EXAMPLE- A farmer in Kenya grows maize at a cost of 4.5 cents per pound, which is more than the US 'market' price of 3.5 cents per pound. But the true cost of production to an American farmer is 6 cents per pound. In this topsy-turvy world, the more efficient Kenyan farmer can't compete with less efficient American farmers who have the mighty American taxpayer subsidising their farm-gate price.
If the Chicago price was unsubsidised, the Kenyan farmer could compete and become more profitable. He would be able to pay for healthcare, education and manufactured goods - all to the benefit and future stability of Kenya. Instead, if the Kenyan farmer tries to sell for five cents per pound, in an attempt to make a profit, grain traders will import the cheaper American corn (cheaper even with freight costs).
Emigration, war and refugees are the result of agricultural communities going bankrupt. The lucky ones get a job in Europe or the USA, often illegally and in exploitative conditions; quite often - ironically - in agriculture. They then send their earnings home, to support their families who have stayed behind on the land. It is a wasteful and inefficient way of allocating the world's human and agricultural resources.
Harm to American and European small farmers- Family farmers, including organic farmers, receive lower levels of subsidy. Without subsidies big farmers would profit less from planting prairies of rape and barley or intensifying animal production. Small-scale farming would stage a comeback. Food prices might go up a little, but probably no more than the £20 per week per household that the Common Agricultural Policy costs. The CAP spends half its annual budget on subsidies to farmers, a quarter on storage and warehousing costs and a quarter on administration costs and fraud control. A child could see the waste in this.
