ACTION recently organised one of its ‘global lunches’ in Kitty O’Shea’s, a lively establishment next to the main EU institutions, named after the famous lady whose affair with the Irish nationalist politician Charles Stewart Parnell scandalised Victorian Britain.
About a dozen people attended and the discussion was equally lively – perhaps ACTION manages to create a scandal of its own with its proposal for regional food reserves.
ACTION’s objective is to introduce sovereignty-sharing to other parts of the world. In the 1950s, the trigger for European countries was coal and steel. We believe that today’s trigger could be regional food reserves – i.e. a food reserve that is shared by countries within a region. We are delighted to say that a draft resolution to this effect is going around the European and Latin American parliaments. It is impossible at present to know whether this resolution will fail or succeed. It is a significant development and we look forward to hearing from Mr. Riccardo Lagos, who works for the Central American Parliament, at our next global lunch in January.
There is no doubt that the EU lacks confidence at the moment, as the pundits fall out over whether the so-called ‘BREXIT’ harbingers the collapse of the EU (not to mention the collapse of the UK due to talk of Scotland breaking away) or a temporary blip in what has so far been a remarkable expansion from the six founder members. But ACTION remains convinced that the EU model remains a good one and that the ‘community method’ is worth taking seriously in other parts of the world.
Why introduce it through a system of regionally-managed food reserves? There are many answers to this. One practical consideration is that food price volatility can have catastrophic consequences for many people in developing countries, and a food reserve can help to moderate that volatility. Another consideration is the fact that a system of food reserves once established can effectively be financially self-sustaining, because it entails releasing food onto the market from the reserves when the price is high, and replenishing the reserves when the price is low. The profit from selling when the market price is high and buying when the market price is low can then be used to offset the storage and administrative costs of maintaining the reserves.
It is a wonderful example, for those who support development aid, of giving developing countries start-up funding after which they can maintain the food reserve without further help. Sustainability is the buzzword in development circles, and this is a sustainable system.
It was clear from the discussion that many people remain worried that we are advocating ‘price-fixing’, ‘price-setting’, tampering with markets and so on. We are not. No prices would be set. The regional reserve would be just another market participant, buying and selling at the prevailing market price.
What ACTION proposes is a means of avoiding food crises. We have seen plenty of such crises around the world in recent years, ones where people are desperate for food that they cannot afford. But we do not propose that during a crisis food is sold cheaply or at less than market prices or that it is given away for free. We propose instead a system that prevents these crises arising in the first place.
The countries that belong to the regional food reserve will be able to maintain a constant supply of food on to the market for their people – even when supply from farmers falls or the price on the world market is too high to be able to afford to import food. The countries will be in a position to keep food flowing on to the market and will thereby pre-empt a massive price hike. When supply levels are high they will be able to replenish their reserves, thereby increasing demand. This will ensure that the market price does not fall too low for their farmers to be able to make a living.
We have taken our ideas to the European Parliament on several occasions, and it has been heartening to see that we obtained support from a wide area of the political spectrum. The Right recognized that we were using market forces, not interfering with them; the Left realized that we were using market forces in order to help prevent chronic hunger. Only what can be called the hard Left, which believed that no spoon was too long for supping with the market devil, had difficulty in accepting our argument. Consequently we have received support from the main parties in the Parliament.
ACTION would gratefully welcome any advice for promoting its ideas, not only within the European Institutions but also beyond the European Union.