Financing the Farmers

Perhaps the most persistent problem confronting Common Market negotiations has been how to collect and pay out huge sums for farm subsidies among the Market's six nations as they unify their agricultural systems with common prices behind a common tariff. Indus trial West Germany was, for obvious reasons, reluctant to agree on high farm subsidies. And farm-rich France was not about to agree to anything that might deprive the French farmer of so much as a sou.

There the deadlock stood -- until last week, when Common Market ministers meeting in Brussels finally agreed on a plan that will go into effect in 1968 and pay up to $1.5 billion annually to French wheat growers, Dutch dairy men, Italian fruit and vegetable farmers, and Belgian beet-sugar producers to subsidize their exports. France will collect 40% to 45% of this total. Funds for these payments will be raised in equal parts from duties on farm imports from outside the Common Market and from payments by the treasuries of the Six, in a proportion of 32% from France, 31.2% from Germany and lesser amounts from the others.

In the package settlement, the French let go of a lever that they had used to pry the farm deal out of the Germans, who want free exchange of industrial goods among the Six. The French agree to drop the remaining 20% tariffs on such goods by July 1, 1968.

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