IN THE HOUSE ~ Speaking on the Canadian Wheat Board and supply management
November 23rd, 2004 - 10:28pm
38TH PARLIAMENT, 1ST SESSION
Mr. Peter Julian (Burnaby—New Westminster, NDP)
Mr. Speaker, I would like to begin by thanking the hon. member for Montcalm for this motion on such an essential matter. Essential not only for the livelihood of our farmers, but also for the maintenance of an independent food policy, in Quebec as well as in the rest of Canada.
Our system of dairy product supply management as well as the collective marketing of wheat is endangered at the present time. Its life is in danger: first of all, because of the attacks by the World Trade Organization; second, because of the propaganda from the right, for example the Fraser Institute and the lobbyists connected with multinational interests; third, and most important, the lack of resolution and sincerity on the part of the Liberal government.
Let us start with the WTO. Everyone knows that the World Trade Organization, the WTO, which replaced the GATT in 1994, is mandated to promote integral free trade for all international trade, with the corollary being the abolition of any form of subsidy or control mechanisms for agricultural production.
Whereas initially the GATT and then the WTO had set agricultural products aside in a separate category, the tack that has been taken in the negotiations in recent years is a bad sign. From now on, the WTO wants to consider agriculture as a sector just like the others, and to eliminate not only any possibility of subsidy, but also the mechanisms of supply management and collective marketing that are so important to Canada.
In fact, as recently as July 31, 2004, the 147 members of the WTO, Canada included, unanimously agreed on a negotiation framework to allow the resumption of the Doha round of trade negotiations.
The new agreement commits WTO members to the elimination of agricultural export subsidies and targets in the longer run Canadian supply management practices and state trading enterprises such as the Wheat Board.
We know full well that agriculture is not like other sectors and that we cannot leave this key sector in the hands of bureaucrats and WTO officials or the dozen or so multinationals that control the world's food production.
We know full well that a farm producer's job is one of the most difficult and essential jobs there is. Food does not grow on the supermarket shelf. A farmer has to take risks and work very hard in order possibly to earn enough to live on, small compensation for the invaluable service farmers provide to Canadian society.
It is only normal, and we must commend them, that farmers have managed to come together to create such important management mechanisms for the smooth functioning of this key sector and to ensure that their family gets a fair share of the fruits of their labour.
In my opinion, this House has a duty to protect these assets, especially since it is in the public interest to do so.
This brings me to the second threat against our supply management system and single desk selling: the relentless attack of big agribusinesses and those who serve them. Their agenda is to promote bigger profits and the control of larger market shares through the complete deregulation of agriculture. Why else would they want to abolish such a successful system of supply management in the dairy sector, a system which in fact secures a decent income to our farmers without any drain on tax revenues?
Poultry and dairy are two of the few areas in agriculture where farmers make money and can stay in business without being run down by multinationals. Instead of applauding a system that helps us remain standing and keep what is left of our family farms and preserve some of our farming communities, those so-called free marketers, which in fact are looking for a back door to corner the market, allege that Canadians pay more for dairy products than do American consumers. This is hogwash, frankly.
A 2001 OECD report comparing estimates of total consumer and taxpayer support to milk producers in Canada and the U.S. for the period 1998 to 2000 found that they are virtually identical: 58% and 55% of total gross farm gate receipts respectively. Producer support to milk producers throughout all OECD member nations also averaged 58% during that same period. Moreover, for the past decade the dairy farmer of Ontario grocery basket has been cheaper than the American equivalent.
Because the Canadian Wheat Board is a state trading enterprise, it is under constant attack from Canada's trading partners, particularly the United States and the Cairns group, of which ironically Canada is a member. These forces continue to challenge its legitimacy, lobby the WTO and support their friendly lobbyists in Canada to undermine the confidence of Canadians in the Wheat Board.
This brings me to my final point, the third danger to our agricultural marketing system: the apathy and insincerity of the federal government. Although the Liberals made the support of the Canadian Wheat Board and supply management one of their platform planks in the last federal election, the WTO framework of negotiations to which the Liberal government agreed in Doha contains elements that could eventually impact the Canadian Wheat Board's current capacity to market wheat and barley.
For instance, article 18 of the WTO framework calls for the elimination of export credits, export credit guarantees or insurance programs with repayment periods beyond 180 days. The same article also mentions that the following should be eliminated:
Trade distorting practices with respect to exporting STEs (State Trading Enterprises) including eliminating export subsidies provided to or by them, government financing, and the underwriting of losses. The future issue of the future use of monopoly powers will be subject to further negotiation.
While current practices are consistent with current trade obligations, the latter are a priority on the WTO negotiation table. Given that government financing and export credit could be eliminated, it is unclear how the Wheat Board could survive in the long run without vigorous political action. On one hand, the federal government swears allegiance to the Wheat Board and supply management; on the other hand, it signs international agreements that restrict our freedom to choose what is good for our sovereignty and our existence as a nation.
The federal government has overseen crippling grain prices and rising input costs while helping foreign investors through deregulation, NAFTA and the WTO. Under NAFTA the income of farmers in all three countries has declined. How can we trust the government to defend those institutions and walk the talk when the record is a record of broken promises?
We cannot trust what the Liberal government says since it uses its words to disguise its thoughts. We must be vigilant and closely follow its initiatives at the WTO and elsewhere.
Just before I conclude, I would like to read an extract from The New York Times editorial of October 1, 2004: “In Canada, the supply management system estimates demand, coordinates supply, and is profitable for small farmers. It is a non-subsidy way of supporting farmers and does not use tax dollars. The system is under threat from world trade rules. Should Canada be required to dismantle the system in the years to come, it could mean significant reorganization and re-scaling of sectors of the dairy industry and one that may be less secure for small farmers”.
The Wheat Board and supply management is under attack. The motion that has been brought forward by the member of Parliament for Montcalm helps to address that critical issue that has importance not only for rural communities across the country, but also for urban areas that benefit from the contribution rural areas make.
I and the caucus of the NDP strongly support this motion. We hope that it will pass in the House.