Here Are the U.S. States That Benefit Most From America's Wacky International Food-Aid Program

The U.S. buys and ships American grains to feed distressed nations. Some charity groups want to change that, but shippers say doing so will cost thousands of American jobs.

People displaced by recent fighting in eastern Congo queue to receive aid food in Mugunga IDP camp outside of Goma on November 24, 2012. (James Akena/Reuters)

When a hungry child in a drought-stricken country gets an emergency bowl of cornmeal porridge, there's a good chance that corn was grown in the midwestern United States, packed into bags, shipped across the ocean on U.S. vessels, and distributed in the disaster zone by an American aid group.

Afterward, the charity organization might even sell some of the leftover corn in a nearby market in order to fund its other programs, like immunizations or maternal clinics.

Most people would agree that it's important for the U.S. to continue its food aid programs, which right now amount to roughly $1.5 billion every year, more than any other country in the world. But there's currently a fierce battle being waged over where exactly that food should come from and how it should be meted out.

On one side, a coalition of humanitarian groups hopes the 2014 federal budget -- which should be announced Wednesday -- changes the current, decades-old system run by the Department of Agriculture so that emergency food would instead be bought in the markets of the country it's intended to help, rather than in the U.S. This, proponents say, will be more efficient (no more shipping food over thousands of miles of ocean), better for local producers and growers, and less disruptive to the food economies of developing countries. According to Oxfam, simply buying these grains from say, Niger rather than Nebraska, would save so much money that aid groups could feed an extra 17 million people per year.

On the other side, some agribusinesses and the shipping lobby wish to keep food aid the way it is, arguing that eliminating the grow-pack-ship steps in the U.S. would cost thousands of jobs in the shipping and farming sectors, not to mention millions and sales and household earnings each year.

This has led to an awkward trade-off: Do we preserve more jobs at home, or do we feed more hungry people abroad?


Here's a look at how the numbers stack up. A 2010 report by the research company Promar International found that the combination of handling, processing, and transporting commodities from farms to U.S. ports, plus the cost of transporting those products to foreign ports, adds up to $1,984,000,000 in output, $523,000,000 in earnings for households, and 13,127 jobs.

Texas would be the most heavily impacted state if we restructured food aid, followed by breadbasket states like Illinois and Iowa and rice growers like Louisiana:


When combined with growers and shippers, Promar estimates that's somewhere between 16,000 and 33,000 jobs we'd lose if food aid was no longer mandated to be grown in the U.S. and sent abroad.

The economic impact could be dramatic for states with large farming sectors, according to 21 senators who wrote a letter to President Obama arguing against a change to the current aid program in February. It was signed by heavy hitters on both sides of the aisle, including Michigan Democratic Sen. Debbie Stabenow, the chairwoman of the Senate Agriculture Committee, and Arkansas Democratic Sen. Mark Pryor, the chairman of the Senate subcommittee that controls agriculture spending.

"American agriculture is one of the few U.S. business sectors to produce a trade surplus, exporting $108 billion in farm goods in 2010," the senators wrote. "During this time of economic distress, we should maintain support for the areas of our economy that are growing."


Meanwhile, charity groups rallying for a change say that the current setup is outdated. In the 1950s, the federal government wanted to boost struggling farmers' profits, so they bought up surplus grain and -- realizing they then had way too much of it on their hands -- decided to ship it overseas to needy countries. And even though the government changed its farm policy in the early 2000s, we're still managing foreign aid the way we did 60 years ago.

The downside? Buying food in developing countries to then give back to vulnerable groups -- displaced people, refugees, malnourished children -- would be much, much cheaper than buying it in the U.S., so aid dollars could theoretically be stretched further. Cereal prices alone are 53 percent lower when bought locally (LRP), versus in the U.S. (transoceanic), according to a paper by three Cornell University researchers:


What's more, buying food locally shaves 14 weeks off the delivery time, which can be crucial during a famine.

"I've run these operations, and I know that food aid often gets there after everyone's dead," Andrew Natsios, who ran the U.S. Agency for International Development under President George W. Bush, told NPR.

Here's a chart from the Cornell study showing how long it takes to get food into various countries according to three metrics: buying locally (LRP), shipping (transoceanic), or projecting how long it would have taken, for shipments that hadn't arrived yet (truncated):


Then there's an even more obscure process called "monetization," in which aid groups sell back some of their extra, Uncle-Sam-given food supplies in international markets in order to raise money for non-food-related development programs they otherwise wouldn't be able to afford.

Here's a graph from the GAO, which estimates that $219 million was lost over the course of three years in the process of selling the shipped-over American food in some far-flung bazar in order to pay for, say, laptops for Kenyan kids:


Aid groups acknowledge that this "monetization" is a rather strange way to get their programs paid for, but most describe it as a temporary hack they've been using in order to carry out their underfunded projects even as international aid dollars continue to be pinched.

"Our foreign affairs budget is always squeezed. The system of monetization grew up out of a desire to do these programs, but we're constrained in our ability to do them," said Eric Munoz, a senior policy adviser at Oxfam, who added that the U.S. is the only country that still does monetization. "This was a workaround that has just outlived its utility."

The question is, will reforming this clunky process seem worth it in the face of potential job losses, particularly in states that are still struggling to recover economically? It's not an easy choice for a federal budget that can only stretch so far.