The Common Agricultural Policy
The Common Agricultural Policy (CAP) seeks to provide an internal market and common prices for agricultural products. It is distinctive amongst EU policies in its complexity, conflicting objectives and status as a ‘cornerstone’ of the EU. The CAP accounts for large shares of both EU decision-making and spending: about half of the Community’s budget, down from a staggering 87 per cent in 1970. Yet agriculture now accounts for only about 2.5 per cent of the Union’s gross domestic product (GDP).1 The CAP is blatantly regressive: it results in food prices that are about 8 per cent higher than in the United States (USA), with the burden falling most heavily on the poorest consumers. Roughly 80 per cent of the CAP’s benefits traditionally have accrued to 20 per cent of the EU’s (richest) farmers. Why such an elaborate, tortured and controversial policy for such a relatively marginal sector of the EU’s economy? There is no simple answer to this question, although this chapter, more than any other in this book, tries to simplify much that is very, very complicated (see Table 5.1).
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