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Eliminate Unprofitable Farmers, Report Recommends

A new report proposes a radical and drastic solution to Canada’s chronic farm income problems: get rid of unprofitable farmers.

The report by the Canada West Foundation recommends “an orderly retreat from the industry” by farmers who depend on government subsidies and off-farm jobs to stay in operation.

The Calgary-based public policy think-tank says agriculture should stop acting like welfare and behave like a real business in which the profitable survive. He says the Canadian Wheat Board should be made into a farmer-owned grain company and supply management should be ended so that those industries become more responsive to market forces.

The report, written by Greg Mason, a University of Manitoba economist, claims Canadian agriculture is driven by an outdated model whose day is long past.

It’s time to “shake off the final vestiges of the National Policy introduced by the MacDonald government over a century ago” and establish agriculture policy that “escapes its Depressionera roots” and evolves “from an income support system that resembles social assistance to a business support model,” Mason writes.

Right now, Canadian agricultural policy is a hybrid offering “contradictory incentives, combining elements of a social safety net for families with industrial policy.”

Instead, policy should “focus on the growth of farms as businesses that do not require chronic subsidization, thereby creating a sustainable agricultural sector.”

To achieve this, Mason, also managing partner of the Winnipeg firm Prairie Research Associates, recommends four policy initiatives: combining all income supports into one CAISlike program; a cash injection to help farmers restructure their operations; deregulating for competitiveness; increased support for research and extension.

Ian Wishart, Keystone Agricultural Producers president, agreed with Mason that agriculture needs a long-term vision, not short-term fixes.

But Mason would throw the baby out with the bath water by turning farming into a hard-nosed profit-driven model in which only the fittest would survive, he said.

“(His) premise seems to be that if we get rid of the middle-size farms, we’ll have a higher percentage of the marketplace making a profit. Our argument has been, we need to create a situation where the middle-size farms can make a profit, not to get rid of them. That’s where we basically disagree,” said Wishart.

“I don’t want to see a third of the farmers leave the marketplace so that perhaps everyone else can make a little more profit.”

But Wishart did agree with Mason that current farm programs are a patchwork which sometimes work against each other.

Terry Pugh, National Farmers Union general manager, said the report was “eerily reminiscent” of a 1969 federal agriculture task force which said, in effect, that Canada had too many farmers.

Now, 40 years later, thousands of farmers have left the land but the argument is still heard, Pugh said.

“Their solutions are no solutions at all.” [email protected]

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