Agriculture Report: Government Agricultural Aid In The USA
In general, what are the advantages and or disadvantages of the governmental agricultural programs that we discussed in class?
What was supposed to be a temporary solution by the U.S. government to help farmers recover losses in 1933 during the times of the great depression has turned out to become an indefinite resolution that still exists today. The problem, oddly enough, is not the farmer's failure to meet demand, but their ability to exceed it, which saturates the market. The negative effect, in turn, drives the prices of food down dramatically causing farmers to sell their crops at lower prices, resulting in farmers not being able to recuperate their costs. Good for the consumer, bad for the farmer. With government intervention, the surplus is purchased and therefore taken off the market. This stabilizes prices, but the government is still left with the surplus that has to be allocated or stored. As discussed in class, the storage of the surplus, as with most things in life, isn't free. A notable disadvantage is the estimated cost hovering around $40 million per year, courtesy of the taxpayer dollar. Moreover, the surplus that is not able to be stored goes to waste in most cases or given away for free to the malnourished, various schools, and as foreign aid all at the expense of the taxpayer dollar.
The main disadvantage is there are no incentives for farmers to become more productive in the cultivation and harvesting of crops other than what the government provides as resources. Farmers have become too dependent on governmental assistance and it has become a vicious cycle. Regardless of how well their growing season is each year, farmers will still receive a check in the mail from the government if their net income falls below their fixed costs and expenses.
On the other hand, there are many advantages to governmental agricultural programs. According to Robinson in article II.C1, "...the reasons most frequently cited for intervention are to insure adequate food supplies, protect and preserve small-scale farms, reduce price instability, and minimize dependence on imports." These are all valid reasons that have been reinforced by class discussions. If not for the government assistance programs for farmers, the variety of food that we have today would no longer be feasible.
The consequences that would take place if these governmental agricultural programs where not in place would be devastating for both home and abroad because, as cited in class discussions and notes, we export forty percent of our food to other nations. In essence, the advantages of these programs keep our economy moving. More importantly, it prevents farms from becoming extinct in America. This would lead to the U.S. being dependant on food imports, which the consumer ultimately would be paying the price for by being left with fewer selections among fruits and vegetables and higher overall prices. All the fruits and vegetables that we take for granted today are readily available at our local supermarkets year round at reasonably low prices compared to other countries. As a supplement to framers, the programs also provide agricultural research services to increase efficiencies in farming through the application of technological advances. Additional advantages include collaborative marketing programs to promote areas of agriculture like dairy products such as milk and cheese.
