Even before the First World War (1914–18), there were a number of instances when surpluses of agricultural products arose beyond market demand. Governments intervened to protect farmers’ incomes and to provide food aid to needy countries. The first major food aid operations evolved from the special post-war relief credits voted by the US Congress for the period between the signing of the Armistice in 1918 that marked the end of the First World War and the signing of the Treaty of Versailles in 1919, and then for the so-called reconstruction period in Europe from 1919 to 1926, when a total of 6.23 million tons of food was shipped. The importance of this US initiative lay not only in the quantity of relief provided. It established the precedent for operations of this type involving prominent personalities, the most significant being President Herbert Hoover, and brought a general realization of the value of food aid as a politically stabilizing factor. Agricultural surplus problems after the Second World War (1939–45) had their genesis in the 1920s and 1930s. With the end of the special credits for agriculture in 1926, and with the United States still producing considerable surpluses of cereals, moves were made to formalize the type of food aid arrangement started in 1896 by the US Department of Agriculture. During this period, incomes from agriculture fell drastically, in absolute terms as well as in relation to that of other sectors of the national economies. Governments everywhere intervened to bolster farm income. In the exporting countries, intervention usually took the form of government or quasi-government marketing boards with monopoly powers. In the importing countries, it mainly took the form of new devices for the control and redistribution of imports, such as quotas, regulations and preferential and bilateral trade arrangements. Government interventions in the importing countries had the effect of stimulating domestic production and of reducing the demand for imports of some agricultural products. But interventions in the exporting countries did not, in general, lead to a reduction in exportable supplies. Thus, in the late 1920s, excess stocks started to accumulate and world prices fell to very low levels.
World Food Problem in Global Political Context: Towards a Universal Food Policy
