An Urban's Rural View

There's an old joke -- you've probably heard it -- about cows and political systems. One of its many versions goes like this:

-- Feudalism: You have two cows. The nobleman takes some of the milk.

-- Communism: You take care of two cows. The government takes all the milk.

-- Capitalism: You have two cows. You sell one and buy a bull.

I bring up this joke not because it's terribly funny. It's a morsel of irony, and irony evokes smiles more than guffaws. I mention it instead because there's a new twist on it today in Eastern Europe. This twist is especially not funny:

-- Crony Capitalism: You used to have two cows but the government sold them to someone else without you knowing about it.

In reality, it's no joke. Countries like Hungary, Bulgaria, Slovakia and the Czech Republic are selling off farmland to friends of rulers, who then collect generous European Union subsidies. Actual farmers have little opportunity to bid on this land.

We know all this thanks to the New York Times, whose reporters spent the better part of a year investigating it. According to their deeply disturbing account, political leaders of Eastern European countries are "milking the EU for millions" and engaging in "Mafia-style land grabs." (https://www.nytimes.com/…)

The EU doles out $65 billion a year in farm subsidies. It's an astonishing number when you look at it in perspective. Farm subsidies are the largest line item in the EU budget, representing some 40% of total outlays. That $65 billion is more than twice the subsidies American farmers receive even though the EU's farmed acreage is less than half ours.

Why does the EU lavish such sums on farmers? The Times explains that the subsidy program does more than support farm incomes; it "helps hold a precarious union together." Says the Times: "European leaders disagree about many things, but they all count on generous subsidies and wide discretion in spending them."

During the Communist era, Eastern European farmers worked fields they had once owned before their governments took them and collectivized them. After the fall of the Soviet Union, these countries embraced capitalism and were admitted into the EU. They put their large holdings of farmland up for lease or sale.

The buyers, in the Times telling of the story, weren't farmers. Sometimes farmers weren't even told that plots near them were for sale. The land, now more lucrative than ever thanks to the EU subsidies, went to friends of the countries' rulers -- cronies -- and often on favorable terms. In the Czech Republic, the prime minister's companies collected $42 million in EU ag subsidies last year.

In Slovakia, "Small farmers have reported being beaten and extorted for land that is valuable for the subsidies it receives," the Times writes. "A journalist, Jan Kuciak, was murdered last year while investigating Italian mobsters who had infiltrated the farm industry, profited from subsidies and built relationships with powerful politicians."

Farmers who complain faced retribution. In Hungary, "Ferenc Gal, who raises cows, alfalfa and a few pigs on his family farm, said he applied to lease about 320 acres because the European subsidies alone would have made it profitable before he even planted anything. Local farmers were supposed to get preference, but the land went to wealthy out-of-town investors.

"When he complained, he quickly found himself a pariah. He said government inspectors showed up at his farm, suddenly concerned about environmental and water quality. He said local officials told him not to bother applying for future rural grants."

Why does the EU put up with this? Why does it defer to local leaders even when there's evidence of corruption? Because, the Times says, every country benefits from the subsidies and no country wants restrictions on how it doles them out. "Bucking that system to rein in abuses in newer member states would disrupt political and economic fortunes across the Continent."

But by tolerating that system, the EU is helping Eastern Europe's increasingly autocratic rulers entrench themselves in power. The EU prides itself on being "founded on the principles of liberty, democracy, respect for human rights, fundamental freedoms and the rule of law." (https://ec.europa.eu/…) Unfortunately, the increasing misuse of the EU's farm programs is making a joke of these principles.

Urban Lehner can be reached at urbanize@gmail.com

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