Later today Stefan Tangermann will step down as Director of the OECD Trade and Agriculture Directorate, a post he has held since 2002. The OECD has a strict ‘retire-at-65’ rule and it may surprise some to learn that the tall and spritely German, invariably sporting one of his trademark bow-ties, has reached such an age. Professor Tangermann has been a colossus among European agriculture policy analysts for at least two decades. Before taking the job at the OECD he was professor of agricultural economics at the University of Göttingen, having been appointed to that position in 1980.
He is probably most famous for the ‘bond scheme’ for CAP reform – under which a future stream of entitlements is converted into an attractive lump sum ‘buyout’ – that he devised in 1991 and subsequently elaborated with Professor Alan Swinbank of Reading University. Two weeks ago he gave a presentation at the European Commission’s conference on the future of the EU budget. He presents a succinct summary of why CAP reform is still very much needed, and what direction reform should take. He did not advocate any particular exit strategy from direct payments such as converting subsidies into tradable bonds. Perhaps once he has freed himself of the constraints of being an OECD employee he will advocate his own personal vision on how bring political economy and agricultural economics can be combined to achieve a more rational European farm policy. You can watch the presentation in full below.
Chapeau, Stefan! Enjoy your freedom but please don’t give up on the battle for CAP reform. Europe needs you!
1 Reply to “Tangermann’s parting shot”
I guess that most people interested in CAP will agree with Stefan Tangermann that the future of direct payments will be the crucial issue for CAP reform in the context of the EU budget review. Three concepts are mentioned in this context in the presentation:
1) Targeting, 2) Tailoring, and 3) Renationalisation of Ag Policies.
No doubts about the need of overall budget reduction (#2 in the list). However, I think that there is a tension between “Targeting” and “Renationalisation”. Renationalisation of those parts of the CAP which do refer to local public goods would reduce in many areas the need for improved targeting of EU measures simply because these are put back under the responsibility of individual member states. Renationalisation is for the larger part a substitute for, not a complement to Targeting.
Tangermann points out that many measures which are financed today via the EU budget are essentially measures for redistributing money between member states. This, however, applies even stronger to the targeted portion of CAP payments, i.e., 2nd pillar payments. Hence, I would fear that any move towards better targeting of pillar 2 policies at the EU level will inevitably be mixed up in the EU policy process with the redistribution objective — I would not expect too much from the outcome of such a process.
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