Approach Three
Open Competition Puts the Markets To Work

Open competition and free trade promises to increase prosperity around the world, while efficiently producing enough affordable food for all people in the long term. Free trade is the cheap and simple way to supply the quality, type and amount of food that people in various countries want. Consumers make ALL decisions in an open and free marketplace. When consumers buy a food product, more of that food is produced and prices go down.

When consumers don't buy a food product, less of that food is produced and prices go up. Over time, open competition in food markets will 'level the playing field' by allowing all farmers to make their own decisions in producing the types of foods consumers really want.

This approach believes in the promise of open markets where people are free to sell and buy food as they choose. No one can be wise enough to manage the global food system-it's too complex. The old 'food aid policy' has failed-it's made countries even more needy rather than encouraging food independence and has actually weakened food production in some developing countries. Global competition and free trade can help people in every country to feed themselves by simply using their own country's natural strengths and resources.

Each country has the land, water, climate, labor force, experience, etc. to grow those products that provide them with a relative advantage in the global marketplace to offer its population the financial means to purchase essential commodities. The natural variety in regional farming assets will provide better nutrition for more people at no additional cost for supervision. This approach wants to put open and free markets to work-they'll get the job done.

Actions in Approach #3 Could Be:

• Eliminate all US farm subsidies and trade barriers that interfere with food imports or exports in a totally open market.
• Change the World Trade Organization (WTO) so it works for the elimination of all agricultural tariffs and export subsidies, particularly among developed countries, and gives equal voting power in WTO decisions to all countries.
• Hold regular meetings of the developed countries to openly discuss free trade goals and food security needs in order to reduce the need for subsidies or tariffs.
• Provide training and startup loans for American farmers who need to switch crops or have to leave farming completely.
• Require accurate and complete reporting on all food packaging including nutrition, country of origin, pesticide use, genetic modifications, etc. so consumers can make informed choices.

Benefits of Approach #3:

• Free trade is totally decentralized and requires no bureaucracy to function.
• On average, American consumers and many agricultural producers will benefit from increased, long-term global free trade in food products.
• A free market is an essential element of democracy. Encouraging its spread will help promote a primary American ideal around the world.

A Tradeoff of Approach #3:

• Elimination of farm subsidies will cause a painful transition in many American communities and higher short-term food prices, but the long-term benefits particularly in the economies of developing countries and long-term decreases in prices will make it worthwhile.

Basic Drawbacks of Approach #3:

• It just won't work, because the developed nations all over the world (including the US) will continue to protect or support their own farmers, while they direct the WTO to demand that developing countries open their own markets to commodities being sold at "supported" prices.
• Many developing countries have little or no experience with a free market system, so their transition period may be long and painful.
  
• Free trade could create so many low-cost food imports coming into the US that American production in some critical food sectors would disappear-this could affect US food security in times of international crisis.

Further Readings for Approach #3: Open Competition Puts the Markets to Work