Wednesday, April 6, 2016

Peanuts and the Haitian Economy a minute?  Care to hear a smidge about how our U.S. economic policies sometimes have unintended consequences for other nations?  I know it sounds like a riveting topic but it's not quite as boring or complicated as it sounds.

The reality is that anytime a nation creates policies, be they foreign or domestic policies, there are often unintended consequences.  Implementing a policy often means that it touches the far corners of the room, impacting areas in ways no one intended or in ways no one could have predicted.  Sometimes, those unintended consequences are like extra spoils, taken from a treasure chest.  Other times, they reek havoc.  There is always a thread connecting the policy to all of the potential affected parties.

The USDA has recently announced plans to implement a policy connected to peanut production in the US that is going to pull a lot of threads for the farmers of another country.  Specifically, because of the way we do agriculture in the US, we will be subsidizing bumper crops of peanuts by buying those peanuts from our domestic farmers and then exporting them to other countries.  At face value, it seems like a win-win.  The US will buy peanuts from peanut farmers to help them from going bust while shipping them to a food poor country like Haiti where those peanuts will feed hungry people.  But here's the catch:  one of the major agricultural industries in Haiti is peanut growing.  This means that by flooding the Haitian market with US grown peanuts, Haitian peanut farmers will be selling their peanuts in a weakened market.  For countries like Haiti, that have fragile economies, where small businesses struggle such unintended consequences can be devastating.  (See this Washington Post article for more information.)

Unfortunately, this isn't the first time this has happened.  Haiti's native hog population was decimated by a USDA policy that was meant to prevent the spread of swine flu the late 70's and early 80's.  Specifically, native pigs were killed off and US grown swine were brought in.  Unfortunately, the US swine were not as hardy as the native variety and were much harder to feed.  This resulted in hog farmers in Haiti being driven out of business.  The US has also flooded the Haitian market with another product:  rice.  This happened in the late 80's; cheaper American rice drove Haitian rice farmers out of business.  And as a side note, most Haitians still struggle to afford rice.

To be sure, I'm not offering an opinion on if farmers should be subsidized or if certain tariffs are correct.  But I do think that are officials should consider how our policies affect our neighbors, specifically how our policies will impact the poorest country in the Western Hemisphere.

There is currently an online petition being circulated, asking the White House to stop the plan to export our peanuts to Haiti.  It takes less than five minutes to sign and is one way in which you can ask our government to try to avoid policies with unintended consequences that will negatively impact Haiti's economy.  Here's the link:   Haitian Peanut Petition.

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