Farm subsidies are a solution in search of a problem | reTHINK TANK

The classic depiction of the American farm is an aging red barn on a plot of land tilled by a struggling mom and pop. Given that image, it's no wonder that Congress offers billions of dollars in subsidies to American food producers. The only problem? The struggling mom and pop are fiction. AEI Visiting Scholars Vincent H. Smith, Barry K. Goodwin, and Joseph W. Glauber explain.

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[scasey]

Why should tax payers underwrite the risks of farming for major corporations? Private profits & socialized loses. Who struck this deal??

[anindividual]

I'm a farmer and I agree entirely. Farm subsidies need to be downsized at the very least. All these subsidies do is make the rich richer. They also drive up the cost of equipment.

[ytams]

On March 29, 2019 (this year) Britain is leaving the European Union. This means that subsidies paid through the Common Agricultural Policy stop. Farm subsidies are unpopular with British tax payers. This is a good opportunity to rethink the financial basis of the UK's farming sector.

[JFit]

Farmers are hilarious, always complaining about weather, water, how poor they are. Their so close to not making it their houses and out buildings always seem big and new. It's so tuff being a farmer they have to drive around in those old 2022-23 vehicles with the worn out leather seats. I don't know how they survive I almost feel bad for them.

[dionbrandt]

Why doesn’t the government keep its nose out of world market? When the government doesn’t the subsidies could end.

[davidsonlankford]

I think farm subsidies are good. I like to eat and I like cheap prices. Farm subsides = oversupply = fat and happy people = Riot Comtrol

[s]

I don't know much about the state of modern farming, but how are the prospects/potential for further automation?

[Serahpin]

Instead of shifting subsidies from one industry to another, like you suggest, why not just let the tax payer keep their money?

[jeffself]

Farmers are the only business that pays retail for all their inputs and sales their product at wholesale prices. As long as the government controls prices and exports they should have to subsidize the farmers.

[FireweedFarm]

The charts only go back to 1960, at best, so they don't show how low farm prices and net incomes have fallen some the 1940s. It's false to claim that farmers saw near record farm prices in recent years. Yearly averages were not even half of record highs. Meanwhile we had year after year of near record lows. The 1960-2018 average is very low, as Congress reduced farm price floors dramatically from the 1950s, (so already low in 1960, ) to 1995, then they ended it, (like ending minimum wage). They then call this chronic crisis "normal economic conditions." Subsidy programs have always been inadequate for making up for the chronic crisis, and have gotten much worse, with no subsidies for most farmers for crops like corn and soybeans for 2017 and 2018, even though prices had fallen a lot, (ARC program). The big forgotten risk is the failure of free markets for agriculture on both supply and demand sides, leading to below full cost prices most of the time for the major (subsidized) crops since at least 1981. Cheap prices forced farmers to subsidize the loss of their livestock diversity to CAFOs, (also including loss of grass, hay, oats and barley, ) paid by farmers, not taxpayers, and all food is subsidized (below full costs and below fair prices above full costs, ) in similar ways. Not mentioned is that returns on assets and debt has long been very low, lower than most other business categories, such as the agribusinesses selling to or buying from farmers, (who have together increased greatly in shares of the food dollar vs farmers decreasing greatly). In the early 60s the off farm income of farmers was close to 50%, but it's risen to 80% and even 90% (and 95% on especially bad farming years). The problem is tax loss farming, where the rich have a huge advantage, in writing off large incomes against chronic farm losses. the big problem is not volatility, (fluctuations, ) but rather chronic low incomes, though fluctuations are increasing. The median farm portion of farm household incomes has been below zero most of the time since the 90s. Farms don't generally fall into poverty, because those who go broke are removed from the data set, are no longer farmers.

[corn]

good, another video made by people that push pens and paper. Not real farmers. I agree that subsidies may not be the answer but what is the answer when corn sells for $3 a bushel and soybeans under $9 a bushel. Small family farms cannot survive in this atmosphere. Maybe farmers should quit and everyone should be responsible for growing their own food.

[shawna]

You also need to keep in mind that while farmers have a bigger paycheck they put so much of that back into their farm that what's is left for their personal living expenses is sometimes very low

[topofhelist]

Put your hands down if ur never worked on a farm. And didn’t graph mom and pop farms and there large tractor payments . Now go and get the dunce hat. Now go to a co op and look at the price of feed for cattle or pigs the. Go to a farm auction and see what they sell for. You guys are so far off.

[PeterEarl-bd]

Also just, subsidiys make them less competitive

[lukecartwright]

Farming nicer word for lifelong welfare recipients

[tyee.]

I think this video has vastly over simplified some statistics to push their beliefs. They say nothing about the labor intensive work, chemical exposure and related health problems, debt and credit problems, need for expensive equipment, aging out, land grabs, losing their family farms to creditora and the stress that goes along with all of that. Oversimplified by old accented men sitting comfortably in an air conditioned room all day not lifting more than a pencil. This is what's wrong with regulations- they are pushed by people in offices rather than advocated by the people directly related to them. I don't think subsidies should be the main source of how farmers make it, but the excuses to gas light the industry here are a flat put slap in the face to thw people who feed you.

[courknee]

This man has never set foot on a farm.

[authorauthority]

While true this is generally true for farm capitalists and the financial aristocracy as a whole none of this will be directed to American workers nor their taxes reduced, rather here is one section of the financial aristocracy seeking its interests against the rest. At no time is this more true than today where not a single major business would survive without trillions in government free money bringing American workers closer to the level of our Mexican neighbors. Capitalism hurts!