States props up prices by getting farmers to produce less; Europe generally encourages farmers to produce more, although it also imposes an elaborate quota system on production of milk, sugar and some other products.
The basic mechanism is a guaranteed price--always substantially higher than the going rate on world markets--that the EC sets every year. If farmers cannot find mills willing to pay the guaranteed price for their wheat, for example, they can sell it to the EC. The United States uses this system in some instances, as well.
European farmers also can sell their goods abroad. The refiner that buys Semaille’s sugar beets sells all its sugar overseas, for less than the guaranteed price in Europe. The EC pays the refiner the difference.
London analyst Horseman calls the export subsidies “a political cosmetic. It sounds better to say you’re selling 20,000 tons of wheat to Saudi Arabia than to say you’re letting 20,000 tons of wheat rot in warehouses.”
It doesn’t sound better to the United States. Agriculture Secretary Clayton K. Yeutter says the EC is simply “buying markets” for its farmers.
The European system is nothing if not costly--about half again as costly as the extensive U.S. program of agricultural supports. Last year, according to the Paris-based Organization for Economic Cooperation and Development, the EC spent $44 billion of its own money, and artificially high prices cost European consumers another $54 billion. In effect, Europeans paid a hidden food tax of 31%, compared with a 15% hidden tax in the United States.
Slowly, even before the international trade talks forced its hand, Europe began chopping back the farm subsidy program. The most promising measures, so far in force only in Britain, Germany, Denmark and the Netherlands, offer payments to farmers in “environmentally sensitive areas” who maintain or improve desirable aspects of the countryside.
“Europe’s farmers have convinced the public that continued agricultural subsidies are essential for maintaining the countryside,” says Stefan Tangermann, agricultural economist at the University of Goettingen in Germany. But Europe, he says, can pay farmers to maintain their land as forests or bird and wildlife refuges or other environmentally attractive alternatives.
Mungo Bryson’s farm in the rolling countryside near Parton in southern Scotland is a pioneer in the community’s effort to redirect the subsidies. The EC is paying Bryson $9,000 a year for environmental improvements, provided that he does not increase the number of sheep and cattle that graze on his 750 acres.
Those improvements include rebuilding the dilapidated stone walls that were built 80 to 100 years ago to separate one property from another. The walls, says Paul Rusby, who has worked on the farm for seven years, are a strong tourist attraction.
“There are miles and miles of them,” he says, “and they are big--two feet thick at the base, a foot and a half at the top and about five feet high.”
Bryson says he has also fenced off 20 acres of wetlands to keep the sheep and cattle out. Elsewhere on his spread, he has planted oak, sycamore and other hardwood trees. Bryson’s sheep and cattle farm, more than Semaille’s more productive acreage in Belgium, may represent the real future of European agriculture.
The Council of the EC, the group’s decision-making body, is considering a proposal to expand the existing program by broadening the scope of activities it finances and requiring that all 12 EC nations make it available to farmers who choose to participate.
“The role of agriculture is not only to produce food,” the EC Commission said in presenting the plan. “Agriculture also plays an increasingly important role as the main manager of the countryside and in conserving the environment.”
AN OCEAN APART
A comparison of farming in the United States and the 12 nations of the European Community.
United States European Community Number of farmers (1987) 3.4 million 9.7 million As a share of all workers 3.0% 7.8% Government subsidies to farmers (1989) $46 billion $44 billion Consumer subsidies to farmers (1989) $22 billion $54 billion Agricultural trade balance +$7 billion -$15 billion Total agricultural production (1987) $76 billion $72 billion As a share of total economy 1.8% 2.7% Number of farms (1989) 2.2 million 6.9 million (1987) Decrease since 1980 11% 8% Average farm size (1989) 200 acres 41 acres (1987) Increase since 1980 4% 8%
Source: Organization for Economic Cooperation and Development, U.S. Agriculture Department, Commission of the EC