A drastic restructing of the American food production system that would subsidize farmers to keep down prices and curb agribusiness growth was advocated in a study released yesterday by the Exploratory Project for Economic Alternatives.
The study is the first in a planned series of a dozen reports on economic alternatives by the Exploratory Project, a Washington-based research group funded by 25 foundations and individuals to stimulate debate on new economic approaches.
The group is headed by Gar Alperovitz and Jeff Faux, who have advocated overhaul of major corporate and governmental institutions to produce greater economic security and decentralization. The study was done by Joe Belden and Gregg Forte, and its findings were described as preliminary.
"Low, stable food prices, a secure income for family farmers and a shift away from agribusiness must be the heart of a new American food policy for the coming decades," said the report.
"In the coming era of intensified food inflation, resource shortages and pollution, the United States can no longer afford a narrowly based policy geared to supporting agribusiness at the expense of family farmers, the environment and customers," it added.
As part of an overall plan to keep down food prices while protecting the incomes of family farmers, the study proposed establishment of food reserves, government control over farm imports and exports, break-up of agrbusiness monopolies and direct government payments to compensate farmers for what they would have gotten from higher prices.
The subsidy program - which harks back to a program (the Brannan plan) for direct payments to farmers that was proposed but never implemented during the Truman administration - would cost between $12 billion and $15 billion per year, depending on the number of commodities covered, the study said.
The payments would be financed by a "steeply progressive" income tax weighted toward upper-income taxpayers, it added, contending this would be "more equitable and less inflationary" than paying for cost increases with higher food prices.
According to the study, the costs to the taxpayer would be offset by positive gains for the economy. The report noted that continually rising food prices contributed to an average annual increase of $15 billion in the nation's food bill over the last four years.
In addition, the study proposed tax policies, antitrust action and strict payment limits to "break the hold of agribusiness and its government allies over production itself, over agricultural research, farm cooperatives, the supply of the farmer's necessary inputs and food distribution."
The study d nationwide production of most crops on small, multi-cronoted that about 2.5 million family farms went out of business between 1945 and 1973, while farms sales of $100,000 or more grew fivefold between 1960 and 1974.
The study also suggested a shift toward nationwide production of most crops on small, multi-crop farms, which it said would produce an agricultural sustem that is "cleaner, more energy-efficient, more conserving of land and water and of a more human and natural scale." In particular, the study suggested labor-intensive organic production of dairy products, vegetables, fruit and meat and location of diversified farms near population centers.
"Our agricultural system has substituted machines and fuel for labor and land," the study said. "Unfortunately, today we have a surplus of labor and a shortage of energy."