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| Just a thought here. As I said in an earlier post, I remember making a cash flow spreadsheet back in the mid 80s and being surprised at how much of my income came from the government. While that undoubtedly prolonged the cycle low, it was the reason many farmers survived that time - me included.
Switch to today. Given massive production, increasing debts, ASF growing in importance still, and our inability (much like the 80s) to reduce input costs, what is really different today? Again, as I've said before, the mid 80s saw boom times on both the east and the west coast, and the money flowed into the center. Massive amounts of money. Just wondering out loud here, but could it actually be that these tariffs might actually be a blessing? Without the government taking some responsibility for the situation, wouldn't it be unlikely that the money needed to help a great many farmers survive might not be available?
I would ask - how else are many going to weather this major cycle low? Will we see the unthinkable again - set-asides? Are we already seeing the beginnings of this with the promise of government purchases on the demand side? There might be no choice but to control supply - at least for a short time.
Remember, this might be an opportune time, as elections are coming, and Donald Trump does not like to lose!
One interesting aspect - if, indeed we do see something like this - is that the really big losers would be those who have never given any thought to losing - the Big Multinationals. Just think about the political uproar from the senators and congressmen they own. (I believe it has already started.) Could it be that income from these tariffs will be used to fund these programs?
Anyway, not that I like the idea of government control, but when it came to me, I have to say that it did make me laugh. | |
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Tariffs - and surviving the cycle low
