To observers contemplating the failure of the Cancun ministerial meeting of the World Trade Organization (WTO) in September 2003, the United States and the European Union appeared to stand on the same side of the disagreement that stalled efforts to advance the Doha Round of multilateral trade liberalization. Poor countries wanted real reduction in the widespread agricultural subsidies that depress world prices in commodities that are critical to development. The United States and the European Union, on the other hand, insisted on a more comprehensive approach to liberalization, including pushing the WTO into new areas (such as rationalization of inefficient and corrupt custom procedures). Neither side could agree with the other. But, whereas at Cancun rich countries found a common stance vis-à-vis the demands of developing countries, the United States and the European Union remain on a collision course when it comes to agricultural trade because of the enduring and growing problems associated with the regulation of genetically modified (GM) products.

What do Vidalia onions, Wisconsin cheese, and Kona coffee have that feta cheese, champagne, and cognac do not? The first three products have trademark protection for their brand names (in this case, through U.S. trademark law). The latter three have no brand name protection, but that could change. Protection would become available for the latter products if E.U. proposals to increase protection for products identified as originating from a particular geographic region—so-called Geographical Indications (GIs)—are adopted. The European Union proposes to (1) establish a register of GIs that would give protection to products across international boundaries; (2) extend the protections that are enjoyed by wines and spirits to food products; and (3) allow E.U. member countries to retrieve or “claw back” GIs currently being used by other countries. The first 41 products with GIs that the European Union wants to protect are shown in the accompanying box.

A series of food safety crises, the discovery of bovine spongiform encephalopathy (BSE) in the domestic cattle herd, and a series of labeling scandals in Japan have shaken the trust of Japanese consumers in the safety of their food supply. The Japanese government has responded by implementing a series of new regulations and creating the new Food Safety Commission. The food industry has responded with assurance programs to reduce consumer anxiety over food safety and wholesomeness.

Congress added new programs under the 2002 farm bill to expand the safety net for agricultural producers. Countercyclical payments and marketing loan benefits compensate for low prices. Crop insurance and non-insured crop disaster assistance programs reduce risks from low yields. Direct payments provide income support. But the call for additional support to cover pricing and production emergencies has not subsided. Why?