Thursday, April 23, 2009

Food Aid Bill is Passed by Obama: Will it do any good?

As the world is struggling economically through this recession, poor undeveloped countries are becoming more desperate. During this recession, there has been a significant increase in the number of hungry around the world. These countries, many of which are in Africa, are continually becoming less developed as a result of the general public becoming poorer. Contrary to what much of the world thinks, Africa is a continent that is plentiful in food. Food accessibility, however, is the real issue at hand. Trying to get food to those who have no way to pay for it is the problem many African countries have at hand today.
President Obama spoke in London recently at the G-20 summit stating that the U.S. government would double its support for agricultural development in poor countries to $1 billion from $500 million by the end of next year since the US, being a wealthy country, has a commitment to help other countries in need, especially during this time of crisis. This commitment will be fulfilled from the passage of the Global Food Security Act, also known as Lugar’s Bill. This bill was sponsored by numerous political figures including Richard Durbin of Illinois, John Kerry of Massachusetts, Tom Harkin of Iowa, chairman of the Senate Committee on Agriculture, Nutrition and Forestry, and Robert Casey of Pennsylvania and Susan Collins of Maine. The bill would create a special coordinator position to protect global food security in the president’s office. The person holding this position will be to manage U.S. government collaborations with international organizations, non-governmental organizations, and world financial institutions. A new emergency food assistance fund will be created as a result of the bill under the administration of USAID. The fund would operate separately from prior foreign funding and would not affect the prior bills for foreign funding. This new fund is authorized up to $500 million and may be used for local and regional purchase depending on the outbreaks of food shortages.
While this seems like a positive move President Obama is making with his presidency, there is much controversy over going this action to relieve world hunger. Many non-governmental organizations advocate a transition to cash-only food assistance instead of the traditional in-kind contributions, where a mix of food aid and cash are given to foreign countries in need. There are also many others who feel that the U.S. should participate in an aid program of only food donations for the reason that the U.S. will become less willing to give as much cash to dependent country over time as this country is also facing a recession.
The proposed Lugar bill will incorporate both types of aid: food donations and cash aid. This amount of combined aid proposed will be expected to reach $750 million by the end of 2010 and $2.5 billion by the end of2014. Along with this combined form of aid, the Lugar bill will initiate the development of HECTARE, Higher Education Collaboration for Technology, Agriculture and Extension, which will encourage agricultural research efforts and help countries around the world in becoming more agriculturally independent.
While these efforts have great intentions for the rest of the world, the U.S. should first examine what are the possibilities of what could go wrong as a result of giving food aid to these countries before administration of the aid. As discussed in World Hunger on page 134, too much food aid could cause the country in need to become even more dependent on the U.S. and less self sufficient. “When the food aid stops, these industries, needing the supplies to continue their level of operations, will pressure the governments to keep importing the commodities on commercial terms.” In the case of these poor countries, they cannot afford to import commodities on commercial terms if they cannot be self efficient. Additionally in many cases, these countries already have an oversupply of a commodity. The true issue those countries face is food accessibility to those commodities. In the case of the Somali farmers discussed on page136 in World Hunger, when food aid was received, prices set by local farmers were driven down by 75 percent.
With the negatives that result from administration of food aid, there are negatives that result from administration of cash aid. Cash aid is often administrated only temporarily. As a result, foreign countries become dependent on aid overtime, and when the aid is revoked, the countries are in worse conditions economically then prior to the giving of aid.
Looking at these negatives for giving either source of aid, it seems fairly discouraging to ever administrate them; however, these negatives occur most commonly when either source of aid is over administered. A balance of aid must be established in two ways. Firstly, there must be a set amount of maximum cash aid administered for the country in need to intake. With this understanding that a country will only receive a certain amount of cash aid and that aid will be terminated at a certain time, the country in need can plan how to use their cash aid accordingly and pay off debts more easily versus if the cash aid was just suddenly revoked at a certain time due to economic conditions. President Obama is seeking to accomplish this first aspect of balance by setting a minimum of aid administration of $500 million with hopes to reach a maximum of $750 million given by 2010. The second aspect deals with seeking a balance between food aid and cash aid. Since over administration of either type of aid can result in the suffering country falling into worse economic conditions, not too much of either type of aid should be administered to a country in need. As stated on pg.145 of World Hunger, “we are not suggesting to abolish foreign aid” but instead, we need to try to find a way to “give something back” without causing more damage to the harm already done
References:
Frances Moore Lappe; Joseph Collins; Peter Rosset .World Hunger. New York. Grove Press. 1998.
Jay Sjerven. ” Lugar lauds Obama's call for stepped-up foreign food and ag assistance.” FoodBusinessNews.net. March 31, 2009. Food Business News. http://am.sosland.com/ActiveMagazine/getBook.asp?Path=FBN/2009/04/14&BookCollection=FBN_AM&ReaderStyle=Gray&browserWindowWidth=1630&browserWindowHeight=1000&ScreenRes=2&IsNetscape=1

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