Farmers are key to all rural growth experiments

By Hsu Shih-jung Lai Tsung-yu Yen Ai-ching 徐世榮 賴宗裕 顏愛靜

Taipei Times, Friday, Jan 23, 2009, Page 8

Why is Taiwan’s countryside in such a sorry state, and what can be done about it? A bill for rural regeneration that recently passed its initial review seeks to remedy the situation mainly through “vitalizing” the land, which actually means taking what was originally arable land and reallocating it for construction. Can such a policy solve the problem, or would it make the problem even worse?

We believe the main reason why the rural economy is so depressed is that agricultural values have been overlooked for too long and have not been reflected in the incomes farmers receive.

These multiple values are production, life and ecology. Although these three values have become the mainstay of Taiwan’s agricultural and rural land policy, they have not been reflected in farmers’ incomes.

Agriculture and farmland are of great value for the environment. The land holds and conserves important reserves of groundwater, while crops absorb carbon dioxide and release oxygen. But what have farmers been paid for this service? Nothing.

Another example: Agriculture and farmland have become an important cultural and tourism resource. City dwellers often go to the countryside on weekends to enjoy rural scenery.

Do farmers earn anything from this? Only a few proprietors of leisure farms make money from it, while most farmers gain nothing.

What about the productive value of farming and farmland? Does it get the recognition it deserves? The answer is disappointing.

As Uncle Kunbin (昆濱伯) says in the documentary Let it be (無米樂), “a pound of rice sells for less than a bottle of mineral water.” What a mockery. This situation has arisen because the government has for years had a policy of keeping grain prices low.

All in all, the ecological and productive values of agriculture and farmland have not been realized through market mechanisms. While successive governments have sought to stabilize consumer prices by holding down the price of grain, input costs have risen.

Caught in a trap, farmers have seen their incomes drop to a pitiful level.

The experience of other countries has been different. Even under WTO rules, EU member states and many other advanced countries do everything in their power to support farmers, largely through direct subsidies, because they recognize the ecological and cultural value of agriculture and farmland.

For example, in Switzerland in 2006, direct payments to farmers accounted for 67 percent of total spending on agriculture — an amount roughly equivalent to NT$75 billion (US$2.25 billion).

The Swiss government gave on average NT$1.2 million in financial support to each farmer in lowland areas and NT$1.4 million to those in the mountains in 2006. Government support for farmers in Taiwan pales by comparison.

In fact, the land has always been full of life — it is farmers’ incomes that are moribund. Many farmers have become so poor that all they have left is their land. If we want to help them, is “vitalizing” their land by building on it really the best way to go about it?

What will farmers be left with if they sell their land? Surely it would be better to have them keep their land and gradually raise their incomes.



Hsu Shih-jung, Lai Tsung-yu and Yen Ai-ching are professors in the Department of Land Economics at National Chengchi University.

TRANSLATED BY JULIAN CLEGG

2009/1/23發表於Taipei Times