4. Agriculture
Agriculture may not be the most important problem for Britain in its negotiations over the Common Market but it is certainly going to be one of the trickiest.
Nor should it be forgotten that agriculture has been causing a great deal of trouble within the Common Market itself. Only recently, France declared that she would veto any fresh moves on the industrial front until West Germany showed more enthusiasm for removing the barriers on the agricultural side. The motive, of course, was the usual one—France is keen to get a larger slice of the German market for her agricultural exports.
The fact that Denmark, another large exporter of foodstuffs, has also applied for membership of the Community will cause further complications. It will be interesting to see how all these conflicting interests are finally sorted out, if in fact they ever are.
Britain
But there can be no doubt that British agriculture has plenty to worry over. Home farmers are overwhelmingly opposed to Britain going into the Common Market and have done their utmost to prevent it. There is equally no doubt that it is fear for their agriculture that has caused many Commonwealth countries to make such an outcry about Britain’s application to join. But in this modern world of capitalism it is the interests of industry that call the tune and the Macmillan Government has gone on regardless of both farmers and Commonwealth.
British agriculture has good reasons to be wary of the Six. In the first place, in spite of all the efforts during and since the war to step up home production, the U.K. has still to import more than half its food. Most of these imports come from the Commonwealth—meat and dairy produce from New Zealand and Australia, wheat and coarse grains from Australia and Canada, and such things as fruit from all three. Much of this comes in at preferential tariff rates, though this benefit is not so important as it once was.
On the other hand, the Common Market is virtually self-sufficient in foodstuffs. Indeed, certain countries like France and the Netherlands are now actually piling up surpluses. France in particular, as a result of improved methods since the war, is rapidly coming to the point of crisis in the production of some items, for which she is becoming desperate to find markets. Nor is the position going to improve since she has vast capacity to expand. By far the largest country in area (second only to Russia in Europe), and larger still in actually usable agricultural land, it has been estimated that with fully improved methods she could supply the whole of the Six with some products, notably wheat and beef. It is the fear that France may insist on supplying Britain with wheat that is causing Canada particular concern.
Both France and the Netherlands, and Denmark if she also joins, see Britain’s entry into the Common Market as providing a welcome outlet for their agricultural exports. The British farmer takes a much less rosy view of the prospect.
His pessimism is made worse when he considers a further important difference between the way his products are sold compared with the Six. This is strange on the face of it because food prices are generally higher within the Six than they are in this country and this should apparently be to his advantage.
But the reality is not so re-assuring. The reason why food prices are generally lower in Britain is because it has long been the policy of British governments to keep them down artificially. Their method of doing this has been to allow food to come into the country almost free of restriction and let prices find their own level irrespective of the fact that these prices are below those at which the home farmer can produce economically.
This policy if left unchecked would, of course, soon bring most British farmers to bankruptcy. To avoid this, the Government has regularly made up the difference between the farmers general price and the imported price by means of subsidies. This difference is certainly not chicken-feed—it amounts to about £250 million a year, plus many more millions in the way of other payments to assist and improve their farming.
The Six
This procedure is in marked contrast to the system in most countries of the Six, whose governments have been more inclined towards policies of keeping out foreign imports by means of tariffs and quotas. They have been able to do this mainly because they are largely self-sufficient in food and the result has been that though prices are higher they are at the same lime more closely related to the farmers’ actual costs.
In practical terms, of course, the two systems boil down to essentially the same thing. All that happens is that the subsidies needed to help out the British farmer are found from extra taxation so that overall the amount actually received is near enough the same. But it has been an exceedingly useful method for the British capitalist class in keeping food prices stable and thus of helping to keep wages under better control. It was, of course, used to its greatest effect during wartime and in the critical period immediately afterwards.
The Six have already made it clear, however, that they will expect Britain to fall in with their system. It is also pretty obvious that the British Government will not in fact be unduly upset about this since whatever merits the subsidy system has had in the past it has been causing them a lot of headaches recently. They are particularly restive about the financial burden: assistance to be paid out to farmers is even higher than usual this year, enough to make them wonder whether the time hasn’t come to have done with it altogether.
Prices
If therefore Britain does join the Six a rise in food prices seems highly likely. Estimates about this vary from a shilling or two per head per week to something very much more, but the truth is that nobody really knows. One thing is certain, however, and that is that it would provide the Government with a wonderful opportunity to whittle down the effective buying power of wages at a time when the wind of competition within the Common Market was already making the British worker feel chilly.
Agriculture is notoriously a difficult subject to make forecasts about. Governments play about with it and it has always provided a voting lobby sufficiently powerful to make political parties commit themselves to all sorts of peculiar things to win farmers’ support at election times. In addition, until the atomic bomb came along to make the question academic, capitalist governments everywhere have always had some regard for its importance in times of war. The fear of blockade has always been a bogey for them. One can never be certain, then, of what will happen when governments start talking about agriculture and even less certain when a group of their spokesmen get round a conference table to bargain and horsetrade.
A few things can be said, however. It seems fairly certain, for example, that if Britain does go into the Common Market ii will do so at the considerable expense of Commonwealth countries. Present indications are that whilst the Six may how some special consideration for New Zealand, whose economy is almost completely independent upon Britain taking all her meat products and butter, they will have little time for the claims of Australia and Canada who will have to start looking elsewhere for markets for their products. Australia has in fact already begun to do this and is now selling to China and Japan.
Bigger Units
Agricultural interests in France and the Netherlands would gain from this, though Denmark will provide extra competition if she also joins. Italian horticulture will also be given a fillip since the hitherto heavily protected U.K. market seems almost certain to be made more accessible. It is hard to see anything other than a catastrophic effect upon British horticulture, in fact, unless the negotiators bring something remarkable out of the bag. Expensively-heated glasshouses are no match economically for free sunshine and fast transport and can only have their existence in (he mad world of capitalism.
But even more clearly than with industry, the future of European agriculture is going to reflect the inexorable drive of capitalism towards bigger units, mechanisation, and more economic production.
In Italy, 44 per cent. of the population are still dependant upon the land for their living. In France the proportion is 25 per cent. and even in Germany it is 15 per cent. The figure in Britain is 5 per cent.
All these countries are taking deliberate measures to get their peasants off the land and into the towns and factories, though economic forces themselves are probably doing the work more effectively on their behalf. Hundreds of thousands of small farmers are fated to leave their farms in the not far-off future and their land will be merged into larger holdings, revert to its natural state, or be transformed into state forests.
Even in this country the process is still going on. Many small farmers are only able to keep going because of their subsidies from the State. Each year still shows a drop in the number of people getting their living from the land.
The Common Market, therefore, only throws into prominence a process which has been part and parcel of capitalism since its existence. In fact, the Common Market is itself a reflection of this process on the international field. The same impetus which forces firms to amalgamate within a country’s boundaries now forces the countries themselves to look outside their boundaries.
Surplus
But whilst the implications for industry of this process are great, for agriculture they are enormous. That is why all the negotiators at Brussels, whether they belong to Britain, the Six, Denmark, Ireland, or any other country with agricultural interests to protect, are going to talk tough and bargain hard.
And, very much in their minds and hanging darkly over all, is the shadow of surplus. Surplus in a world where half the population live near to starvation and another quarter not very much better.
And that for us is the real dark shadow over all this business of agriculture and the Common Market.
S. H.