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Feds Shift Food Aid Practices

posted on August 29, 2014


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The United States is, by far, the world’s largest donor of international food aid. Last year, America contributed about one-third of the $4.4 billion given to the predominant international distributor: The World Food Programme. The federal government buys the vast majority of its goods from U.S. producers, but policymakers have begun to purchase more food from foreign suppliers. And while the shift in policy has proven to be controversial in some circles, proponents say it results in more efficient delivery and a better return on investment for taxpayers. Paul Yeager explains.

The United States government began a subtle but significant shift in recent years, moving away from its longstanding policy of buying grain and other food for international donation solely from U.S. sources.

Until four years ago, nearly every taxpayer dollar spent on buying and shipping international food donations went to U.S.-based suppliers and, indirectly, U.S. farmers. An analysis by Market to Market reveals, however, that beginning in 2010, the government began increasing the amount of food it purchases from foreign suppliers. In 2013, a record 25 percent of the money used for food donations was spent outside the U.S.

The shift -- a deliberate one allowed by budget and administrative rule changes -- is designed to help support farmers living in or near struggling or poverty-stricken nations. It is also intended to reduce government costs associated with shipping food overseas.

Adam Reinhart, USAID Food for Peace Office: “If there is a drought in southern Mali, which is a country in West Africa, and there northern Mali has plenty of grain, so we can actually then have the ability to buy grain in northern Mali to ship it to the south. And … research shows that is quite a bit faster than even from pre-position.”

Pre-position refers to the stockpiles the United States has placed strategically around the world so food can be shipped more quickly to nations facing natural disasters or other emergencies.

Adam Reinhart, USAID Food for Peace Office: “We issue a tender for these. People bid on it. The best price wins. And then it is literally shipped down, usually through the Mississippi, and then out through Louisiana to wherever it’s going around the world to where it is needed, and literally on a boat. Then it is offloaded on a boat and then loaded onto trucks usually and then driven from a port to the actual place where the beneficiaries need the food.”

The shift has happened as Americans weigh the hoped-for cost savings and possibility of helping struggling farmers elsewhere with the abandonment of a tradition of buying only U.S.-provided foods, and shipping at least half with U.S.-owned cargo ships.

Few other, if any, of the world’s so-called “donor countries” require donated food be purchased from its own growers and suppliers. Most nations give money rather than food. Canada decided six years ago to relax its food aid rules and now donates cash to the World Food Programme and the Canadian Foodgrains Bank rather than food.

Tom Schatz, Citizens Against Government Waste: One of the objections to the efforts to increase the amount of money that could be used locally to grow crops was from both U.S. farmers and shippers. Both claim that it would cost Americans jobs if more money was used to grow crops locally rather than having U.S. crops sent overseas. The amount of money being spent for this program is very small compared to overall exports of U.S. commodities. Therefore, it’s really not costing the shippers or the farmers a lot of money to increase the amount of crops that are being grown overseas.”

The United States began the tradition of providing taxpayer-funded international food aid in the aftermath of World War II.

Adam Reinhart, USAID Food for Peace Office: “In the process of rebuilding Europe, we found that not only was it good for the Europeans, but it was immensely good for Americans and American business too because as the Europeans were rebuilding their economy, they needed American products and American services which were provided in great amounts by the United States to those countries.”

In the ensuing 60 years, even when drought or other issues pushed prices higher, the government has purchased enough food domestically to donate.

Tom Schatz, Citizens Against Government Waste: “There are a lot of strong feelings about providing economic and military assistance to other countries but foreign aid is about 1 percent of the entire federal budget. Foreign aid is a lot less money than most taxpayers think it might be in terms of how much gets spent.”

The United States Agency for International Development, or USAID, coordinates the majority of the government’s international food aid. Recently, it has placed greater emphasis on supporting programs that help other nations feed themselves.

Adam Reinhart, USAID Food for Peace Office: “We have a large program called Feed the Future initiative…Part of its goal is increase productivity of existing farms, but also to bring marginal lands into production. And Food for Peace also addresses those issues by doing those same things.”

The push toward “local and regional procurement” means that food is purchased, if possible, within the country or region where the food is needed. A priority is placed on buying from underdeveloped nations, with the exception of ‘enemy states.’

But local and regional procurement is not without challenges. Government leaders worry about the impact on foreign markets when buying a large amount in a region.

American Farm Bureau Federation President Bob Stallman has written about these changes, arguing that a cash-donation system creates more opportunities for the money to be used on something other than food. One taxpayer advocate, however, praises the greater flexibility provided by the move to local procurement, and the potential for reducing shipping costs.

Tom Schatz, Citizens Against Government Waste: “This helps increase the amount of crops that are available, it reduces costs for the taxpayers and is one of the few positive aspects of improving the effectiveness of foreign aid.

Adam Reinhart, USAID Food for Peace Office: “I’ve never been to a place where food aid was not appreciated, all the countries I’ve been to. The quality is good. The people love the food. They eat the food. It saves lives…In addition, of course, it has a whole public diplomacy concept to it too for the developing countries’ people to see that the Americans care about them because as you can imagine we don’t always have the best appearance overseas.”

Adam Reinhart, USAID Food for Peace Office: “And by not providing food to aid to that level, we would literally be relegating huge amounts of folks to poverty and sickness and malnutrition for generations.”

For Market to Market, I'm Paul Yeager.

 Additional footage courtesy of USAID, World Food Programme and Asterisk Productions, Ltd.


Tags: Adam Reinhart citizens against government waste developing countries food aid foreign aid policy grain local procurement Tom Schatz u.s. farmers untied aid USAID USDA