Farm Wars EU Grapples with Costs of Subsidizing Agriculture

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Part 2: Public Support for Farm Subsidies Eroding

Voters' opinions of farm subsidies were borne out in the recent elections in the agricultural state of Lower Saxony in northern Germany: Residents tired of the stench of liquid manure and large factory farms summarily voted the pro-farmer Christian Democratic Union (CDU) out of office.

The trend is also reflected in the academic and political worlds. In a declaration published in November 2009, agricultural economists from all over Europe called for agricultural policy to be more strongly oriented toward goals like climate protection and water management. In December 2011, Germany's upper legislative chamber, the Bundesrat, which represents the 16 German states, demanded that the direct payments be "more strongly legitimized by social contributions." The German conference of agriculture ministers also endorsed the fundamentals of the Ciolos proposals.

"It is in the interest of farmers not to further distance themselves from society," says Ciolos, who senses that a phalanx of special interests in agriculture and politics could defeat his reform. At the head of this phalanx is Joachim Rukwied, president of the German Farmers' Association, who has refused to tolerate criticism of his profession and did not respond to SPIEGEL requests for an interview.

Meanwhile in Brussels, people like Albert Dess have been doggedly fighting the proposed revamping of agricultural policy for months. Dess, a veteran member of Germany's conservative Christian Social Union (CSU), is now a member of the European Parliament and rapporteur on the future of the Common Agricultural Policy (CAP). He sets policy for the parliament and, as a rapporteur, negotiates laws with the European Council and the European Commission. Dess was the clear winner in the first round of negotiations in the agricultural committee the week before last.

The majority of members, most of whom are farmers themselves, are watering down Ciolos's plans. If the committee prevails, all that will change is that farmers will have the option of satisfying the environmental requirements in the future -- or not. Nothing will have been accomplished.

Dess, a self-confident farmer from the Upper Palatinate region of Bavaria, says he has absolutely nothing against protecting the environment. In fact, he adds, he feels connected to nature -- as he did when he once stepped down from his tractor "to carry a fawn out of the field." But the things Ciolos wants? Poorly conceived and bureaucratic!

Germany Stands With Farm Lobby

Dess's opponents in Brussels refer to the 65-year-old Bavarian's work as "Dess-information" (disinformation). In fact, Dess is one of the biggest boycotters of the reform and has introduced a potentially record-breaking 8,000 amendments into the parliament. He reportedly even pushed for having the amendments translated into all 22 EU languages. "A lot of work," says Dess, who seems to relish his words.

The CSU politician knows that he enjoys the support of Chancellor Merkel and Agriculture Minister Ilse Aigner (also of the CSU), whose rhetoric has been inconsistent with her actions.

Aigner likes to point out how often she is at odds with farmers. "We support much of what Ciolos proposes," the minister insists. In reality, however, she is doing a number of things to satisfy the wishes of the farmers' lobby. Like the lobby, she misses no opportunity to disparage the reform as a bureaucratic monstrosity. And again echoing the lobby, she characterizes Ciolos's proposal to use 7 percent of arable land in environmentally sound ways as "putting fields out of commission."

Last April, Aigner's ministry unveiled a proposal intended to make "greening" completely voluntary. Her two state secretaries supposedly ensured that a very similar draft was introduced into the European Council, the powerful EU body representing leaders and ministers from the 27 member states, apparently with success. "In addition, there is considerable overlap between the ideas put forth by the European Farmers' Association in November and what is now in the proposals," says WWF official Matthias Meissner.

Berlin already put a stop to a central building block of the reform last year. Ciolos wanted to eliminate direct payments to the largest operations, which can run their farms on their own steam. Aigner claimed that if that happened, the companies would simply divide themselves into smaller entities to qualify for the subsidies again.

"Ironically Germany, which is the largest net payer and usually wants the European Commission to pay special attention to how public money is being spent, is now saying no to the capping of direct payments to large farms," Ciolos says with astonishment.

"Neither Ms. Aigner nor her party allies want a serious reform, because it would harm their own clientele," says Martin Häusling, a Green Party member of the European Parliament. "That's why they are doing everything to continue to support export-oriented agriculture, in which quantity and size are all that matters. What they fail to recognize is that the billions of euros in direct payments have long been unacceptable to the public."

Without Reform, Subsidies Could End Completely

The showdown over agricultural policy will be on the agenda in Brussels in the coming weeks, and not for the first time. But in contrast to past showdowns, this time it will not be dominated solely by the Commission and the leaders of the EU member states. The European Parliament will also be given a say in how the billions in subsidies to farmers are structured. The contest is still seen as undecided, although one thing is clear: If the farming lobby does manage to block the Ciolos reform, a much more unpleasant debate could follow, namely whether the billions in subsidies in the current form are justifiable at all.

"There are actually only two socially acceptable justifications for payments to farmers," says agricultural expert Lutz Ribbe of the European Nature Heritage Fund. One argument, he explains, is that the money can supplement the meager income of farmers, thereby preventing the farming lifestyle in Europe from going extinct. The other is that the farmers can provide vital aid to the environment in return for support from the taxpayer.

But poor income is hardly an issue anymore for farmers. Global market prices have almost doubled since 2005. According to calculations by the government-run Thünen Institute of Rural Studies, larger farms recently made an average annual profit of about €160,000, of which about 40 percent was financed with taxpayer money. Farmers are also increasingly profiting from the boom in alternative energy, as they rake in millions with biogas plants and wind turbines that they operate on the side.

This leaves the environmental services Ciolos is calling for. If they don't materialize, says agricultural expert Ribbe, "there will no longer be any justification for direct payments, and they'll have to be eliminated!" Environmental groups like Friends of the Earth Germany, as well as the Greens, tend to agree. Bärbel Höhn, deputy chair of the Green Party's parliamentary group, says: "It must be clear to farmers that social acceptance for direct payments hinges on 'greening.'"

This explains why EU Commissioner Ciolos has absolutely no intention of giving up the fight. He visited Germany several times last year and spoke to farmers there, he says. "They repeatedly criticized items that aren't even included in the reform." Ciolos says that he was surprised by this "almost ideological opposition to things people haven't even understood."

Ciolos is quite disconcerted by the chancellor's aim to bring up the issue at the EU summit on Thursday and Friday this week. If Merkel actually manages to cut in half the already minimal environmental offset areas on farmland, says Ciolos, it will mean that Germany is doing nothing at all. "We can talk about details, but there are certain red lines, as far as I'm concerned," says Ciolos. "I will not accept a bogus reform."

The commissioner is adamant in defending his views, but other commissioners before him have expressed similar opinions. They are gone now, but defenders of the status quo are still around.

Translated from the German by Christopher Sultan


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moerschen 02/05/2013
1. A Backward step
I'm amazed at this article, Germany has been steadily advancing toward a "Green" contry, and to suddenly decide that making farm lands green is not in the interest of the country is unbelieveable!! Not to mention that small farmers will soon be gone, and what would germany have done without them after the big war? if "bigger is better' take over the farms,seems to me that Germany is going the way of the U.S., in as much, as this is again enforcing laws for Big business, versus the poor farmer. If it goes for Big Business, then I pray for the health of Germans and their children. Because ALL Big business ever cares about is profit, and further growth, not the safety of the people who consume their products. So what happens? The quality of the farm goods decreases rapidly as the companies cut safety, in exchange for gain. That's been the story for years, and will remain as long as big business wins over small groups of people. The food supply of any country must be produced in the future by farmers that respect the users of their product, and adhere to the practice of producing the most healthful products. I have a small farm here in America, and my chicken eggs are extremely healthy, but those I bought before from large Super Markets, were not near up to the standards that I, as a producer set for my product. That's what Germany can expect if the big business wins!
pmoseley 02/07/2013
2. Self interest at work
The EU farm subsidies are the best example of where the EU was set up, and is still run, to serve the interests of Germany and, particularly, France. It is an example of why the EU needs drastic reform, why economic sense has to prevail and where the EU electorate has to have a voice.
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