After the war ended, there was a general interest in reducing tensions between nations. Trade issues are often some of the most contentious. So, in 1947, 23 nations gathered and hammered out a General Agreement on Tariffs and Trade, or GATT.
The goal of GATT was to reduce or eliminate tariffs – the taxes that one nation imposes when goods are imported from another nation. The argument is that the most efficient producer will supply consumers the best products for the least cost when trading systems are free and open.
In its first few years, GATT negotiated 45,000 tariff concessions from its member countries. By 1995, the original 23 nations in GATT had grown to 125. That year, GATT was succeeded by the WTO, the World Trade Organization, which has the same goals but stronger powers to resolve disputes between nations. The WTO has also grown. Over 150 nations are now members or waiting to join.
Yet it wasn’t until the end of its life that GATT even began discussing reducing tariffs and protections on agricultural products. Agriculture had been given an exemption from GATT policies when the organization was set up because so many countries had politically popular subsidies and protections for farmers.
In the U.S., high government subsidies for farming goes back to the Great Depression and the Agricultural Adjustment Act. Farmers were given government support checks if they agreed to reduce the amount they produced. Farm lobbying groups like the Farm Bureau grew stronger in the 1940s in response to threats to government programs.
In the election of 1948, Harry Truman beat Thomas Dewey in large part because he appealed to the farm vote. “The Republicans,” Truman said, “have stuck a pitchfork into the farmer’s back.” He called for a “permanent system of flexible price supports for agricultural products, to maintain farm income on a parity with farm operating costs.”
So, while manufactured goods and even services are now traded freely in much of the world, agricultural products are still supported by various government programs.
In fact, when the WTO was being set up, negotiations over possibly including agricultural products prompted a series of riots by French farmers.
Even well into the 21st Century, it remains an open question how far governments will go in reducing or eliminating protections for farmers.