Malaya editorial
The bishops have thrown their support to the proposed extension of the Comprehensive Agrarian Reform Law, apparently still believing the worn-out catechism that land distribution is the way to improve life in the countryside. Make every farmer the owner of the land he tills, even if he is reduced to tending a postage stamp-size holding, and he and his family would have enough to lead a reasonably comfortable life.
CARL has been in effect since 1988. The original law expired in 1998, but was extended for another 10 years. The experiment will have spanned one whole generation. Most of the original beneficiaries have died or have become physically incapable of farming their lands.
Assuming they originally got four hectares, to whom will they pass on the land? The eldest son, perhaps, following the feudal principle of primogeniture? Or will they distribute the land equally to their offspring, for an inheritance of one-hectare each based on an average four children per family?
We are not saying that CARL is a failure. But is the price in terms of government expenses in buying the land and of the opportunities lost in failing to fully exploit the productivity of the farms worth it?
Top of the head, we can only come up with a sub sub-sector of land reform beneficiaries who have markedly improved their lives. They are the beneficiaries near urban areas who earned a windfall by selling their holdings to land developers (how long the money lasted is a different question). Then we have the beneficiaries who have contracted out their lands to big agribusiness concerns. These beneficiaries have turned themselves into some form of rentiers, with the resulting production arrangement breeding a new underclass of destitute farm workers.
There are studies showing that about half of CARL beneficiaries have sold their lands because a holding of four hectares or less does not make economic sense. One cannot benefit from economies of scale by investing in farm machineries, high-yielding seeds and fertilizers.
The tendency is toward land re-consolidation, which we expect will speed up as the mandatory holding period for the original beneficiaries ends. The economics of farming demands integration of the small holdings.
We can already see the absurdity of another CARP extension where the newly consolidated holdings from the original redistribution are broken up and re-redistributed anew – with the same cycle repeated a generation hence.
