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Add to FavoritesDo Americans like cheap food? Subsidies provide that they will receive their food at some of the lowest costs in the world.
In the 1950's, a brand new tractor and breaking plow cost about $1500. Today, an average USED tractor costs about $80,000.
In the 1950's, the price of corn was $2.50 a bushel. Until two years ago, the price of corn had been around that same price, sometimes higher, sometimes lower. Every input that farmers have, every piece of equipment, every seed, ton of fertilizer, and chemical they use to produce some of the least expensive food products in the world has doubled, tripled and quadrupled in price. Fertilizer alone is over $1100 per ton in some varieties. That same fertilizer in the 1980's was merely $140 per ton.
Take a 50 acre field of corn - with 9-11 tons of fertilizer; seed that must be bought at a premium; chemicals; fuel that goes higher in price every day to run the equipment; wear and tear on that $80,000 tractor; and that farmer makes less than 20 cents a bushel in profit - before he takes out living expenses for himself and his family. With a good corn crop, between 180-210 bushels of corn per acre, that doesn't leave much to live on.
Farmers are not only at the mercy of the Chicago Board of Trade, they are also at the mercy of the weather, seed and chemical companies, OPEC and our very own government. Subsidies are the only guarantee they have that they will receive any income in bad years due to drought, excessive rain or failed government policies. Our government has used the food farmers grow as leverage to prevent wars, with embargoes on exporting our products, and as humanitarian aid all over the world. Fair is fair. If prices can be affected by policy, the lives of our farmers don't need to be ruined by those same policies. Subsidies guarantee that farmers will at least recieve enough to exist.
The average farm was around 500 acres in the 1980's. With the reduction of farms due to adverse economics and extremely high production costs, that average farm size is now around 1500 acres - and getting larger every day.
As with other businesses, economies of size are important in our farms. As farms get bigger, and we lose smaller farms (smaller businesses) or export those smaller farms (smaller businesses)to other countries, we face higher food prices because larger farmers with 100,000 acres or more (large businesses) will be able to demand higher prices for their products.
Perhaps they are correct, we don't need small farmers, (Small businesses). We can do business with the mega farms, but when we do, and we lose the independent men, women and families who farm our land, we will lose more than a group of small businesses. We will lose a lifestyle that is so incredibly wonderful that it produced this great nation in which we live. Most of the men who framed Our Consitution were farmers, the men who wrote and signed the Declaration of Independence were farmers and most of the men who fought in the war in which we earned the right to be these United States of America were farmers. We will lose the last group of people who give an honest days work for the money they earn. Men, women and children who have a relationship with the land. A farmer tends the land as he does his children. It is his to take care of while he lives on it, raises his crops, animals and family on it. He would no sooner hurt that land than he would himself. It's not just dirt, seed and water, it is a living thing that grows, breathes and ripens under his hand to produce food not only for his family but for the families of our world.
Learn more about this author, Rachael Lee.
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No
U.S. farm subsidies were once intended to help farmers ride out variations in their markets. Since then, they have become a massive part of the federal budget, costing taxpayers billions per year. Because the largest producers get the most government aid, these payments have the effect of further enriching profitable farms. This system not only fails to support small farms, but can create tougher competition for them.
A 2004 Government Accountability Office report detailed multiple instances of payments to ineligible parties who did not require government assistance. In response, the Obama administration has vowed to modify the program, and Agriculture Secretary Tom Vilsack is now in the process of changing the rules for 2010 recipients. The specifics of these changes have yet to be established.
Eligibil ity enforcement is most of the difficulty in directing payments to farmers who really need them. As with any business welfare program, using public money to assist privately-owned enterprises creates a conflict of interests. Business owners and investors don't want to be buried in paperwork, and naturally they dislike government officials looking over their shoulders. Yet they still want the subsidies, and because these payments come directly from the pockets of taxpayers, demands for greater oversight of such programs are unavoidable.
The question is whether large farming operations really need the subsidies. Free trade groups point out that a subsidized U.S. food market drives foreign farmers out of business: the surplus crops produced with government aid land in foreign, unsubsidized markets, and without a level playing field, these markets are unable to compete. This creates much higher incomes for U.S. farmers, but negatively impacts the developing world, and has little or no effect on domestic American food prices. We pay higher taxes, food prices are not affected, and international food markets are adversely impacted. There are few good arguments in favor of sustaining the existing system, and plenty of reasons to eliminate it, or at least trim it down to a reasonable size.
But like any kind of business welfare, farm payments have entrenched political support in every country in which they are used, and trying to overturn them would be a costly career move for any politician. The quickest course of action is reform, and Tom Vilsack will hopefully make the system more transparent and less wasteful, so that small farming operations might have more opportunity to benefit, and business people who are only indirectly involved in farming will not receive payments. These reforms are long overdue, and even though they represent a barely-perceptible policy shift, they might ultimately create a more profitable environment for small U.S. farms.
Learn more about this author, Jonathan Young.
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