How High the Ceiling? US Proposal on Agricultural Subsidies Would Make Caps Meaningless

While US negotiators continue to hammer on the European Union to improve its offer on agricultural market access in the Doha trade talks, US intransigience is holding up progress on agricultural subsidy cuts. One of the few achievements thus far in the negotiations is agreement that there should be caps on the amount of subsidy for specific commodities, such as cotton. US negotiators are insisting on using 1999-2001 as the base period for setting these caps, while other negotiators want to use a longer period average, for 1995-2000. This chart (PDF), based on U.S. government data, shows why other countries are rightly opposed to the US proposal, which would render the break-through on commodity-specific subsidy caps meaningless. (For a closer look at U.S. ag subsidies, see my recent brief: Delivering on Doha: Are the Proposed Cuts in EU and US Agricultural Subsidies Real?)