BURNING OUR MONEY

Featherbedding farmers: £10 billion every year

Quite understandably there's huge indignation at the Freedom of Information disclosure that unreconstructed farming toffs, like Prince Charles and the Duke of Westminster, are being featherbedded by CAP subsidies.

But as the Telegraph reports:

'...the major recipients of the £3.9 billion that the British taxpayer pays into the CAP are big companies with little or no link with the land.

Principally, they are sugar and dairy processors, the top dozen of which received more than £10 million each, nearly five times more than any farming business.

One such firm, Meadow Foods, received £25 million, and Nestlé £11.6 million, but the others in the top 10 are dwarfed by Tate & Lyle, which received £127 million.

The reason so many food companies receive so much money is that subsidies and import controls make sugar three times the price it is on the world market and dairy products twice as expensive.

To compensate for the higher prices that result from European Union protectionism, companies that export outside the EU are entitled to apply for export refunds that cover the difference between the prices at which they buy and sell.

Producers of processed foods are allowed production refunds for the same reason.'

So to compensate for the inequity of our artificially high food prices, taxpayers have to subsidise foreign consumption of our processed junk foods.

Lunacy on lunacy.

But of course, although our farmers don't get the whole of that £3.9 billion tax transfer, they do benefit hugely from those higher food prices.

The OECD, which every year publishes its aggregate Producer Support Estimate (PSE), says:

'Clearly, in asking how much is spent on agricultural policies, it is crucial to consider overall support, rather than just government payments. Out of the Euro107 billion producer support going to EU farmers in 2002, Euro61 billion came from consumers’ pockets to pay the high prices caused by tariff protection and export subsidies, and €46 billion from tax transfers.'

Euro107 billion is the equivalent of about Euro280 per head. So with a UK population of 60 million, and an average 2002 exchange rate of 1.6, this implies a total CAP cost to UK taxpayers and consumers- ie you and me- of over £10 billion.

And as for paying farmers to 'look after the countryside', why can't they just sell out to investment banker vanity farmers? Unlike real farmers, they won't want to grub out the hedgerows, and they'll be more than happy to pay for ornamental sheep, haywains etc.

And why can't I have a subsidy for looking after my garden?

EU Constitution cost £100 million

England Expects has ferreted out the cost of producing Giscard's grand euro-constitution:

'According to the Budget published in the Official Journal ofthe European Union dated March 8th 2005it cost:

Budget Line 372
Contribution to the Fund for the financing of the Convention on the future of the European Union
Chapter 37 Total

Euro 38 239 968 in 2003
Euro 43 574 000 in 2004
Euro 55 078 500 in 2005

Even with my bad maths that adds up to a grand total of...

136,892,468 Euros

Worth every groat I am sure.'

Minister for Europe

Is this job a deliberate wind-up? It used to be filled by the pompous vacuity that is Peter Hain. Now we’ve got New Labour europhiliac Denis MacShane, a man whose main distinction, according to the Almanac of British Politics, is that he bears a passing resemblance to Bugs Bunny. If I were Bugs I’d sue.

I’ve just heard him pontificating on BBC5 Live about the euro-constitution. Pretty well unchallenged, he told us if we rejected the constitution we’d be shown up as isolationist, europhobic Little Englanders, turning our backs on the future, certain to go green and scaly, blah, blah, blah.

Then he was asked to identify the single key advantage to us of the constitution- a gently underarm delivery you might think. Alas, once asked for a specific, all he could come up with was ‘jobs’.

Say what?

Jobs?

Are we talking about the same euro-sclerotic hulk that’s condemned Germany to those scary Weimar Republic levels of unemployment, etc etc? Jobs?

Maybe he meant jobs for the boys. Like the ones we saw in that fly-on-the-wall about Kilroy at the eurowaffleshop. Those jobs like their graces the Lord and Lady Kinnock had.

He probably didn’t mean jobs at all but more that business about the EU constitution being the only thing standing between us and the panzers rolling again. Unfortunately when asked the specific question, he panicked, and his brain stylus jumped a groove onto the next track- about Labour’s economic miracle.

Anyway the underlying idea seemed to be that if we vote against the constitution, and if everyone else wants to go ahead anyway, and if they decide to kick us out, and if they ban our beef, and if we don’t retaliate by banning their surrender-cheese and cars, and if we can’t join NAFTA, and if the polar ice caps melt, and if the Da Vinci Code turns out to be true, and if those crop circles…oh man, we’re in deep shit…you know what I’m sayin’?

Now look Den, every serious analysis of our EU membership shows the economic costs and benefits are now pretty well a wash. Yes, we would suffer some disadvantage from being outside the EU tariff wall, but world tariffs are much lower now than when we joined. And we’d escape the CAP with all those budget contributions and inflated food prices. Not to mention all that social chapter style anti-market nonsense. And of course, if we lost our rebate or we were forced into the one-size-fits-all Euro, the economic balance would swing heavily in favour of leaving. (For a good analysis of the economic costs and benefits, see ‘Better Off Out?’ an IEA paper by Brian Hindley and Martin Howe).

So Den, do yourself a favour mate- when you’re next asked how the constitution benefits us, for gawd’s sake, don’t mention jobs. In fact don’t go anywhere near the economic balance sheet. Stick with those panzers, or some major arm waving about our place at the top table, or our freedom to live in Tuscany, or crop circles, or…well, just think of something.

I’m sure Bugs would have done a lot better.