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I'm curious about the "Eliminate Agriculture Subsidies" one. I don't know enough to give a good opinion, but it seems to me like that could wind up pricing basic, quality food out of the hands of the poorest people, and they'd either have problems with starvation or be forced to eat junk.

I mean, maybe I'm wrong, but I could have sworn it was The Man that is keeping eggs down at around $3/dozen and milk around $4/gallon.




The government has very little to do with keeping food inexpensive, in fact through various forms of subsidies and tariffs they make some foods more expensive - sugar vs corn syrup.

Also:

Myth #3: Maintaining a cheap and stable food supply. Some contend that food markets would fluctuate wildly without farm subsidies. In reality, food prices of both subsidized and unsubsidized crops are relatively stable. Given that the percentage of family budgets spent on food has dropped from 25 percent to 10 percent since 1933, any potential price instability would have an increasingly small impact on family budgets.[7] Even if price stabilization was necessary, price support programs have largely been replaced by commodity subsidies that stimulate overproduction rather than stabilize prices. Nor do farm subsidies contribute to lower food costs. Two-thirds of food production is unsubsidized and thus relatively unaffected by subsidies. Of the remaining one-third, price reductions caused by crop subsidies are balanced by conservation programs that raise prices. Furthermore, food prices are based not only on crop prices, but also on food processing, transportation, and marketing costs. Bruce Babcock, professor of economics at Iowa State University, has calculated that eliminating farm subsidies would have virtually no effect on food prices.[8]

http://www.heritage.org/research/reports/2007/06/how-farm-su...


can you quote something a little less biased?


Given the level of agreement, you will have a hard time finding much disagreement from any source.

I would even suspect that a significant number of those who "disagree" disagree more on technicalities than on the general idea that the US's agricultural subsidies are a bad idea as implemented. For instance, I could argue:

1. A free market economy tends to surprisingly precisely match production to demand; producing extra costs you more than your competition is spending and tends to drive you out of business.

2. Food is subject to unpredictable random failures on a large scale.

3. It is better to have too much food than too little.

4. The economic effect of a subsidy is to cause overproduction. (As opposed to price fixing, which is to cause shortage. Rather a lot of verbiage is expended on the internet trying to explain away these two facts, yet the facts remain.)

Therefore, it may actually be desirable strategically for a country and even for the species to subsidize food production, in the hopes that the excess will offset the unpredictable disasters that a free market would tend to produce very little slack for. This will cost the society as a whole more than a "precise match" produced by the free market, but it only takes one bad harvest for this insurance to pay off bigtime. This could lead an economist to vote "disagree" on principle, even if they probably would agree the current subsidy is not an efficient way of accomplishing this goal. As others have pointed out, slamming this to a "true/false" question does erase many of the finer distinctions.

But other than those directly monetarily benefiting and those who don't understand the economics well enough to understand how bad these things are, you're not going to find much thoughtful support of these subsidies as they currently exist.


Governments could buy up large strategic reserves of grain and twinkies. They've done this since Joseph and the Technicolor Dreamcoat.

Overproducing beef and corn syrup won't be as efficient. In fact, it might even bring on the "random failure", by screwing up the water table.


Actually, you'd like federally unsubsided foods. It would mean more locally grown produce and meats. Most of the big agricultural subsidies are for corn and sugar, the really bad stuff. Agricultural subsidies are making the nutrition crisis worse, not better.


It's unlikely that the removal of agricultural subsidies would create a significantly large market for locally grown produce and meats.

In fact, it would probably do precisely the opposite, as food could be outsourced just like the rest of our industry to areas with minimal labor laws to hamper cheap food production.


Don't corn subsidies make food-corn more expensive (the majority of corn subsidies are for ethanol production, which diverts supply from food/feed)?


Many of the subsidies are price supports and protection from foreign competition -- which raise food prices.

'The Man' is keeping milk prices up; read this expose from the (usually very pro-government) Washington Post:

http://www.washingtonpost.com/wp-dyn/content/article/2006/12...


Also, read about what ethanol subsidies are doing to prices elsewhere. Farmers are replacing fields of grains and other crops with corn, in part because corn was already profitable before the subsidies. This has in turn increased the prices of a wide variety of food. One sad example are the prices of hops and barley, which has strained beloved micro-brewers.


The subsidies cause harmful distortions. They ruin farmland and create unnecessary pollution because farmers overproduce. They put farmers in poorer countries out of work because we export our excess crops. This causes harm to relations with our neighbors and hampers trade agreements. They cause unhealthy eating habits by making high fructose corn syrup artificially cheap. They make our cattle sick because we feed them corn instead of grass. I could go on and on.

It's fair to say we don't want people starving, but removing farm subsidies wouldn't have a large effect on grocery prices and there are better solutions such as giving additional funds to the poor.


An additional problem with subsidies is the detrimant to international trade.

For example, massive subsidies make corn in America TOO cheap, that everyone in Mexico City buys American corn! Yet comparative advantage would say Mexico, with a higher proportion of unskilled laborers, should be able to put corn on the marketplace in their own country cheaper, and build up their economy.

Subsidizing exportable domestic goods has similar negative effects to tariffing imports.


The only glaring flaw with your argument is that corn production is a capital-intensive process, not a labor-intensive one. High-yield corn is produced using big machines and lots of nitrogen-based fertilizer. A high proportion of unskilled laborers is useless for corn, but is useful for fruits and vegetables. This is why you have large pools of unskilled migrant labor working the fields in California but now Iowa.


"Basic, quality food" isn't the issue. Right now we have an abundance of junk made from subsidized crops. High fructose corn syrup only came into vogue because there was a surplus of corn lying around because of corn subsidies.

Food represents such a small part of the average American's budget (about 12%) that the real restraints on healthy eating are convenience (Chicken sandwich---five minutes of ordering and waiting in line on the way somewhere. Grilled chicken---25 minutes at home) and education (looking up how to make grilled chicken---10 minutes). If anyone actually looks at what they're eating, they can almost certainly increase quality AND decrease cost.


Indeed. A lot of the junk food culture comes from agricultural subsidies, not just the obvious corn syrup. I recall (but can't find the link) a study showing that a really high proportion of supermarket products had traces of corn (even meat).

When you cross the border you see these effects more clearly. Here in brazil, for example, for most of my childhood McDonalds was an expensive-ish place people went out to eat in, and even today junk american-style chocolate bars cost way more than standard not-so-junky chocolate. With an exception for soda (which can be cheaper than bottled water in some places) junk food is not at all attractive if you don't actually have a lot of money (the standard no-money food around here is beans and rice, with maybe cheaper cuts of meat thrown in the beans or served with the food; junk food costs a lot more than twice that).


yes, I have heard that one of the reasons why there are 99 cent cheeseburgers in all of the major fast food chains here in the US is because of the subsidies. Essentially all the ingredients that go into those burgers are subsidized. When you think about an actual market economy it would seem that some kind of rice and beans with mixed vegetables would be what would cost 99 cents.


In that case, why not spend the subsidies on reducing taxes for those poorest people, or on giving them benefits in other ways?


Notice that subsidizing the 'best' foods basically gives the poorest people a break ONLY when they eat good foods. Which may not be such a bad thing. Notice food stamps already do much the same thing. I personally know I would much rather subsidize a poor guy buying milk and bread than a poor guy buying donuts or alcohol.


Agricultural subsidies are one of the weird parts of countries economic policies. Simply put, nearly every single developed country has them. And nearly every country agrees that 'in the long run we should probably get rid of them', but then also agrees 'realistically, nothing will budge, so we'll ignore it as much as we can at every WTO (previously GATT) meeting'

And the reason why they continue to exist, and will probably continue to exist is that there are relatively few farmers in each of those countries, who make up incredibly homogenous democgraphics within their election ridings. Government that even proposes eliminating the tariffs will lose their rural seats/votes/whatever. Every single one of them.


The effects on seats depends a lot on how the seats are distributed. It is a much less powerful effect in countries that have a proportional distribution compared to the effects in a winner takes all system.

Sigh. Here in Sweden we had finally managed to totally do away will all subsidies in the early 90's. Then we entered EU and got more subsidies than ever. :(


Some governments have gotten rid of them. I believe New Zealand cut its agricultural subsidies greatly in recent years without ill effect.


I often wonder in conversations like this how many people have actual backgrounds in agriculture? Yes, in some states milk is price regulated and subsidized. Sometimes to keep prices low and sometimes to keep prices high (it kinda depends on the place - yes, screwy and in the same place people argue about the reasons). Messing with subsidies will raise input costs to a lot of businesses, much like rising truck transport costs.

Generally someone will pull out this local plots / in city farms and forget a lot of basic economic truths about mass production and transportation.


Well I tend to believe the really poorest people are more affected by the current dumping of the excess produce than the poor americans you refer to would ever be affected.




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