The Evolution of Canadian Farm Income Stabilization Policy Continues

It is that time of year again, when I pull my machinery out of the shed. There are always a few surprises, with much depending on the condition of things when I put it away last fall. The fall of 2018 was incredibly difficult because of the harsh weather as well as the DON outbreak in Ontario corn. My combine started up in good order, with many of the vestiges from last fall still apparent on its exterior. The corn planter was in behind, so is a very necessary exercise to get things rearranged.

One thing that makes farming an interesting profession is the different tasks we need to become experts in. For instance, I dragged out my corn planter and I’m supposed to be an expert on what it does. At the same time I was rearranging my combine and of course I supposed to know what it does. Needless to say, in between I had problems getting older tractor started and a host of other mechanical issues, which I am supposed to know how to take care of. At the end of the day, it’s all my responsibility so for better or worse over my career it’s a never-ending process.

Of course, much of this comes with age. I turned 60 in January, which puts me on the mature side of the ledger. Interestingly enough, a few years ago I had a younger mechanic come out to help me with a piece of equipment. He got underneath the sprayer and I quickly got underneath their with him, hoping to help him out. It was funny his reaction. He looked at me and said, Phil its no problem I can do this. He went on to say, Phil, you are an older farmer; you actually change your own oil!

That was no insult; it was simply his commentary on what he sees in the repair shops throughout farm country. Apparently, the younger guys don’t do so much of that anymore. I don’t know, maybe it’s not such a bad idea. I really dislike changing wheel bearings. It usually involves a lot of grease. I’ll just leave that there. I think you get the picture.

Interestingly enough, being more mature means more things than changing your own oil, fixing your own tires or changing wheel bearings. I got a note from a Saskatchewan farmer over last weeks asking me to explain to him Eastern Canadian farm safety net demands. He is a younger fellow who is very involved in Western Canadian farm groups but really doesn’t have a good idea about the income stabilization policies espoused by Ontario and Québec over the last decade or so. He asked me to fill him in on that. So perhaps as a more mature person, who at one time was at the vortex of farm protest in this country I thought I might give it a try.

The short version is Ontario at one time had GRIP and NISA, which were the pillars of Canadian farm income stabilization. NISA was the Net Income Stabilization Account, which existed between 1984 and 2009. Farmers were able to invest 3% of their eligible sales into an account and have that matched my government. This was meant to be a savings program for farmers to use in periods of reduced income; GRIP was a revenue insurance program, to help stabilize farm revenues. They were incredibly popular at one time in Eastern Canada. The Liberal government of Jean Chretien changed these programs, with Ralph Goodale and others being largely responsible. Along came the CAIS program to replace some of these programs, which is now Agri-stability. Agri-Invest was later added in 2008, which was a very dumbed down NISA program. Ontario farm groups have been fighting to get revenue insurance back ever since and the elimination of margin based programs like Agri-stability.

There is not much left of these policies anymore. In fact, in these pages over the last 10 years I’ve said that it is a shambles, which I’ve always found very troubling. I found a troubling because I believe farm income stabilization is very much needed and eventually we will need that again. However, over the last 12 years, the earth moved under our feet. Both the political landscape changed as well as the agricultural economic landscape. The ethanol boom and the rise of China helped to get us better prices. All of this had the effect of taking the political expediency to get better farm income stabilization programs away. One result of that is younger farmers don’t realize the sacrifice that was made amid the protests 13 and 14 years ago to get better farm income stabilization policies. So my friend from Saskatchewan can be excused for not knowing. There are many Ontario and Québec farmers, who don’t know any different either.

At the present time, we know that China has pulled back on their agricultural demand for North American agricultural commodities. At the same time, the ethanol regulations in the United States (RFS) have been severely compromised resulting in reduced corn demand. It’s resulted in lower prices and it’s also resulted in a greater need for farm income stabilization. In Canada, that almost seems like a pipe dream now. Meanwhile, in the United States, farmers received market facilitation payments for crops hurt by the China trade action. In Canada, will know none of that was here.

Remember, I’ve led a few protests back in the day, but I also change my own tractor oil. The challenge ahead is for more youthful leaders to take up this fight. It is surely already happening, with Ontario and Quebec farm groups pushing the envelope. Time marches on, but the need for agricultural stabilization policies will never go away. The evolution of that continues.