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Why Keep Bashing The Board?

After decades of hard work, the Canadian Wheat Board’s opponents have finally won their battle. Normally, congratulations would be in order, but congratulations are deserved only by those who have courage of their convictions and are gracious in victory.

We’re not seeing much of either. Instead, the winners of this debate are continuing to heap abuse on the losing side, and running off with their tails between their legs to avoid the blame for the unintended consequences of their victory.

It’s now becoming apparent that some of the opponents of the CWB monopoly actually believed what they were saying all along – “We don’t want to lose the board. We just want freedom to market to whomever we want.” They figured they’d be able to truck directly to the U.S. every once in a while when the price was higher, but otherwise life would go on pretty much as normal.

It apparently hadn’t occurred to them that this is an all-or-nothing business. With no assets and no assurance of supply, no banker is going to lend the board the money to buy grain from farmers. The government can’t, or at least shouldn’t, guarantee the loans. That would give it an unfair advantage – in an open market everyone needs to play by the same rules.

The board doesn’t have any elevators or terminals, so in the event that the board did make a sale, it would have contract with its competitors to use theirs. For the board to be competitive (which by the way means offering alowerprice than the other companies selling Canadian grain), the competitors would have to charge the board less than they were charging themselves. That’s a non-starter.

The CWB is now pointing out that without a monopoly, it would be just another grain company, except one without capital, elevators or terminals. Who needs that?

For stating the obvious, the board is taking all kinds of abuse. It has no imagination. It hasn’t considered the options.

Yes it has. It’s considered the options carefully and concluded that without a monopoly, it has no future.

Perversely, those who have argued the loudest and longest against the board are howling even louder now that they are getting what they asked for. Western Canadian Wheat Growers vice-president Rolf Penner was at it again with an op-ed piece in the Winnipeg Free Presslast week, lambasting the board for “refusing” to provide a business plan and not listening to farmers.

Before writing that piece, Penner might have taken time to read the latest report from the Frontier Centre for Public Policy, for which he’s a former policy fellow. The Frontier Centre commissioned University of Manitoba agricultural economist Milton Boyd to assess the future of grain marketing after the end of the CWB monopoly. He came to much the same conclusions as the CWB, listing eight challenges for operating a voluntary board.

Board-bashing blogger John DePape has apparently come to the same conclusion. In his latest opinion piece, DePape says, “All this talk of different pools begs the question: once the CWB no longer has the single desk, government guarantees or enabling legislation, what is it? CWB supporters have said, perhaps rightly, ‘the CWB will not be anything more than a broker or another grain company.’” He then suggests that the federal government could offer pooling and risk management tools to a new CWB or “any other entity” (his emphasis).

With the overwhelming evidence that the CWB cannot survive with no money and no facilities, why does all the board bashing continue?

There are three explanations. One is that the critics don’t know much about grain marketing, and didn’t understand the implications of losing the monopoly.

The second is that they understand perfectly well, but don’t want to take the blame for the fallout. If so, shame on them. Instead, they should take a principled position and state that an open market is better, that the loss of the board is an unfortunate consequence, and that measures should be taken to ease the effects on its employees and its customers.

(By the way, has anyone asked the customers about this change? A statement from the minister’s office tells us that an industry working group is “consulting with a diverse range of stakeholders including farmers, the grain trade, railways, academia and government.” Nary a mention of customers, who just might have an opinion on the issue.)

A third explanation for the continued board bashing is that it’s been just an end in itself. Having got what they wanted, these organizations (or were they just clubs?) will have no further reason to exist.

In defeat, the wheat board has had the good sense and the good grace to say there is not much reason to continue if it can’t provide value to farmers. In victory, the opponents seem only to be able to heap more abuse on the board.

The battle is over. Why are they still fighting? [email protected]

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