Farmers for economic freedom
Updates from the Canadian Farm Enterprise Network, Canadian Farmers for Justice and the Prairie Centre. Several of the items appearing here originally appeared in an email list operated by Dwayne Leslie at http://www.prairielinks.com.
web posted August 21, 2000
What did Ritter see?
By Craig Docksteader
When Ken Ritter walked into the Canadian Wheat Board after being elected to the CWB board of directors in 1998, he was a firm believer in voluntary marketing. But before he could finish the first half of his two-year term, he had become one of the monopolys biggest advocates.
Somewhere between these two points in time, something changed Ritters mind. Something persuaded him that forbidding producers by law from marketing their own grain was not only justified, but essential. Regrettably, well probably never see what this was. Ritter himself never saw it until he was given access to top-secret CWB information.
Oddly enough, although the CWB says it has the information to settle the monopoly question once and for all, they refuse to do so. Instead, they let certain people who are pre-approved have a peek at the books. For the rest of us, the numbers and stats are a deep, dark secret that cant be let out of the building even after 20 or 30 years.
In poker, we call this bluffing. The CWB claims to be holding a winning hand, but farmers arent allowed to call them on it and see their hand. All they see is the money thats left in the pot at the end of the game every year. And all too often the final take leaves many unconvinced.
But if the cards were ever put on the table, we might find that the CWB has been telling the truth -- or at least part of it.
(1) It is possible that the CWB can extract premiums in select markets when the buyer insists on Canadian wheat. Japan is often touted as a buyer that is willing to pay a little more for good-quality Canadian wheat. Perhaps CWB staff flashed a few of these premium contracts in front of Ritter, wowing him with their sales finesse.
What they probably neglected to mention, however, was that the monopoly prohibits individual producers from collecting on hundreds of other premium niche market opportunities every year. The cumulative value of these lost sales are never included in the equation when were told how good the monopoly is for prairie farmers.
(2) The CWB claims that it would not survive as a voluntary marketing agency. This is their trump card -- most producers want dual-marketing, not open marketing. Undoubtedly CWB staff played it for Ritter and he folded. But the fact is, the CWB is bluffing on this one. As the wheat pools demonstrated in the 1920s, and smaller marketers continue to demonstrate today, you do not have to be a grain handler in order to be a grain marketer.
Perhaps the CWBs concern is better explained by its own public opinion polls which show its popularity slipping with farmers. If the CWB cannot survive in a voluntary environment it will be simply because it is not good enough to earn farmers business without the force of law.
(3) Apparently CWB customers like the CWB. There are a number of studies in existence which demonstrate that this is probably true. CWB staff might have hooked Ritter up with a few of these customers and let them gush all over him. Perhaps the favorable impression caused Ritter to miss the fact that anyone who wasnt happy with the CWB wouldnt be doing business there, and that eighty percent of the world shops somewhere else for their wheat.
Whatever Ritter discovered in the CWB board room is a secret. But it wasnt what Ritter saw that made him change his mind on the monopoly anyhow. It was what he didnt see.
web posted August 7, 2000
Challenging the status quo
By Craig Docksteader
Without question, it's a difficult time to be farming on the prairies. Prices are low, weather uncooperative, inputs high, yields erratic, and markets sluggish. There are few people who would say its a good time to get into grain farming.
It's at times like this, that people start asking questions. Why are things the way they are? How did we get here and how do we get out of here? Old positions are challenged, and there is an openness to new ideas.
Following are a number of such questions which are regularly surfacing from producers who are no longer content to simply think "inside the box".
(1) If the CWB monopoly protects prairie farmers from low prices, why is the price of wheat where it is?
(2) If the Canadian Wheat Board monopoly is as good for producers as the government says it is, why don't we have a similar monopoly on other agricultural products?
(3) Why aren't growers of canola, rye, oats, flax, lentils, canary seed, mustard, chick peas, sunflower, safflower, soybeans, corn, millet, field peas, wild rice, and alfalfa hammering on the door of Parliament insisting that these commodities be brought under a government monopoly like the CWB? Is it possible that either the monopoly is not necessary for successful marketing or the grassroots support for monopoly marketing boards is a lot lower than we are led to believe?
(4) If allowing producers to market their own wheat drives down the price, why are many markets for non-board commodities profitable?
(5) On what basis can monopoly advocates claim that the CWB gets a better price for wheat than individual producers? Today's prairie producers have never had access to world wheat markets.
(6) Why do monopoly advocates claim that wheat cannot be successfully marketed without the CWB monopoly and yet they successfully market non-board commodities on the open market?
(7) If, without the CWB monopoly, producers would be eaten alive by grain companies and railways, why is it possible to grow other commodities and make a profit without a government-sanctioned monopoly? Producers of non-board crops should have been ruined by unscrupulous grain merchants long ago. Instead, interest in growing such commodities is expanding. Why?
(8) If multi-national grain companies are able to manipulate the price of wheat, how come the CWB can't do the same? It's one of the biggest grain companies in the world.
(9) If multi-national grain companies are able to manipulate the price of wheat, why did the wheat pools fail when they tried to do it in the 1920's? And why, then, would any major grain company ever post a loss?
(10) Why would multi-national grain companies manipulate the market to depress the world wheat price when they themselves would then have to sell their wheat stocks into that same depressed market?
To some, these questions may seem offensive because they challenge the status quo. But in reality, they are simply the result of objectively examining what many producers once took for granted.
web posted July 31, 2000
The missing track record
By Craig Docksteader
In a matter of weeks, the campaign to elect farmer directors to the Canadian Wheat Board will begin in earnest. Five directors in even-numbered districts are up for re-election and are likely to begin campaigning as soon as harvest wraps up. The successful candidates will take office on December 31, 2000 and hold their board position for four years.
The contest could prove to be interesting. Unlike the election in 1998 where all the directors were new and nobody knew what to expect, the dynamics have changed significantly.
This time the existing CWB directors have a track record to defend. As the incumbents, it's not just a matter of explaining their policy position on issues, but farmers will want to know what they did for the two years they were in office.
In most elections this poses little problem. The candidate simply points to his or her voting record, party platform and public statements that constitute the public record over their term of office. On the merits of what they have or have not done, the voter is able to figure out if the candidate deserves their vote, or if someone else more closely represents their position.
But it won't be quite this easy with the CWB election. Since the CWB likes to keep its activities secret from farmers, assessing the performance of individual directors is impossible. Unlike a parliamentary election where elected representatives openly debate the issues, the CWB board debates and votes in secret. Once a decision is made, the board likes to present a united front to prairie farmers, muzzling any dissident directors by encouraging them to present the board's position and keep their personal viewpoints to themselves.
This means there's no public record to demonstrate where the directors actually stood on the issues when they were in the boardroom. Whatever was discussed and whatever individual positions were taken are secret. On at least one occasion -- concerning the Prairie Pasta Producers -- the directors chose to make a significant policy decision on the basis of a secret ballot. They didn't even want each other to know where they stood on the issue, nevermind having farmers know.
In many ways, Ken Ritter, chairman of the board of directors, typifies how the system works. Elected in 1998 as a director who believed the CWB should be voluntary, Ritter quickly changed his mind once he was in the board room. Apparently, after taking a look at some secret CWB information, Ritter went back on everything he told producers, and endorsed the government-imposed monopoly.
This now puts Ritter in a bit of a predicament. He can't ask producers to vote for him on the basis of his boardroom track record because it's a secret. But he also can't credibly appeal for support on the basis of his policy positions. He's already demonstrated that they could be subject to change when he sees the next set of secret numbers. He can't even show the numbers to producers because of the CWB's acute anxiety over "commercially sensitive information". This means his campaign has been reduced to the age-old paternalistic appeal, "Trust me."
As the incumbent directors will find out, the political landscape of prairie agriculture is changing. Many producers are increasingly dissatisfied with electing someone to do a job they would rather do themselves. But if, for the time being, they have no option but to elect someone, that individual should not only be prepared to say what they'll do but then be able to demonstrate that they did it.
Craig Docksteader is Coordinator with the Prairie Centre/Centre for Prairie Agriculture, Inc. "Where Do We Go From Here" is a feature service of the Prairie Centre.
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