Farm Program Prospects
Aug 04, 2011
Congress is scheduled to write a new farm bill next year. It’s not going to be a carbon copy of the one we operate under today. Secretary of Agriculture Vilsack said, “The old days are through.” I have to agree.
In the “old days” back in the 60’s and 70’s, we had land retirement programs to reduce production which was designed to short the market and raise the prices. Still, the prices were low and to help keep farmers in business, to keep them producing “cheap food,” the subsidies were just part of farmers’ income. In the 80’s and 90’s, we saw evolutionary farm program reform, but the subsidies continued to flow, encouraging production. Stable food prices and abundance was the objective. It was a “cheap food” policy and it worked.
All of a sudden, we have seen an explosion in farm prices. A price explosion that we never imagined could happen. Not just $7 corn, but almost everything has shot up.
With farmers getting all of this money out of the marketplace, they don’t need any government help anymore. That is the climate in which the next farm bill will be written. And with the debt burden that the country shoulders, the pressure to cut will be powerful. That is the reality that we must accept.
However, some kind of safety net such as crop insurance would help farmers deal with destructive weather which we cannot control. Some support for farmers would also benefit the consumer. Subsidies to farmers over the years have helped to keep farmers in business.
I am delighted that we are now taking our marching orders from the market and not the government. However, to those that want to take away all farm program support for farmers, I repeat, what Pro Farmer Publication had to say – “Be careful what you ask for.”
In closing, I would encourage you to access my website which archives my radio commentaries dating back 10 years and will go back 20 years when complete. Check on what I said back then. Go to www.johnblockreports.com.
Until next week, I am John Block in Washington.