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Corn subsidies

Should the US government maintain its corn subsidies?

  • Yes. There is a good reason they exist.

    Votes: 0 0.0%

  • Total voters
    17

Phys251

Purge evil with Justice
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Each year, the US government spends several billion dollars subsidizing corn. By some measures, it is the most-heavily subsidized crop in the US. Most of the corn goes into animal feed as a substitute for grass, high fructose corn syrup, or ethanol fuel.

What changes would you make? Would you get rid of them entirely?
 
Subsidies are a manipulation of the market. End them now.
 
We subsidize the farmer for growing it and then give 47 million people food stamps to buy it. Without the subsidies the price will first decline until farmers growing corn give up and don't plant any (because its not worth it) and then it will demanded and they will ultimately produce. Subsidizing the farmer seems to me more about buying the Iowa straw poll then any sense of reality.
 
Most of the farmers I know (and I know several) would do just fine without the subsidies.

It would make things somewhat more difficult on smaller farmers though, since they're not farming enough acreage to easily swallow the costs of equipment and things.
 
First corn doesn't replace grass in ruminant's diets. It puts the marbling into finishing animals, energy into quick growing young stock, and boosts lactation. For pork and poultry production it is a vital feed element.

Second as a small farmer I can say the subsidies I get are so small they wouldn't be missed that much and don't help me purchase equipment. On the farming side of my operation I use custom men. Guys who harvest the grain and bale hay for others. No amount of subsidy would pay for the swather and baler needed to bale my hay and the price of even used combines is far above any Gubmint payment.

I don't think we would want a system where the invisible free hand of the marketplace works it's magic on food supplies like it did for the stock market. Those who bemoan the number of their fellow citizens who use food stamps now, let a cyclic boom/bust system run the food supply.

'Job Creators' claim the marketplace hates uncertainty, that is so true in food production. Weather already throws in enough uncertainty, the commodity market has been opened up far too much to speculators to not have some sort of surplus in the basic food production.

That is the key point to subsidizing basic food production such as corn.
 
Subsidies are a manipulation of the market. End them now.

The USA is the number 1 subsidised economy in the world - protectionist, tariffs etc

The strange thing is the USA demands open free economies from all other nations, and the ones it can control openly the USA imposes free trade agreements with such as NAFTA and the free trade agreement with AUstralia

If the USA wishes an open free market on the global stage, why does it pursue exclusionist free trade agreements?

Why does it compel nations to trade OIL for example in US currency? (although that landscape is changing)

I totally agree with you on the removable of subsidies - but guess who doesn't want that to happen? (Hint - its not China)
 
make cannabis legal, and my guess is that the corn subsidy problem will solve itself quickly.
 
The USA is the number 1 subsidised economy in the world - protectionist, tariffs etc

Well yeah, it's kind of embarrassing to preach about free market, free trade, etc and heavily manipulating the "free" market at the same time.
 
Subsidies are a manipulation of the market. End them now.

Can't we just start with the 22 billion or so we give to the oil companies and see what that does??

Some subsidies we give to farmers are desperately needed.. Just saying..

We can't live without farmers, and some farmers can't live without the financial help that subsidies provide..
 
make cannabis legal, and my guess is that the corn subsidy problem will solve itself quickly.

Sure.. Nobody will grow corn and the cost of corn will sky rocket.. While the price of pot will drop to nothing.. Is that going to be what is for dinner?? Did anyone see that low calorie bong at Walmart?? :popcorn2:
 
Well yeah, it's kind of embarrassing to preach about free market, free trade, etc and heavily manipulating the "free" market at the same time.

Its not embarrassing to the monopolies and corporations in the USA - they understand all too well how the ravages of market discipline and genuine free markets should NEVER apply to them. These economic principles are for the small fish - the corner shop, the small company, the little self employed person. There can NEVER be bail outs for them. Who was it that said, "if they are too big to fail, then they are too big to exist"?

I can recall what the USA told the Asian countries in the 1990s when their economies overheated and essentially crashed. The USA strongly recommended to all the Asian countries - including Japan and Singapore to NOT implement bail out rescue packages and above all to NOT nationalise any banking institutions or important large corporations or industrial sectors. The USA then pushed ASian nations to implement further privatisation and corporatisation programs and said that allowing the financially stricken commercial sectors and corporations to collapse was a good thing and that it would lead to a stronger economy in the long run. (which is generally does, if the nations itself still controls the bulk of the assets)

And of course this was ideologically driven advice that had self interest at heart - because it was the USA and the west that snapped up corporate and state asset bargains during the economic turmoil in Asia.

And the USA did the complete opposite in the 2008 GFC to what they advised the Asian countries to do. They implemented trillion dollar tax payer funded stimulus packages (also known as corporate welfare) and nationalised the auto industry. lol

The same advice was given to Argentina when its currency and economy collapsed in the 90s, which resulted in Argentina defaulting on its loans. It caused a lot of short term pain, but Argentina recovered within a decade and is far stronger now. This is what Greece, Ireland, Spain, etc should do now - the problem is an external banking and credit crisis which the sector wishes to shift the total debt (which they created) into state hands.

So you shouldn't be embarrassed at standard practice in the USA. In good economic times, the private/corporate sector is subsidised and propped up artificially by the tax payer, and during bad economic times, the private/corporate sector is subsidised and propped up by the tax payer.

Its the fascist Corpocracy at its grandest!

And the media (which is a corporatized entity anyway) remains silent or totally spins the truth into total BS

cheers
 
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I'm pretty sure the Bolsheviks and the Nazi's subsidized their farmers too and they never imposed High Fructose Corn syrup on their populations.

Not only is the subsidy of corn dumb, the subsidy is also for ethanol made out of corn. Just another thing to help make corn scarce and raise prices.
 
Sure.. Nobody will grow corn and the cost of corn will sky rocket.. While the price of pot will drop to nothing.. Is that going to be what is for dinner?? Did anyone see that low calorie bong at Walmart?? :popcorn2:

if corn prices skyrocket due to cannabis being grown, subsidies still won't be necessary, because more farmers will want to grow it again. problem solved either way.
 
Each year, the US government spends several billion dollars subsidizing corn. By some measures, it is the most-heavily subsidized crop in the US. Most of the corn goes into animal feed as a substitute for grass, high fructose corn syrup, or ethanol fuel.

What changes would you make? Would you get rid of them entirely?

Pretty much yes, I would just end them entirely. A plethora of other subsidies as well.
 
I honestly don't know the answer to this question. Not being as informed as I'd like, I'm not sure if this is just a big agriculture lobbyist bought and paid for hook-up or does it meet a real need that otherwise would result in a food shortage crisis.

At a minimum I think its ridiculous that the taxpayers could be financing diabetes, heart disease, obesity and early death of Americans. Much if not most of the corn produced in America is used to create what some experts say is a very unhealthy sweetener, high fructose corn syrup and high empty calorie corn starch filler, both of which is added to nearly all of the food on the shelves at our grocery stores. Then, conservatives get duped again with slick PR ads on TV that suggest an overreaching government is trying to encroach upon their freedom by simply educating them that their (corporate welfare paid for) soft drinks are unhealthy and the government and especially the Office of the First Lady and the Mayor of New York need to stop "forcing" Americans to eat and drink what they allow. They hilariously forget the fact that every time they have a soda, the "get the government out of our lives" crowd is chugging down an ice cold glass of welfare!
 
no vote
I do not know why we have them, there may be a good reason. The people(like me and many other opinionated old fools) should never vote on something like this, few (NotquiteRight for one) have the necessary knowledge, IMO.
And, our Mr Not Quite Right so elegantly posted, there are good reasons for the subsidies...knowledge requires that one gets his hands dirty with the actual experience...
 
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Sure.. Nobody will grow corn and the cost of corn will sky rocket..
Actually they will lose a price floor, non-competitive businesses will have their market share taken by efficient ones, and the price of corn will drop dramatically.

Because the subsidies that we have in place today are designed deliberately to keep prices high. I remain amazed at how few people really appreciate this.
 
Of course some of these subsidies are necessary.

The oil and sugar industries in America would never be profitable without the subsidies they receive.
 
no vote
I do not know why we have them, there may be a good reason. The people(like me and many other opinionated old fools) should never vote on something like this, few (NotquiteRight for one) have the necessary knowledge, IMO.
And, our Mr Not Quite Right so elegantly posted, there are good reasons for the subsidies...knowledge requires that one gets his hands dirty with the actual experience...

It seems to be centered around the action of controlling prices, and keeping them from dropping too low. It's similar to the subsidization in the dairy farm business back in the 60's, when one of my uncles shut his operation down, because he was paid to do so by the government.
 
I honestly don't know the answer to this question. Not being as informed as I'd like, I'm not sure if this is just a big agriculture lobbyist bought and paid for hook-up or does it meet a real need that otherwise would result in a food shortage crisis.

At a minimum I think its ridiculous that the taxpayers could be financing diabetes, heart disease, obesity and early death of Americans. Much if not most of the corn produced in America is used to create what some experts say is a very unhealthy sweetener, high fructose corn syrup and high empty calorie corn starch filler, both of which is added to nearly all of the food on the shelves at our grocery stores. Then, conservatives get duped again with slick PR ads on TV that suggest an overreaching government is trying to encroach upon their freedom by simply educating them that their (corporate welfare paid for) soft drinks are unhealthy and the government and especially the Office of the First Lady and the Mayor of New York need to stop "forcing" Americans to eat and drink what they allow. They hilariously forget the fact that every time they have a soda, the "get the government out of our lives" crowd is chugging down an ice cold glass of welfare!

An excellent post....., I even agree 99%....
As a diabetic, I've had to cut back about 90% on all the sugars..
Our diets in general are horrific, and ads do not help.
Education, and NOT from the conservatives , either, is the answer....
 
First if the subsidies are halted many acres of land would go out of production in the basic crops we depend on. Corn, wheat, soybeans are the biggies. The subsidy generally covers the average costs of production, the elevator price is profit. (not always as any hike in a production cost can easily overlap the subsidy check, the biggest is oil, it is fuel for both production and hauling but a big factor in the cost of fertilizer and boy howdy we use the crap out of that, next are pest/herbicides)

Now the posted price is rarely what a farmer gets because that price is for the mythical perfect bushel- shriveled kernels count against the price along with any weed seed/parts found in the sample.

So a lot of the marginal land would come out of production as without a guarantee of at least your seed money back fewer farmer are willing to risk the costs. Prices WILL NOT, I say again all after prices WILL NOT fall but rather rise dramatically because fewer acres in production will drive the commodity (better named speculative market) higher.

The basic principle of farm/crop subsidies is beneficial, over the years it has been corrupted by lobbyists farmers. The purpose was to guarantee a certain POTENTIAL level of production so that drought, early or late freezes, heavy rains that delay planting or ruin some areas right at harvest- nothing worse than a late may heavy hail storm in the wheat belt, the crop gets beaten down and lost JUST days away from harvest- would not cause famine or drive the price of food too high for lower income folks. (we used to have periodic shortages as bad weather or speculative runs in both crops- tobacco in early days, cotton later- and the market drove food costs above what many could afford)

To receive the subsidy the farmer or corporation must register the acreage, meet certain guidelines and annually report the numbers of acres planted to whatever crop. This way the USDA and speculators have a handle on what potential production can be. Weather and input prices get factored in for production purposes but what subsidy the farmer receive is mostly set in stone- sometimes a supplemental payment is made in the case of extreme drought or heavy spring rains but the procedure to approve such a payment can make you take up drinking.

Anyway the free market can't create a surplus in production to insure enough food in the case of drought or untimely rains. Some sort of mechanism to insure a surplus so droughts and input cost spikes don't create food shortages is required in a modern society. Regulating the manipulation of the system for speculative profit is required.

There are so many places in the food production system where reform would be helpful, perhaps capping the total amount any one corporation/farmer can receive each crop cycle would be helpful- though the dodge is to simply create more, smaller corporation 'farmers'. Limiting the swings and capping trade in the commodity market may help.

Throwing the baby out with the bath water when it comes to subsidies would be very interesting, but I don't think many 'libertarians' would appreciate the results...
 
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