The USDA recently released their list of legislative principles for the renewal of the 2018 farm bill. Farm bills have been around since the 1930s and originally focused on bolstering support for agriculture production. The current bill is renewed every four years and has grown to include a wide range of legislation including subsidy programs, crop insurance, and foreign aid.
Part of the USDA’s list includes moving towards outcome-oriented aid programs that aim for self-sufficiency. This transition has been a long time coming and is reflected in Senator Corker’s plan to improve food aid by eliminating the Cargo Preference for Food Aid (CPFA). The CPFA stipulates that 50 percent of food must be transported using U.S. cargo ships. Enacted in 1954, CPFA has nothing to do with food security but was instead designed to promote the existence of a private maritime transportation system in case the military should need it in wartime.
There is reason to be optimistic about Corker’s success. In June 2017, he was able to prevent Trump from increasing the CPFA requirements. Hopefully, in 2018, Corker is able to take this a step further and convince Trump to eliminate the policy altogether.
Spending more on aid is only a positive if current programs are working, which they are not. Despite the 76 percent decrease in food aid spending since the 1960s, the U.S. remains the dominant global contributor and is responsible for 40 percent of international food aid. For taxpayers, the cost averages $2.4 billion a year since 2014. Included in this price is $107 million that could be saved if food aid was not required to use more expensive domestic ships because of the CPFA. With the savings from removing the cargo preference policy, an estimated 1.8 million additional people could be reached.
The Types of Food Aid
However, spending more on aid is only a positive if current programs are working, which they are not. Despite the good intentions of donors, shipping food to needy countries does more harm than good. Food aid comes in two forms: crisis and continuous. Both have failed. Therefore, savings from eliminating cargo preference should be used to reduce overall spending on foreign food aid.
Receiving U.S. food aid is positively correlated with a higher probability and increased duration of civil war. Crisis aid accounts for the majority of food aid and is intended for short-term relief. The current 20 million people who are in danger of famine are suffering not from natural causes, but rather from man-made food shortages. These famines are largely due to internal violence or civil wars which are actually made worse through misdirected food aid.
In South Sudan, food aid is used as a weapon and is either looted and destroyed or blocked from reaching those in areas controlled by the opposition. Similar instances occur in Somalia where aid organizations are heavily taxed, which results in additional funds that are used to perpetuate the conflict. In fact, receiving U.S. food aid literally feeds the violence and is positively correlated with a higher probability and increased duration of civil war.
Continuous aid is often mistargeted by being delivered to entire communities and not just those who are most in need. When aid is widely dispersed, it creates spillover effects: unintended consequences from the mistargeting of aid. Free food being shipped into a country increases the availability and, as a result, drives down the price of food as a whole. These prices may be part of the reason why food aid does not solve long-term problems and, instead, creates reliance.
The Problems with Food Aid
In 1996, sub-Saharan Africa was the largest recipient of food aid, followed by Asia. In 2008, they still remained the largest recipients, but sub-Saharan Africa’s share of total aid had almost doubled. Instead of providing solutions, the aid has created different problems.
Growing evidence shows that the problem is getting worse as the country becomes increasingly reliant on external aid. There are two types of dependence: country-level and individual. Much of the literature attempting to dispel reliance theory is focused on the individual level. However, country-level reliance deserves equal attention as it can be detrimental to food security.
This is shown in the case study of Ethiopia, who has been receiving food aid for decades with an average of five million dependents a year since 1984. Over 16 percent of the population received some sort of food aid, and these numbers are not shrinking. In the 1950s, the share of food aid as a percentage of Ethiopia's annual exchange earnings was at two percent. By the 90s, this had grown to over 40 percent.
Food aid has not only failed to solve the problem of food insecurity, but growing evidence shows that the problem is actually getting worse as the country becomes increasingly reliant on external aid to fill their production gaps.
The best change that could happen to food aid is to reduce it. Changing the Farm Bill could be a step in the right direction for U.S. food aid policy, or it could end up fanning the flames of failed programs. Savings from the CPFA should be eliminated from the overall budget, not used to fund more failure.