Northeast Nebraska and Candelaria Philippines | It doesn't take much research to figure out cutting production is bad for the economy. Other nations will just pick up what we don't produce.
The economy thrives on low raw material cost.
How did the set aside program work in the past?
I don't know what to tell the producers that don't understand this economic principle that cutting production isn't a long term solution. I guess they need to start studying history, rather than just looking for something to bitch about.
I agree the government spends too much money. But if you think ag subsidy should be cut in order to improve the economy, you are mistaken.
1. cutting subsidy would decrease production. This would mean fewer exports, and be a negative on the trade balance.
2. Decreasing production would raise raw material cost. This would affect cattle producers, General Mills, ethanol production, IBP profit, ADM's profit, even walmarts profit. Who do you think is making the money selling ribeye steak for 12.99 a lb? How much tax money is this generating?
3. Land prices would decrease. Wealth would disappear
4. AG Property tax base would decline, increasing the tax burden to urban areas
My personal "guess" is that the subsidy doesn't cost tax payers a single dime, it may even make the tax payers money as this money gets cycled through the economy and taxed and retaxed.
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Margin Protection Crop Insurance - GRIP on Steroids
