Farm Subsidies & Pork

[fuelair]

This concentration and surplus and limiting of varieties of many of the agricultural products works well for us until a wheat or corn or rice virus/mutated bacteria comes along that is a perfect fit to the primary version of the commodity. Then, life becomes really interesting!

 

[Overman]

9.2% of our exports are agricultural products.

A number that is likely to increase...

 

[ImaginalDisc]

No, it doesn't. What agriculture subsidies in the entire western world do is create poverty and instability in 3rd world countries in Africa and Asia by making them uncompetitive. The only product many 3rd world countries have to offer is agriculture - but they can't compete against the heavily subsidized crops of America and Europe.

But if you're fine creating poverty, starvation, death, and misery in 3rd world countries keep thos subsidies flowing!

I don't think I follow your argument at all. Because we export cheap food thrid world countries starve to death?

 

[ImaginalDisc]

A number that is likely to increase...

China gets 4.6% of our exports (as of 2005), but I don't know how much of that is food.

 

[WildCat]

I don't think I follow your argument at all. Because we export cheap food thrid world countries starve to death?

Because we sell cheap food (below the cost of production due to subsidies) farmers in developing countries can't sell their food at all. If they can't sell their crops, they get poorer. And in a developing country that has a large percentage of their people still working on farms (as the US once did) this is disastrous.

http://www.tradeobservatory.org/headlines.cfm?refID=17621

 

[Kerberos]

Do you not see how falling food supplies in conjunction with an increase in urban population could be construed as a bad thing?

Well I don't. Now if there was any risk of this resulting in less food being produced in the US than was needed and if such a shortage could not be easily remedied by importing food then it might be a problem. However I’m far from certain that the first is likely and the second is plain ridiculous.

Also as Wildcat says the policy contributes to impoverishing the third world. So not only is it inefficient form an economic PoW it is deeply immoral from a humanitarian one. We are actually paying to cause starvation in Africa. Farm subsidies are one area where everyone, irrespective of their political viewpoints should be able to agree.

 

[Dr Adequate]

I don't think I follow your argument at all. Because we export cheap food thrid world countries starve to death?

Yes, it sounds odd, doesn't it?

But google on "crop dumping".

 

[Kerberos]

I don't think I follow your argument at all. Because we export cheap food thrid world countries starve to death?

Yes actually, what you need to understand is that starvation is not caused by insuficient food being produced. It's caused by people being to poor to afford it (and wars of cause but that's a seperate issue). When we dumb our aggricultaral products at prices they can't compete with, we empowerish their farmers, meaning that they can in fact risk starvation because of cheap food.

 

[ImaginalDisc]

At first, I was going to say, "developed nations, not developing nations, are our major agricultural export partners," but the USDA's website provides pretty strong data showing how much many developing countries receive from us. Warning: The following link is an Excel file: USDA's year-by-year US agricultural exports. Well, there's little doubt that market forces contributed as much to the Late Victorian famines in China, India, and South America as much as climatic factors, so obviously market decisions can cause famine. The group of 33, mostly developing countries within the WTO, make a strong case for agricultural tariffs to protect their markets.

Ok, let's assume that we don't export any food at all, and we respect the group of 33's demands regarding agricultural protectionism. Would it be better for the U.S. to import foreign, lower cost, foods, reducing the supply of American crops? Is being dependent on foreign food good for our economy?

Maybe turnabout is fair play, but if developing countries want to protect their agricultural sector from cheap US imports, why shouldn't the US protect its agricultural sector as well?

If we abolished subsidies and tariffs both, we'd have lots of food coming in from developing nations that wouldn't be subject to US food regulations or environmental legislation that makes our food production more expensive compared to a more poorly regulated country.

 

[Kerberos]

At first, I was going to say, "developed nations, not developing nations, are our major agricultural export partners," but the USDA's website provides pretty strong data showing how much many developing countries receive from us. Warning: The following link is an Excel file: USDA's year-by-year US agricultural exports. Well, there's little doubt that market forces contributed as much to the Late Victorian famines in China, India, and South America as much as climatic factors, so obviously market decisions can cause famine. The group of 33, mostly developing countries within the WTO, make a strong case for agricultural tariffs to protect their markets.

Ok, let's assume that we don't export any food at all, and we respect the group of 33's demands regarding agricultural protectionism. Would it be better for the U.S. to import foreign, lower cost, foods, reducing the supply of American crops? Is being dependent on foreign food good for our economy?

The US currently has a large export. So it's far from given that you would actually need to import food even in the absence of subsidies. But to answer you question; yes it would be good for the US economy to be dependent on foreign food if it was cheaper or better, the US economy is already dependent on importing all sorts of stuff, as is pretty much every economy in the world.

Maybe turnabout is fair play, but if developing countries want to protect their agricultural sector from cheap US imports, why shouldn't the US protect its agricultural sector as well?

Seriously the mind positively boggles at statements like that. Do you have any idea whatsoever How much more massive the farm subsidies that western countries employ compared to whatever paltry subsidies a bunch of 3rd world countries might muster? I'm suspect that farmers in the 3rd world would be overjoyed if the West reduced it's subsidies and protectionism to the same level as what these countries have. Also did you miss the part about farm subsidies being a waste of money? You're essentially arguing that because somebody else is banging their heads into a wall, you should be allowed to as well.

ETA: Also I see that it is somthing they have proposed, not something they've done. Do you really think that proposals are equivelant to actual policies?

If we abolished subsidies and tariffs both, we'd have lots of food coming in from developing nations that wouldn't be subject to US food regulations or environmental legislation that makes our food production more expensive compared to a more poorly regulated country.

Again you assume that you would need significant imports. Still let's assume that is true for the sake of the argument. OK here is the awesome magical solution, ready for it? Here it comes. Leave you food regulation in place.

Seriously do you think that abolishing farm subsidies mean you automatically have to permit people to sell food containing nuclear waste or whatever? If the farmers in the third world can't produce safe food then don't import it, but many of them probably could. You don't necessarily need high-tech equipment in order to produce wheat, corn or sugar that is non-toxic. Probably you already do import some food from the third world though not much.

As for environmental regulations then I guess that you can't dictate that. Are you arguing that we need to continue farm subsidies that cause significant poverty to protect the pristine African environment? If you're concerned about the environment you should make that a priority of the US foreign policy. Defending the farm subsidies on the ground that there might be some small incidental benefits for the African environment is just plain ludicrous.

 

[ImaginalDisc]

Seriously the mind positively boggles at statements like that. Do you have any idea whatsoever How much more massive the farm subsidies that western countries employ compared to whatever paltry subsidies a bunch of 3rd world countries might muster? I'm suspect that farmers in the 3rd world would be overjoyed if the West reduced it's subsidies and protectionism to the same level as what these countries have. Also did you miss the part about farm subsidies being a waste of money? You're essentially arguing that because somebody else is banging their heads into a wall, you should be allowed to as well.

No, that's not what I'm arguing. I'm saying that if we let market forces take their course without either tariffs or subsidies, that one or more domestic agricultural sectors could be wiped out. That's certainly within the realm of possibility, is it not? Should the US make a policy of having its entire rice market come from overseas sources? Just because other countries, even Japan, are essentially in that position it does not follow that the US should.

Again you assume that you would need significant imports. Still let's assume that is true for the sake of the argument. OK here is the awesome magical solution, ready for it? Here it comes. Leave you food regulation in place.

Seriously do you think that abolishing farm subsidies mean you automatically have to permit people to sell food containing nuclear waste or whatever? If the farmers in the third world can't produce safe food then don't import it, but many of them probably could. You don't necessarily need high-tech equipment in order to produce wheat, corn or sugar that is non-toxic. Probably you already do import some food from the third world though not much.

As for environmental regulations then I guess that you can't dictate that.

Lovely. Firstly, it puts the US in the position of having unenforceable regulations. Is the US going to send USDA inspectors into every meat packing plant in foreign countries? Are we going to examine and inspect every step of the importation process? Countries that want to import to us must meet our standards, and our standards are effectively a barrier to trade. Developed nations, and even some developing nations can meet those standards. Our standards are part of the reason why our agricultural producers sometimes struggle to remain competitive. Our producers face competition from less well regulated foreign producers with lower labor costs.

 

[davefoc]

Not Sarcastic, but my arguement was not built around starvation.

In my area of IL we see this all the time. Farmers retire and sell their land to developers. What used to be nothing but corn and bean fields as far as the eye can see are now subdivisions and Mejer's, Jewels, Walmarts, and stipmalls. None of that land will ever be farmed again, and therefore there is less production. Prices rise, and quantity becomes more scarce with each one. There is only a certian amount of farmable land for such products, and that land is being used less and less for those ventures!

Do you understand the idea of supply and demand? The idea in this situation is that if food production dropped to the point that people were hungry the price of food would go up and thereby drive farmers to produce more.

Food subsidies in the US, as has been suggested above, are almost entirely driven by politics. As wildcat said they damage third world countries enormously. They impose a double taxation on all the non-farmer population of the US. First because taxes pay for the subsidies and then most insidiously of all for the poor they raise the price of food. Of course the government then institutes programs like free processed cheese for the poor to allegedly help the poor, but BS like that not withstanding the poor in the US are made poorer by food subsidies.

Occasionally, you will hear the argument made that only small farms should be subsidized. Thus avoiding the direct transfer of billions of US taxpayer dollars to some of the richest people in the US. Unfortunately, the law of supply and demand steps in the way of this idea. If you don't prevent the large producers from overproducing by buying up their excess capacity their product will flood the market, thereby reducing prices and make it even dicier for the small farmer.

If your goal is to maintain small to medium farms in the vicinity of urban areas there are ways to achieve that. An urban area might buy up farms and lease them back to farmers. It might directly subsidize the farmers to encourage them to stay. And I am sure there are many other ideas to accomplish this kind of thing. But government interference in the market to manipulate the price of food has been an unmitigated disaster. It is a disaster that before the Bush administration, congress was slowly trying to do something about. However, given the unrelenting corruption of the Bush administration, a reversal of the farm subsidy reforms was inevitable.

 

[Kerberos]

No, that's not what I'm arguing. I'm saying that if we let market forces take their course without either tariffs or subsidies, that one or more domestic agricultural sectors could be wiped out. That's certainly within the realm of possibility, is it not? Should the US make a policy of having its entire rice market come from overseas sources? Just because other countries, even Japan, are essentially in that position it does not follow that the US should.

Two words: Why not? Why exactly is it the end of the world for the US to buy its rise from China rather than Kentucky? You already buy many of your electronic products there.

Lovely. Firstly, it puts the US in the position of having unenforceable regulations. Is the US going to send USDA inspectors into every meat packing plant in foreign countries? Are we going to examine and inspect every step of the importation process? Countries that want to import to us must meet our standards, and our standards are effectively a barrier to trade. Developed nations, and even some developing nations can meet those standards.

You lost me there. You seem to start out by saying that you can't do it and then proceed to saying that some countries could meet your standards. As for you regulations I already pointed that you do in fact already import food stuff so you're already dealing with any problems there might be there. I really don't think it's a major technical problem to sample imported corn, wheat or sugar for any pesticides they may contain.

Our standards are part of the reason why our agricultural producers sometimes struggle to remain competitive. Our producers face competition from less well regulated foreign producers with lower labor costs.

Your standards and the fact that labour is more expensive are two quite different and only slightly related issues. Furthermore it is issues that are in no way particular to the farming industry, and it does not explain why dumping farming products in developing countries is a good thing.

 

[ImaginalDisc]

Two words: Why not? Why exactly is it the end of the world for the US to buy its rise from China rather than Kentucky? You already buy many of your electronic products there.[/QUOTES]

Because it would make us dependent on foreign sources for food. Being independent on a vital resource such as food would be the ideal case.

You lost me there. You seem to start out by saying that you can't do it and then proceed to saying that some countries could meet your standards. As for you regulations I already pointed that you do in fact already import food stuff so you're already dealing with any problems there might be there. I really don't think it's a major technical problem to sample imported corn, wheat or sugar for any pesticides they may contain.

Some. Some countries may not. Countries that cannot or will not should not be allowed to trade with the US.

Your standards and the fact that labour is more expensive are two quite different and only slightly related issues. Furthermore it is issues that are in no way particular to the farming industry, and it does not explain why dumping farming products in developing countries is a good thing.

I began with the assumption that we cease dumping subsides food on the market by accepting the group of 33's demands.

 

[FarmallMTA]

Thanks for posting this thread, Katana. People usually go into serious doze mode at the first mention of "farming" or "subsidies" (which inattention is partially to blame for the current state of affairs). Understand that the USDA agricultural subsidies regime is a textbook example of what happens when interests of politicians and a narrow special group overlap exactly. The 2004 Presidential Election voting behavior in two side by side states helps illustrate.

Missouri. http://www.cnn.com/ELECTION/2004/pages/results/states/MO/P/00/index.html
Two massively blue counties: Jackson County (Kansas City metropolitan area) and St. Louis County (St. Louis metropolitan area. Most rural counties trended significantly red. Final tally was Final tally was Bush 53%/Kerry 46%.

Iowa. http://www.cnn.com/ELECTION/2004/pages/results/states/IA/P/00/index.html
Much more even distribution of blue-tinged counties and red-tinged counties. Final tally was Bush 50%/Kerry 49%.

Both states benefit considerably from farm subsidies. Not peanuts so much as for other row crops and dairying. Why? Because in both states, Republican/Democrat voting is very close overall.

In Missouri, the Republicans MUST carry the rural counties to offset the certain loss of the two huge population centers. So Republicans are interested in shoveling as much vote buying into those areas as they can. So why don't the Democrats cut 'em off when they're in power? Because they don't want to stir up the hornet's nest and cause an angry rural big turnout in the next election, which would be guaranteed to get them defeated. So in this case, Republicans carry the farm subsidy ball and the Democrats look the other way. The two, in effect, collude by commission and omission.

In Iowa, on the other hand, both Republicans AND Democrats depend on rural votes to win elections. So both compete mightily to be seen as the best sugar daddy of all for the rural vote. In this case, Republicans and Democrats in effect work hand in hand to ensure subsidies to farmers in their efforts to buy the same votes.

It is different in other states. Massachusetts has a relatively insignificant farm vote while the urban areas are overwhelmingly blue. So the impetus for farm subsidy support is quite small, other than a socialist love for market tinkering with everything (but that's not farm specific: socialists happily subsidize buggy whip manufacturing while adamantly banning the private space exploration business).

Upshot? We get screwed and farmers get paid massive subsidies to either not farm or to produce way more of what they were going to produce anyway. Laugh about that the next time you're eating a peanut butter sandwich that cost 4 times what it should and wash it down with milk that costs 5 times what it should. Food availability and price stability have absolutely nothing to do with it, other than making for some really tear jerking fancy rhetoric for the sentimental saps who are easily frightened by such Sh!tofbull.

 

[geni]

In fact, farm subsidies in general puzzle me. Researching the topic only revealed what appeared to be heavily-biased websites and unrevealing articles. So any insight that can be offered would be welcome.

Farm subsidies can exist for a number of reasons:

Trying to stabilise the food suppy
Trying to introduce a new crop into a country
Trying to get rid of a crop (say opium) by promoteing a different crop
Reduceing food prices at the point of purchase
Trying to keep farmers on the land (which is what the current lot of subsidies should do in theory)
Trying to support certian forms of land mamagement (make sure all those drainage ditches are kept in good condition
Covering the cost of expensis imposed by the goverment (in the UK farmers were given £5 to demolish pill boxes after WW2 although most didn't bother).

I also find this practice of attaching completely unrelated and often outrageous junk to bills so irritating (I know, join the club).

It happens in most democracies. You can only pass a certian number of bills in a certian time period so it makes sense to attach certian non-contiversal stuff to unrelated to bills to save time (say closeing minor tax loopholes or shifting a few chemicals into a different enviromental braket) this is more of an issue in democracies where things are highly centeralised.

 

[Kerberos]

Because it would make us dependent on foreign sources for food. Being independent on a vital resource such as food would be the ideal case.

First of all you export significantly now, you could reduce subsidies gradually to see if you began producing so little food that you needed to do a net import. Your fear is however probably totally unjustified. Importing a vital resource is only a problem if a disruption in the supply is likely, that is probably not the case with food.

Food can be and is produced in all parts of the world meaning that a disruption such as a civil war in one of your major suppliers can be solved simply by buying from someone else. Dependency of oil is a strategic problem because it is primarily gotten from a limited number of politically unstable countries. Dependency on food, even if it was to happen, would, not be a problem because such conditions would not apply. And I emphasize again that it is very far from certain that you would need to have a net import even in the absence of subsidies. Such a “problem” is more likely to affect Europe.

Some. Some countries may not. Countries that cannot or will not should not be allowed to trade with the US.

Which is perfectly reasonable as long as the demands are fair, no one expects US or EU consumers to have to eat food that’s dangerous. AFAIK 3rd world countries primarily produce food products such as corn, sugar and wheat, as opposed to meat which means that health risks are less likely to be an issue.

I began with the assumption that we cease dumping subsides food on the market by accepting the group of 33's demands.

Ok, I missed that, my apologies.

 

[armageddonman]

Scanerio: Corn farmers faced falling corn prices, and have to switch to selling a variety of corn fit for consumption to a variety of corn fit for making biodisel, a scenario that is actually playing out in regions in the American heartland. Unless we subsidized the corn farmers to keep producing corn for consumption the supply of corn would drop dramatically.

I really like the idea of using government assistance to raise low prices for staple foods. The Department of Defense buys up a lot of milk, eggs, and other foods and often that food is given to school districts, prisons, and the military. Our local school district gets millions of dollars worth of food from the DoD, which helps to support our "free and reduced lunch program," which provides free or low cost meals to children who otherwise could not afford to eat well. It also helps keep the cost of our district's meals at $1.25. Just try to buy a lunch or breakfast for $1.25 anywhere else.

It creates a complicated net of social services, supporting unprofitable crops, feeding hungry children, prisoners and military personnel, but when it's working it helps a lot of people. It also helps the consumer by maintaining a stable supply of eggs, milk, grain, rice, meat and other staple commodities. It helps businesses that process food by making sure the price of those foods remains stable, which prevents Tombstone Pizza prices from rising or falling dramatically whenever the price of tomatoes, cheese, or other ingredients changes.

Again, the whole practice of slapping subsidies onto other bills is just crazy, IMO.

It also hurts the economies of countries that are able to produce food cheaper gravely by ruining the prices. Furthermore overproduction is exported into those countries where it can be sold for less than local products, ruining the food industry there.

Subsidies on non-profitable industries have been around for literally hundreds of years but in the end never had the desired effect.

 

[armageddonman]

My school district receives commodity pork products from the Department of Defense at no cost, so yeah. Pork pork.

Free and/or cheap milk, eggs and pork. Do you also get healthy food?

 

[Dr Adequate]

So the impetus for farm subsidy support is quite small, other than a socialist love for market tinkering with everything (but that's not farm specific: socialists happily subsidize buggy whip manufacturing while adamantly banning the private space exploration business).

That must be a big problem in:

(a) Cuba.

(b) The magical fantasy world inside your head.