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Limiting US Food Aid

April 26, 2014

foodaidAfter much celebration of a loosening of US food aid regulations last year, we now appear to be moving in the opposite direction. About a year ago, President Barack Obama proposed reforms that would have effectively made US food aid programming more efficient, removing restrictions on requiring that US food aid be shipped on US flagged vehicles, ending the practice of monetizing food aid, and increasing the proportion of food aid provided in cash relative to the proportion provided in-kind. These reforms would have increased the amount of food aid the United States could provide by up to one-third without increasing the food aid budget at all.

But a provision tucked into a Coast Guard spending bill could undermine much of the progress promised by President Obama last year. The provision—already passed by the House and currently under consideration in the Senate—would increase shipping requirements for US food aid. Currently, federal law requires that half of US food aid be shipped on US flagged vessels. The new provision would increase the requirement to three-quarters.  The changes would both increase the cost of food aid shipments (thereby lowering the total amount of food aid that could be provided) and cause longer shipping times (thereby slowing the ability of the United States to respond to emergency situations).

The Obama Administration has worked to oppose the new requirements, noting that they would prevent aid from reaching up to two million people per year and would add $75 million to the annual cost of US food aid programming. Several international organizations, including Oxfam and the World Food Program have lined up in opposition to the measure. But the measure enjoys strong support from the shipping industry lobby, who maintain that the requirement helps to protect American jobs and bolster the country’s merchant marine, thereby contributing to national defense.

It’s always been clear that the primary beneficiary of US food aid has always been American farming and shipping interests. But the proposed reforms clearly illustrate the trade off involved here.

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