ABSTRACT
All advanced economies protect their agriculture sector. The EU is no exception. The common agricultural policy (CAP) was, together with the customs union, the economic activity spelled out in the greatest detail in the Treaty of Rome. It was, indeed, for a long time virtually the only common policy that the Community was able to implement. Most European farmers have benefited from the CAP. Food shortages in the post-war period quickly became a thing of the past. But this relative success came at a price. By dominating the EU budget from the very beginning, the CAP stifled the development of other common policies. At the same time, its basic principle of guaranteed prices for farmers generated huge food surpluses. These were exported at subsidised prices, distorting world markets, bringing the EU into conflict with the United States and other food exporters, as well as with developing countries whose farmers could not compete with cheap imports from Europe.
