Book Review - Food Fights over Free Trade, Christina L Davis

“Farm Politics” – despite having studied trade for a while, it struck me when I saw this phrase how complicated, twisted and ironical agricultural negotiations can be, and this phrase “farm politics” seemed to sum it all up. A progressive reduction in agricultural subsidies will have an almost immediate impact on poverty elsewhere and like a senator put it “can mean life and death somewhere across the world.” The book has a thorough lay down of facts, evidence, arguments as well as a humanitarian face to things. I found the book “Food fights over free trade” a tough book to plough through initially, but one that leaves you feeling like you understand the political, economic and diplomatic complications of agriculture much better.

Davis’ argument on cross sector issue linkage- especially that between agriculture and industry can be weighted as successful if the linkages are highly correlated, then one can be effectively weighted against the other. But agriculture has always been a sector that lobbies independent of other sectors and it’s very hard to find a sector linkage strong enough to be compromised for decade-long agricultural subsidies, and you see how most agricultural negotiations end up being bilateral or a single issue negotiation. The “politics of negotiation” is captured in the agricultural sector as it captures the sentiment of the general public and are large vote-banks. Therefore the sector has a lot of political leverage. At the negotiating table nobody is benevolent- if you can give them incentive enough to switch, they will. But as in the case of most negotiations- a little crack of light needs to be found in order to further expand the scope of agricultural negotiations.

When looking at the course of trade negotiations through history- it is evident that the WTO’s organizational structure, its enforceable authority, and its various dispute settlement bodies, and their use of reputation costs to deter violators has worked better than the GATT system. By signing in as a member of the WTO domestic governments are tying their own hands against passing unilateral trade policies and changing existing tariffs. (EU in the hormone beef ban case violated this and could not do this for long) If not for this international carrot and stick policy- each time an industry lobby favored government party comes into power that industry would expect to get protected through tariff or non tariff barriers. A tangent to the argument about collective action problems is that of lack of awareness of the WTO redressal process and lack of communication of importers to their respective government agencies of countervailing or antidumping.

The US market size allows for a great deal of autonomy and bargaining power at the table- but sometimes the US is on the receiving end, as in the case of China. China refuses to revalue the Yuan despite immense pressure from the US government. This is because for one, the US is not China’s biggest importer, therefore the US does not have the “monopsony power in trade” Second, the huge number of dollar reserves that the Chinese government holds can cause serious currency value fluctuations if they decided to sell. It goes to prove that all negotiations have power and interests, both of which change over time and therefore need to be reprioritized as the balance of power and interests change between the parties involved.

A key summary of the issue, though can be easily missed, is the assumption of the state being a unitary actor- this means that domestic concerns should not theoretically play a part in international trade laws. Its failing, in cases like the Diet in Japan’s vehement opposition of importing “one grain of rice” – ultimately goes to say, we understand that the assumption of unitary actor does not hold. With strong international pressure in the Rice ban, hormone beef ban as well as CAP, it is fascinating to see how ultimately domestic interests “aggregate” towards liberalization and equilibrate the market.

The author also chronicles some significant but smaller incidents in the midst of negotiations such as the US bashing of Clayton Yuetter- him having rejected the US farmer petitions twice over, on grounds of straining US-Japan relations. Those on the forefront of such diplomatic talks realize how seemingly “right” it would have been to accept the petition but that would’ve made it so much easier for Japan to have shut itself off from negotiations all-together. Having come from India, a country where there are bilateral negotiations all the time with Pakistan, you realize how one comment or seemingly “right” decision to you might be a very sensitive issue for the other party in the negotiations- leading them to turn hostile. At the end of each of his chapters/parts the author gives us empirical evidence to make clear which of the negotiating structures or hypotheses have worked in the real world.

The conclusions of the book lie modest, yet insightful – the difficulties of saturation of cross sector linkages, where nothing in the newer industries can entice the countries to come to the table is a very pertinent difficulty in the long run. Adjudication is increasingly seen as a means to settle trade disputes, yet it can’t work always, and there must be a negotiating structure formulated to the specific circumstances. The formations of G-20’s G-8’s to resonate the developing country voices is a good proposition for the success of the Doha round. It is also dangerous – the combined bargaining power might lead to failed talks repeatedly and negotiations increasingly move towards bilateralism, which is not in-line with the WTO consensus approach. Multistage negotiation analysis gives us an understanding of how exactly to structure negotiations – first, a series of bargaining or should they raise only easy issues in the GATT rounds?

The strategic and negotiation studies of international relations, comparative politics and sometimes a long drawn out series of interests and threats are necessary to tip the balance and solve any issue as complex as agricultural issues.