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10 Aspects of the Food for Peace Modernization Act

Food for Peace Modernization Act
The Food for Peace Modernization Act (FPMA) is a bill currently awaiting a vote in the House of Representatives in Congress. This bill would change the way the United States can provide food to countries in need; here are some crucial factors of such a powerful piece of legislation.

10 Aspects of the Food for Peace Modernization Act

  1. Currently, only 30 percent of Food for Peace funding actually pays for food. The other 70 percent has to cover overhead and transportation costs for inefficiencies in the current law.
  1. It is a bipartisan bill. FPMA has support from both Republicans and Democrats. It has great support from Senator Bob Corker, a Republican from Tennessee and Congressman Earl Blumenauer, a Democrat from Oregon.
  1. It will help Americans aid impoverished countries even more. This change in policy will make it possible to feed at least 9 million more people across the world without spending any extra money. If more money goes towards the food aid rather than the overhead costs, the United States will be able to feed substantially more people in need at the same cost.
  1. It will change where the United States can source and ship the food from. The bill currently mandates that almost all food aid must be from the United States. This would change from almost all the food to no less than 25 percent of the food coming from the United States; this means that up to 75 percent of food aid could be sourced in locations other than the United States. Food could then be locally sourced much closer to the population that needs the food aid, which would save the U.S. money and time.
  1. The bill will eliminate monetization. Monetization is the act of giving funds to non-governmental organizations that operate development programs in other countries to buy food from the United States, ship that food to a poor country and then resell it in local markets. The act of monetization wastes about 30-50 percent of every dollar spent on shipping and administrative costs. This process can also depress local food prices, eventually negatively affecting local farmers and the food security of the country. The Food for Peace Modernization Act would eliminate this practice, thereby making it easier and more effective for the United States to aid poor countries.
  1. It will speed up the process of delivering food aid, which will save millions of lives. By the United States locally sourcing food for aid-recipient countries, the nation will dramatically reduce its aid-delivery time.
  1. American ships won’t have to carry the food aid. Shipping on American vessels costs about one-third more than using other means of transportation. If this step was not required, the money the United States could save would be able to help more people in dire need of food aid throughout the world.
  1. The United States Agency for International Development (USAID) has the opportunity to be more flexible with payment for their food aid. FPMA will allow USAID to be able to use vouchers or cash transfers for 75 percent of all food aid. USAID will be able to decide which is more cost effective, and which will help save the U.S. an abundance of money and help more people in need of aid.
  1. Food aid makes up only 0.2 percent of United States Agriculture Production. Although FPMA would change the requirement of almost all food aid coming from the U.S. to no less than 25 percent, it would have almost no effect on American farmers. The significance of American farmers is still recognized, but sourcing less food from the U.S. would not affect the production of these farmers since food aid is such a small part of American agriculture production.
  1. The current restrictions of food aid are estimated to waste about $400 million each year. The inefficiencies in the current bill waste a great deal of American money each year. With these changes like eliminating monetization, allowing vouchers and locally sourced food and not shipping all food aid on American vessels as introduced in the Food for Peace Modernization Act, the United States could use this money to help many more impoverished people around the world in need of food aid.

Spreading the Wealth

The United States is the largest contributor of food aid in the world. If the Food for Peace Modernization Act passes, it will allow the U.S. to help even more people in need across the world at no extra cost.  

– Ronni Winter
Photo: Flickr

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The Impacts of the Food For Peace Modernization Act

Food For Peace Modernization Act
On March 14, the Food For Peace Modernization Act (H.R. 5276) was introduced on the House floor. Though this bill has not received much attention from the media, it is an important piece of legislation that could have a drastic impact on global food insecurity if passed.

The Food For Peace Modernization Act

The Food For Peace Modernization Act is a bipartisan bill introduced by Senator Bob Corker (R-TN) and Senator Chris Coons (D-DE) in an effort to reform the Food For Peace program, which was originally signed into law by President Eisenhower in 1954. The goal of the program is to deliver healthy food to people all over the world who suffer from malnutrition.

Since its creation, the Food For Peace program has provided aid to over 3 billion people and is widely considered a success; however, lawmakers now address that the effort hasn’t yet reached its full potential.

As it currently stands, the law requires that all food used for foreign assistance purposes has to be produced in the U.S. While this may sound like a good way to promote American farming, it is an extreme burden for the Food For Peace program. Due to the costs incurred by transporting all of the food overseas, only 30 percent of the program’s funds are spent on actual food.

The Food For Peace Modernization act seeks to change this aspect of the law. Instead of requiring 100 percent of food products to be made in the U.S., the revised version of the bill drops this number to just 25 percent. This would mean that the majority of food can be derived from within the countries the program is trying to assist.

The Monetization System

Another part of the law the Food For Peace Modernization Act hopes to alter is the “monetization” system. Currently, NGOs are required to take food which was donated to them by the U.S., sell it in overseas markets, and use the profits to fund their food insecurity programs. However, this process often negatively affects the communities in which the food is sold because it forces local farmers to drive down their prices in order to compete. The new version of the bill (S. 2551) would eliminate this requirement.

Not only will these revisions allow more money to be spent on actually feeding the hungry, it may also boost the economies of the local food markets in impoverished countries and ultimately decrease their dependence on U.S. assistance — all at no extra cost to the American taxpayers.

Overall the hope is that, if passed, the bill will redirect the focus of the Food For Peace program to be on the people who need assistance, rather than the business ventures of U.S. corporations.

Representative Ed Royce (R-CA-39) captured this sentiment in a statement to the House Foreign Affairs Committee stating, “Just as aid can’t be an entitlement for those overseas, it shouldn’t be an entitlement here at home. This includes food aid, which for too long has been treated as an entitlement for a handful of shipping companies rather than as a humanitarian program meant to save lives.”

– Maddi Roy

Photo: Flickr