Thailand’s Rice Subsidies a Copycat Boondoggle the Junta Condemed in the 2014 Coup

Ms. Yingluck’s program attempted to manipulate the global rice market by paying farmers 50% above market price for their crops and then storing it to raise prices. This backfired when India and Vietnam filled the global shortage and knocked Thailand from its place as the world’s top rice exporter. The Thai government was left with some 18 million metric tons of rice, more than $15 billion in losses and no money to pay farmers.

The new rice program announced by Bangkok’s junta this month will give farmers a loan on still-unspecified terms rather than pay them outright. It will also have farmers store their own rice (with government assistance), rather than store it in government hands. But otherwise the plans are essentially identical.

The military is following its old nemesis into the rice-subsidy business because farmers are some 40% of the Thai population, and most of them plant rice. For the past 15 years, Thailand’s rice-growing north and northeast have supported the Shinawatra family, ensuring that their parties have won at every general election. Now the generals are bidding for their votes.

That may help the regime peel away votes for elections scheduled next year. The larger danger to them is that this scheme has as much chance of succeeding as the previous one, even if the subsidies are described as a loan. The generals won’t prosecute themselves on negligence charges the way they did Ms. Yingluck, but popular reaction to another self-inflicted economic debacle could be fierce. That would be a tragedy for all Thais, brought about by predictable economic farce.

Source: WSJ