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Restrictions on U.S. food aid waste time and money

In times of catastrophe, the world typically looks to the United States for help. And Americans respond. After the earthquake in Haiti, the U.S. government pledged $100 million in emergency relief, while private donations have totaled more than $500 million.

But even in quieter times, the United States is by far the leading donor of food for people in Haiti and other poor countries. Unfortunately, critics say, U.S. food aid programs are wasteful, costly and in, some cases, actually more harm than good.

"One criticism about food aid, especially with shipping to landlocked countries in Asia or Africa, is that it takes so long and is so expensive to get there,'' says Christopher Barrett, a Cornell University expert on poverty and international development.

The main reason for the high costs: The U.S. government requires that 75 percent of the food be transported by U.S. flag carriers even if it could be shipped more cheaply by foreign carriers not subject to U.S. taxes and regulations.

Moreover, 25 percent of the cargo must pass through Great Lakes ports. That means wheat grown in Kansas might not go directly to Gulf ports; it might first go north to Chicago, where it is put on a freight train, then sent south.

Because of these requirements, U.S. food shipping costs were about $70 per ton higher in 2007 than those for the United Nations World Food Program, the Government Accountability Office found. Shipping costs eat up about half of the U.S. food aid budget.

The purpose of cargo preferences is to have enough U.S.- flagged commercial vessels for national defense. Ships carrying food aid employ about 5,000 Americans and transport ammunition and other materiel to the Middle East, Japan and South Korea, the Department of Transportation says.

But, as Barrett found, many of the ships are actually owned by foreign companies. And "the overwhelming majority of U.S. food aid shipments are not on militarily useful vessels.''

"One of the key things people really don't understand is the role the shipping lobby plays," Barrett says. The preferences "can continue because very few people including senior policymakers have any idea that shipping is caught up in food aid."

The aid programs began in the 1950s as a way for the U.S. government to unload the huge surpluses of wheat, corn and other commodities it accumulated as a buyer of last resort when farm prices dropped.

More recently, most of the food has been bought by the government on the open market, "just like it would buy pencils or computers," Barrett says. Bidding requirements mean it can take six months to get food from a U.S. vendor to a foreign village.

"These commodities do not arrive in some cases until the end of the peak hungry season — from October to January in Southern Africa, for example," the GAO report said.

One of the most controversial aspects of U.S. food aid is "monetization.'' Unlike Europe, which gives cash to the World Food Program, the United States ships most of its food to private organizations that work in poor countries. The groups then sell the food on the local market, raising money for their own development projects.

"Taxpayers should be deeply concerned because it's intrinsically very wasteful," Barrett says of this cash-to-food-to-cash cycle. "You're only going to get 50 to 70 cents on the dollar."

Another concern: So much foreign food dumped into a poor country can cause steep price drops, hurting local farmers.

"One of the great ironies is that (organizations) are trying to establish viable farm-based programs in small countries funded off monetization, but monetization itself undermines local agri-businesses,'' Barrett says. "With one hand they're undoing what they're working on with the other hand.''

In September, CARE — which raised about $62 million a year through monetization — stopped the practice after concluding it was inefficient and even harmful. But Save the Children and many other groups continue, contending they have no choice until other funding is available.

American food aid programs have still more problems. To improve timeliness of deliveries, the government pre-positions food in certain places, including Lake Charles, La. But food stored there must be trucked to Houston, adding as much as 21 days, the GAO report said.

Older stocks of grains aren't necessarily shipped first, increasing the likelihood of pest and vermin infestation. Food quality has long been an issue. The GAO found "live and dead insects in bags of (U.S.) cornmeal, along with their nests" on a visit to a port in Durban, South Africa.

"Some of the food had been in containers for as long as 78 days," the report said. "This food could have fed over 37,000 people during a typical hungry season."

Susan Taylor Martin can be contacted at [email protected]

Who sends food

Food shipments from the United States in 2007-08 accounted for nearly half of the total amount given worldwide.

Country Amount (in metric tons)
Australia 216,726
Canada 520,963
European Union 2,178,309
Japan 428,301
Norway 102,955
Switzerland 68,872
United States 3,630,343
Total 7,147,409

Source: Food Aid Convention

Restrictions on U.S. food aid waste time and money 02/04/10 [Last modified: Monday, February 8, 2010 7:11am]
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