Europe's Agricultural Revolution

Europe's Agricultural Revolution				firstgroup of new members."

				Hungary echoes this argument. Almost two
				thirds of respondents insurveys conducted by
Author of "Malignant Self Love - Narcissism				the EU in Estonia, Latvia, Slovenia and
Revisited"
				Lithuania are undecided about EU membership
The June 2005 budget summit in Brussels				or opposed to italtogether. The situation in
foundered on the issue offarm support and				the Czech Republic is not muchimproved. Only
subsidies which now consume directly 46.2% of				Hungary stalwartly supports the EU's eastern
the				tilt.

European Union's (EU) funds. Tony Blair				Opinion polls periodically conducted by GfK
refused to let go of				Hungaria, a marketresearch group owned by GfK
				Germany, paint a more mixed picture. Onthe
Britain's infamous rebate (amounting to two				one hand, even in countries with a devout
thirds of its netcontributions to the				following of EUaccession, such as Romania,
community's coffers) unless and until				support for integration has declinedthis
thesehandouts (which Britain's dilapidated				year. Support in Hungary and Poland, on the
agriculture does not enjoy)are slashed. This				other hand, pickedup.
followed close on the hills of the rejection
ofthe proposed EU constitution in French and				Yet, the EU can't seem to get its act
the Dutch referenda in				together. According to the

May-June 2005.				Danish paper, Berlingske Tidende, Danish
				prime minister in 2002,
One of the undeniable benefits of the
enlargement of the European				Anders Fogh Rasmussen, ruled out a "take it
				or leave it" ultimatumto the new members.
Union (EU) accrues to its veteran members				There will be "real negotiations", he
rather than to theacceding countries. The EU				insisted.
is forced to revamp its costlyagricultural
policies and attendant bloated bureaucracy.				Not so, says Anders Fogh Rasmussen, the
This,undoubtedly, will lead, albeit				Danish president of the EUuntil Dec 31, 2002:
glacially, to the demise of Europe'sfarming				"The room for maneuver in negotiations will
sector as we know it.				bevery limited ... We have a certain
				framework, and we stick to it."
Contrary to public misperceptions, Europe is
far more open to tradethan the United States.				Yet, disenchantment should not be
According to the United Nations (UN), the				exaggerated. Naturally, flood- affected
				farmers throughout the region - from the
International Monetary Fund (IMF) and the				Czech Republic to
Organization of Economic
				Poland - are vigorously protesting their
Cooperation and Development (OECD), its				unequal treatment and thecompromises their
exports amount to 14 percentof gross domestic				governments were arm-twisted into making.
product (GDP) compared to America's 11.5				Still,according to a survey released in
percent.				December 2001 by the European

It is also the world's second largest				Commission, 60 percent of the denizens of the
importer. In constant dollarterms, it is the				accession countriessupported it.
world's largest trader.
				As the endgame nears, the parties to the
A Trade Policy Review released in 2002 by the				negotiations are posturing,though. EU
World Trade				enlargement commissioner, Gunter Verheugen,
				argued in
Organization (WTO) mentions two notable
exceptions: farm productsand textiles.				November 2002 against equalizing support for
Europe's average tariff on agricultural				Poland's 6 millionfarmers with the subsidies
produce isfour times those levied on				given to the EU's 8 million smallholders.
non-agricultural goods. Yet, a number
oftrends conspire to break the eerie				In a typical feat of incongruity he said it
stranglehold of 3-4 percent of				will prevent them frommodernizing and
				alienate other professions.
Europe's population - its farmers - on its
budget and politicalprocess.				Franz Fischler, the Austrian EU's agriculture
				commissioner, hintedthat miserly production
The introduction of the euro rendered prices				quotas for cereals, meat and dairy
transparent acrossborders and revealed to the				products,offered by the EU to the new
European consumer how expensive his foodis.				members, can be augmented. The EUpresently
Scares like the mishandled mad cow disease				provides the new members with funding, within
dented consumerconfidence in both politicians				the Special
and bureaucrats. But, most crucially,the
integration of the countries of east and				Accession Programme for Agriculture and Rural
central Europe withtheir massive agricultural				Development (SAPARD)to support farm
sectors makes the EU's Common				investments, to boost processing and
				marketing offarm and fishery products and to
Agricultural Policy (CAP) untenable.				bankroll infrastructureimprovements.
				Hungarian farmers, for instance, are entitled
The CAP guzzles close to half of the EU's $98				to up to
billion budget.
				$38 million of SAPARD money annually.
Recent, controversial reforms, introduced by
the European				In a thinly veiled threat, Fischler included
				this in a speech hemade in an official visit
Commission, call for a gradual reduction and				to Estonia in late 2002:
diversion of CAPoutlays from directly
subsidizing production to				"The EU enlargement countries should be
WTO-compatibleinvestments in agricultural				pleased with the 25 per centagriculture
employment, regional development,environment				subsidies, as the member states have not
and training and research. Unnoticed, support				agreed even onthat yet, therefore this should
to farmersby both the EU and member				be the first goal and only afterthat can
governments has already declined from				further subsidies be discussed ... It would
$120billion in 1999 to $110 billion in 2000.				not be verywise to tell the EU member states
This decrease has sincecontinued unabated.				that accession countries are notpleased, that
				would not be positive for the whole process."
Still, the EU is unable to provide the new
members with the samelevel of farm subsidies				Small wonder he was whistled down by irate
it doles out to the current 15 members.				Polish parliamentariansin an address to a
				joint session of the parliamentary committees
Close to one quarter of Poland's population				foragriculture and European integration in
is directly orindirectly involved in				the Sejm. Poland's fracturedfarm sector is
agriculture - ten times the European average.				notoriously inefficient. With one quarter of
				thelabor force it produces less than 4
The agreement struck between Germany and				percent of GDP. But the peasantsare well
France in September 2002and adopted in a				represented in the legislature and soaring
summit Brussels in October freezes CAP				unemployment -almost one fifth of all adults
spending inits 2006 level until 2013.				- makes every workplace count.

This may further postpone the identical				In the meantime, the ten new members of the
treatment much coveted bythe applicants.				EU have teamed up topresent their case in
Theoretically, subsidies for the farm sectors				Brussels. Their ministers of finance,
of thenew members will increase and subsidies				foreignaffairs and of agriculture,
flowing to veteran memberswill decrease until				parliamentary deputies in their financeand
they are equalized at around 80 percent				farm committees - all issued and issue common
ofpresent levels throughout the EU by the end				statements,position papers, briefings and
of the next budgetperiod in 2013.				memoranda of understanding. But noone is
				inclined to take such ad-hoc alliances among
But, in reality, the entire CAP stands to be				the candidatecountries seriously. The
renegotiated in 2005-6.				disparity between their farm sectors issuch
				that it rules out a single voice.
No one can guarantee the outcome of this
process, especially whencoupled with the Doha				Moreover, the EU is strained to the limit of
round of trade liberalization. The offers				its habitual consensus- driven decision
madenow to the candidate countries are not				making. The breakdown of the European
only mean but alsomeaningless.				mechanism ofdeliberation was brought into
				sharp relief by the way in which thefuture of
A tweak by Denmark, the president of the EU				the CAP was decided in a series of chats
in the second half of				between theleaders of France and Germany in a
				hotel in Brussels in 2002 . Theirdeal was
2002, to peg support for farmers in the new				later rubber stamped, unaltered, in a summit
members at two fifthsthe going rate, won a				of all EUmembers in October 2002.
cautious welcome by the then
candidatecountries. Some of this novel				The Union is in constitutional and
subventionary largesse will bededucted from a				institutional flux. Small andeven medium
fund for rural development in the new				sized members - such as the United Kingdom -
members.				aremarginalized. As the EU bloated to 25
				countries, a core ofleadership failed to
Additionally, national governments will be				emerge. Germany, France, the UK, and Italy
allowed to top upinadequate EU dollops with				-the industrial locomotives of Europe - are
governmental budget funds.				at odds and (with theexception of the UK)
				sputtering.
Even this parsimonious offer - still disputed
by the majority ofcontemporary EU members -				Decision-making has been reduced to the
will cost the Union an extra $500 milliona				Council of Ministers handingdown blueprints
year. It also fails to tackle equally weighty				to be fleshed out by the less significant
wrangles aboutproduction quotas, EU				states andby an increasingly sidelined
protectionist "safeguard" measures,				European Commission and a make-believe
importtariffs imposed by the new members
against heavily subsidized				European Parliament. The constitution which
				was supposed to restorecentral authority and
European farm products, reduced value added				participatory democracy is dead in the water.
taxes on agriculturalproduce and referential
periods and yields - the bases forcalculating				The countries of central and eastern Europe
EU transfers.				are and will, for a longtime, be second class
				citizens, tolerated merely because
It also ignores the distinct - and thorny -				theyprovide cheap, youthful, labor, raw
possibility that the newmembers will end up				materials and close-by marketsfor finished
as net contributors to the budget.				goods. The new members are strategically
				locatedbetween the old continent and booming
Quoted by Radio Free Europe/Radio Liberty,				Asia.
Sandor Richter, a seniorresearcher with the
Vienna Institute for International Economic				EU enlargement is a thinly disguised exercise
				in mercantilism tingedwith the maudlin
Studies, concluded that the first intake of				ideology of embracing revenant brothers long
ten new members,concluded in May 2004, will				lostto communism. But beneath the veneer of
end up underwriting at least $410million of				civility and kultur lurk thecold calculations
the EU's budget in the first year of				of realpolitik. The New Europe - the
membership alone.				EU'shinterland - would do well to remember
				this.
With the GDP per capita of most candidates at
one fifth the EU's,this would be a perverse,				============================================
socially unsettling and politicallyexplosive				=================
outcome.
				AUTHOR BIO (must be included with the
Aware of this, the European Commission denies				article)
any intention toactually accept cash from the
New Europe. Their net contributionswould				Sam Vaknin ( ) is the author of Malignant
remain theoretical, it pledges implausibly.
Yet, as long as acountry such as Poland is				Self Love - Narcissism Revisited and After
incapable of absorbing - disseminating				the Rain - How the West
andutilizing - more than 28 percent of the
aid it is currently entitledto - veteran EU				Lost the East. He served as a columnist for
members rightly question its administrative				Central Europe Review,
abilityto tackle much larger provisions - c.
$20 billion in the first threeyears after				PopMatters, Bellaonline, and eBookWeb, a
accession.				United Press International

The prolonged and irascible debate has taken				(UPI) Senior Business Correspondent, and the
its toll. In some newmember countries, pro-EU				editor of mental healthand Central East
sentiment is on the wane. Leszek Miller,then				Europe categories in The Open Directory and
Poland's prime minister, told the PAP news
agency in late 2002that Poland should				Suite101.
contribute to the EU less than it receives
inagricultural subsidies. And what if not?				Until recently, he served as the Economic
"Nobody would be overlyconcerned if Poland				Advisor to the Governmentof Macedonia.
did not enter the EU together with the

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Europe's Agricultural Revolution