July 17, 2009

EU farm subsidies off target, some say

The European Union's mammoth farm subsidy program has become sprawling and unfocused, agricultural economists said.

The $71 billion program that now subsidizes rural development and exports, also includes funding for landowners, meaning the wealthiest Europeans receive bigger subsidy checks than small farmers, The New York Times reported Friday.

A small farmer might receive a $600 subsidy, while the Queen of England last year qualified for $778,812 in subsidies to offset costs of running a 20,000-acre estate called Sandringham Farms.

Cargill, a corporation with $168 billion in revenues last year was granted $14.7 million in subsidizes from eight different European countries. Large construction firms also qualify, based on their part in rural development and Ligabue, an Italian food company that caters to the travel industry qualified, in part, for exporting coffee creamers on airlines and cruise ships.

Agricultural economists for the Organization of Economic Cooperation and Development criticized the program's support for unintended beneficiaries. At Humboldt University in Berlin, agriculture economics professor Harald von Witzke said the program funded big guys "¦ that don't need it.

Economist Stefan Tangermann said families pay twice for higher prices in the stores and for taxes that they pay out for subsidies, the Times reported.