Urban C. Lehner Editor Emeritus
Poor Japanese Farmer, Poor Detroit

Pity the Japanese farmer. He works inefficient plots averaging only 3.7 acres. He can't expand. The part-time farmer neighbors won't sell and 75% of the country is mountains, with sprawling cities occupying much of the rest. His average age is 70, which makes the 58-year-old average American farmer a frisky pup by comparison.

And now the Japanese government is negotiating a free-trade deal with 11 other Pacific Rim nations, including the U.S., which has just dropped its objection to Japan entering the Trans-Pacific Partnership. Some Japanese farmers think joining the TPP is a pity, too.

Unlike Japan's exporters of cars, consumer electronics and other manufactured goods, which stand to benefit from TPP, the country's uncompetitive farmers are likely losers. If the tariff walls protecting them (examples: 777.7% for rice, 360% for butter) come tumbling down, imports will take an even larger share of Japan's food market and some Japanese farmers will be forced to give up.

But the TPP is only a pity for the uncompetitive. For stronger Japanese farmers, it could be a boon. As the Economist argues (…), the result will be fewer, larger plots and fewer part-time farmers, which will boost Japanese agriculture's competitiveness overall.

More than two-thirds of Japan's 1.5 million farmers are part-timers, the Economist says, and "they tend not to invest and farm badly." If the TPP squeezes them out, professional farmers will buy their land, enabling their operations and the country's agriculture generally to become more efficient. With lots of people and little arable land, Japan will never feed itself. But TPP could improve its food security.

The fight to hang on to high tariffs is led by Japan Agriculture, a national network of farm cooperatives with 240,000 employees across the country. JA is, some think, the Japanese equivalent of the National Rifle Association -- the nation's most powerful lobby. Between concerns about food security and pressure from JA, Japan's TPP negotiators will do everything they can to limit ag concessions.

How hard will U.S. negotiators fight to extract those ag concessions from Japan? If that seems a strange question -- "Of course they'll fight hard," you might think -- consider our domestic TPP politics.

American farm groups welcomed the prospect of a TPP deal with Japan. Japan is our fourth-largest ag-export market. The U.S. sold Japan $14 billion of farm products last year and will sell more if TPP lowers tariff and non-tariff barriers.

But the squeaky wheel U.S. negotiators have to grease is Detroit. Note well that Debbie Stabenow is threatening to vote against a TPP deal even though she chairs the Senate Agriculture Committee. The Michigan Democrat's statement on the dropping of the U.S. objection (…) doesn't mention the state's cherry farmers or any farmers; it's all about autos.

"For decades, Japan has implemented egregious barriers that have blocked the import of American automobiles," she said. "Any agreement that allows Japan's businesses to continue to play by one set of rules while ours are forced to play by another will cost us jobs and I will do whatever I can to stop it."

You have to wonder: When push comes to shove, when tradeoffs must be made and half-loaves accepted, which of Japan's protectionist barriers will our negotiators fight harder to bring down: agricultural or automotive?

Maybe we needn't pity the Japanese farmer so much after all.


Posted at 3:50PM CDT 04/15/13 by Urban C Lehner