Tuesday, April 12, 2011

"Cow Politics" Macro Lessons from the Farm

A little bit outdated but definitely something that is still pressing in the world political economy, and especially for the U.S. Besides, who doesn't love cows?

The editorial goes after the big developed countries and their enormous subsidies they shell out in order to protect their farmers and agricultural industries in general. After all, most developed countries with large chunks of net exports and GDP after all stemming from such business (think the midwest and corn) are looking to keep things the way they are especially as the global economy rebounds from crisis.

In a nutshell these big countries (i.e. Japan, U.S., and the bigger members of the EU) all meet at yearly summits within the W.T.O. in order to discuss both domestic and global issues of trade. Agricultural subsidies in particular, like those to cow farmers, take up large chunks of these government's expenditures and as the article states "Some experts say the developed world could lift 140 million people out of that mire of poverty if it really reformed the way it managed agricultural trade".

Discussions like this one way back in 2005 still go today like i mentioned. But the fact of the matter is, within any of these governments there is room to reduce spending whether it be on subsidies or healthcare bills. Beyond the issues of where or when to reform lay those of how does the creation of wealth from cutting costs get to the hungry third world countries? Moo.

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