As I watched this week’s episode of TVO.org’s Political Blind Date, I couldn’t help asking myself: Does supply management count as a subsidy? If not, why not?
The context: on this outing, Tory MPP Randy Pettapiece (the parliamentary assistant to the minister of agriculture, food and rural affairs) takes Green MPP Mike Schreiner to a highly automated dairy farm (it features, for example, a milking station the cows are trained to enter on their own, when they feel like it). The owner argues that Canada’s dairy-supply-management scheme lets farmers make long-term investments in their facilities knowing that, thanks to guaranteed prices, they’ll pay off.
(I’m not going to rehash all the arguments against supply management here, but, suffice it to say, the benefits are hotly contested. That doesn’t really matter, because literally nobody in Canadian or Ontario politics is talking seriously about dismantling supply management, not least because of the very real problems United States dairy farmers have been having lately.)
Things do get more complicated, however, when Schreiner proposes that we reward farmers for sequestering carbon: Pettapiece is profoundly skeptical of measures that, he says, would amount to government subsidies to help fight climate change.
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There’s undoubtedly some way to square the circle of “we have to make milk more expensive so that farmers can afford dairy robots, but we can’t subsidize the work that would lock carbon in the ground to save the planet,” but I confess it eludes me. It was also more than a little amusing to me that, while I was watching Pettapiece insist that farmers don’t want or need subsidies, a press release titled “Governments Supporting Ontario Grape Growers” arrived in my inbox. The subject: the province’s new $2 million funding package for the wine industry.
Shocking but true — political parties in power can be less than 100 per cent consistent when it comes to their principles. Honestly, it’s nothing to get scandalized about. But it would be worth asking why we’re subsidizing agriculture and what we’re hoping to accomplish, instead of simply taking as given an incoherent system of subsidies, tariff walls, marketing boards, and other measures.
One of the obvious reasons to support agriculture is that doing so supports rural communities. To policy-makers, this is almost tautological: farms are in rural Ontario, we want to support rural Ontario, so let’s support farms. And, given the profound and growing differences in economic fortunes in Ontario —Toronto and Ottawa generate nearly all the jobs growth while the rest of the province is left behind — it’s an argument that should be taken seriously.
It’s true that farmers will benefit from some recent changes in provincial policy: the Tories have been more energetic than their predecessors about expanding natural-gas infrastructure to rural areas (for better and worse). The problem is that, while agriculture is the most visible form of industry in much of rural Ontario, it hasn’t been the primary employer there for decades. Globalization also means that farm-supply chains — seed companies, tractor factories, and so on — are less focused in the province. Farm subsidies don’t subsidize nearly as many indirect jobs as they once did.
And it’s likely to get worse: the dairy farm in this week’s episode of Political Blind Date is proof that a new wave of automation is coming to agriculture. As a result, even fewer people in rural Ontario will be directly employed in farming.
So if we want to support rural regions in Ontario, we need to think more broadly about what the economic prospects for rural areas are going to be. Taking care of and amusing people — in ways including but not limited to tourism — could be good candidates: demand is eternal and tends not to be outsourced to other countries. I’ve also argued before that the province should think harder about siting university campuses in places that could use the economic boost (and not just those in the GTA). Rural leaders know about all these problems and the most common proposed solutions — it’s translating them into policies at Queen’s Park that’s harder.