The global food system is in disarray. Animal husbandry is a major contributor to global warming, and every year up to 12 million deaths from heart disease, stroke, cancer and diabetes are linked to eating the wrong things, such as too much red and processed meat and too little fruit and Vegetables. Until the world succeeds in reducing the amount of animal products in its food system and eating more plant-based diets, there is little chance of avoiding dangerous levels of climate change and growing public health problems.
Agricultural subsidies help sustain a food system that is neither healthy nor sustainable. Globally, more than $ 200 billion in public money (i.e. money that is collected through taxes) is paid out annually in the form of direct transfers to farmers – usually with the intention of supporting national food production and supply.
That may not be a problem in and of itself – after all, we all have to eat. But the way governments are currently providing subsidies is exacerbating the health and environmental problems of food production. This is one of the results of a new study that my colleague Florian Freund and I published in Nature Communications.
Farm subsidies in action
According to our analysis, around two thirds of all agricultural transfer payments worldwide come without any conditions. Farmers can use it to grow whatever they like.
In practice, this means that every fifth dollar goes into the production of meat and every tenth dollar goes into the production of dairy products – foods that farmers are used to producing, but which emit disproportionate amounts of greenhouse gas emissions and which also come from diet related risks such as heart disease and certain types of cancer.
Farmers use another third of these payments to grow staple foods such as wheat and corn, and to produce sugar and oil. These are foods that are already being produced and consumed in large quantities and that should rather be restricted in a healthy and sustainable diet.
Less than a quarter of the transfer payments are used to grow foods that are good for human health and the environment and of which a healthy and sustainable food system needs many more: fruits, vegetables, legumes and nuts.
Based on this breakdown, it is clear that there is much room for improvement in the way governments and farmers give and spend agricultural subsidies. We decided to look for alternatives and compare how they could work in the real world.
Reform of subsidies
We combined an economic model that tracks the impact of changes in subsidies on food production and human consumption with an environmental model that compares changes in resource use and greenhouse gas emissions, and a health model that measures the impact on diet of diseases.
In one scenario we made all subsidy payments to farms dependent on their producing healthy and sustainable food. Farmers could continue to grow other crops and food, just not with the help of subsidies. We found that fruit and vegetable production would increase significantly – by around 20% in developed countries. This would mean that people would eat half a serving of fruits and vegetables each day. At the same time, meat and milk production would decrease by 2% – thus saving 2% of greenhouse gas emissions from agriculture.
However, we also found that if all subsidies were used in this way and workers from more productive parts of the economy were brought into agriculture, the economy could suffer.
Fortunately, there are ways to avoid this. Either make half of all subsidies dependent on the cultivation of healthy and sustainable food, or combine these conditional subsidies with a reduction in the total amount of payments – for example to an amount that depends on the GDP or the population of a country. Any of these options would result in healthier food supplies and fewer greenhouse gas emissions without reducing economic output.
Policy makers in the EU are currently aiming to reduce the environmental impact of subsidy payments, while those in the UK are considering a public-funded public goods approach, where farmers are paid to provide things like clean water, wildlife habitat and a nutritious food supply provide. Unfortunately, such proposals are often watered down when they are implemented.
Our analysis suggests what is largely missing from the current plans: changing the mix of food production. What food farms grow has a greater impact on the environment and health than the way it is grown. Targeting subsidies towards the production of healthy and sustainable food should be an integral part of global agricultural reform.