Letters to the Editor
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Trade offs
Aren't higher food prices going to push manufacturing wages higher in countries like Mexico and China? That and a falling dollar would tend to make US manufactured goods more competitive. It won't have the same effect here because most people spend a lot less of their income on food. We may be shooting ourselves in the foot subsidizing Cargil and ADM.
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Hmmmm. What if...
we tax the super rich and subsidize the food costs of the ultra poor non farmers. No forget that. Taxing the super rich isn't fair. Let's just eat them.
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Subisidies
But who is the ultimate payor of these government subsidies?
How does paying them affect the cost of food?
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Food, glorious food…
Subsidized agriculture is the basis of all of our food industry. On its own, it is non-sustainable as it is based on annual mono-crop cultures, on the intensive use of oil derivatives (for pesticides and fertilizers) and creates huge uncontrolled amount of pollution. If you believe in Peak oil and climate change, it gets pretty grim.
It keeps non-industrial farmers down into a (relatively) expensive niche because they cannot compete with the artificially low prices of subsidized industrial farming, and insures that those in non-subsidized country will have a hard time. Thus, our taxes are used in a way that make sure that we keep eating crap and become sick (obesity, diabetes, cancers, cardio-vascular disease), which costs us even more in term of healthcare.
If the government stops subsidizing agriculture, most of it will probably become uncompetitive overnight and most of the food industry will have to re-invent itself, fast (which probably mean it just won’t happen. This is me, being pessimistic). Prices would rise and sustainable farming here and abroad would become competitive. People would have to pay the actual price of quality food, eat less of it on average and maybe slow down on other less necessary consuming (or add it to our $8,000 on average family credit card debt).
Note also that in an overpopulated world, feeding the poor raises many complex moral issues. On one hand it is not acceptable to watch people die when you can feed them, on the other hand it is one of those cases where increasing the supply (of food) will lead in the next cycle to a new increase of the demand (of hungry population). There is very little acceptable solution to this one, except maybe educating populations into controlling their growth, despite all the Pope says. I’m all for Be fruitful and multiply and fill the earth but it is pretty much filled by now… Besides, I have always read the rest of the text as giving to human beings (“Man” is so heavily connoted these days) stewardship over the Earth. Time to start picking up the trash…
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The Pet Cemeteries are already full
The government solution is always to encourage their constituents to make themselves as dependent as possible on the politicians, their policies and their handouts. Do you think Bernanke would say, gee Mr and Mrs America, you should pay down debt, and save some money. Everytime we have one of these economic blowups Bush comes out and begs us all to go shopping, which is counterintuitive to what is sound advice. If they suggest cheap (foreign imported food) don't go for it, you've already seen the results, the pet cemeteries are full.
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The US helps feed about 40% of the world
Making that output more expensive might ring with the idiot Marxists who see the destruction of firms like ADM to be a moral good, and they might not even care if 200 million starve off as a result. But in the rational non doctrinaire world it's generally considered a poor choice.
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@electro
You're pretty "doctrinaire" yourself, Electro. An understanding that industrial food crop production (I won't even call it farming) is unsustainable, or that most of those farm subsidies that were supposed to help support family farms are going to agricultural giants with a vested interest in destroying the family farmer, doesn't make anyone a "marxist".
If world food prices go up, US agrogiants are not going to produce less food they are going to produce more. And as weak as the dollar is right now they'll still be selling at an advantage.
The thing is that "marxists" like me don't see any reason to have government subsidies for industries that are already making lots of money. Or for that matter industries that aren't. Us "marxists" believe in small, locally owned businesses and would like to see them not having to compete with corporate giants on the government dole. Us "marxists" don't believe in corporate welfare. How about you?
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What do I believe
I don't believe in ideology uber alles. I believe in what works. If some subsidies work to efficiency aid the production of food, fine, do that. If you're looking for me to bounce hate mail off your one dimensional ideology you're talking to the wrong person. Sorry. Small farms aren't efficient. If that irks your ideology, I can't worry about that. I don't drive a handmade car either.
I tell you though what form of small farming is frightfully efficient. Tobacco. Virtually all tobacco farmers are sharecroppers. The land owner gets a crop rent and the farmer pays out all of his costs from his share. The reason for this is because other than illegal drugs, and some herbs, there is more profit per acre in Tobacco than any other crop we grow in the US. And the work to bring in the crop is horribly labor intensive. It simply can't be automated.
Whereas, do you know what the 4th largest cash crop in the US is today? Anyone? It's SOD. That's right lawn grass sod is the 4th largest cash crop in the US. Why? Everyone wants it and it's cheap to make. So cheap in fact it's massively automated & an average sized SOD farm is more than 700 acres minimum with a labor overhead of perhaps 3 people, maybe 5. If anyone were to suggest small SOD farms they would be out of business in one year.
You know what else lends itself to massive efficiencies? Cranberries. In fact there's a whole industry in New York state that turns defunct dairy farms into productive Cranberry Bogs. Once they're established they are enormously efficient and require almost no labor over huge tracts of land.
So yeah I know a little agronomy. There are perhaps 4% acreage of all food crop farms in the US classify as 'small farms'. That's it. And they don't produce more than 4% value correspondingly in other words there's no leveraged advantage. Now if we remove all subsidies they go out of business tomorrow, the agribusiness farms absorb new costs, you pay correspondingly more. The farms don't hire more people, they automate more to hire less to offset their costs and poor people eat less.
Which I'm not convinced is a good thing that ideology has delivered. Maybe it is but I'm not convinced.