Why is it important for our government to pay farmers to NOT grow certain crops?

Question

This is something that has always puzzled me. What is the point of this?

The two crops I can easily think of, that this concerns, are corn and soybeans. We're growing corn because of this big ethanol theory, but soybeans are in a lot of what we eat nowadays... and corn is used to feed livestock, as well as it being a filler in a lot of the food we eat.

Answer 1

There are many crops that the Govenment pays farmers NOT to grow. The rationale is that by growing less of a certain crop, the parity (or price) of the crop will be maintained. If too much of a crop is grown, the prices will fall, hurting farmers, and thus the banks that finance them. This in turn can cause businesses to fail, people to become unemployed, etc.
I have no doubt that the Government can figure out a better solution than that.
I would submit the peanuts vs. soybeans situation: peanuts are subsidized; in fact, you can NOT just go out and grow peanuts. You have to be like former President Jimmy Carter and belong to the peanut growers association; there is some kind of lottery or whathaveyou that allows certain people to grow peanuts. Any others, well, they can grow peanuts, but the peanuts can NOT be sold for human consumption within the United States, meaning they will get lower prices for their crops. Soybeans, on the other hand, are not subsidized, and are sold for lower prices, even though in many respects peanut crops and soybean crops are so similar.
You mentioned corn for ethanol; basically, if it LIVES on planet earth, it can be turned into ethanol, so why not use weeds and brush for ethanol? Why raise the price of corn for human and livestock feed just because someone got a wild hair and decided to use corn for ethanol? Besides, according to the many articles I have read in business and popular science magazines, ethanol does not get as good mileage as regular gasoline.

Answer 2

At one time it was to make the prices reasonable so the market would not be flooded with a certain crop. This was when the majority of the US citizens were farmers. This no longer applies so many huge farming conglomerates say they are planting a crop just because they know the government will pay them not to!

It is outdated and no longer necessary. They should be using that money to offer an alternative to the smaller farmers to grow a product needed for an alternate fuel. It should also not be available for any farm that has not grown the product. You must first grow it and then you can get a subsidy.

Answer 3

actually it interferes with the free market, farmers will produce the amount necessary to stay in business if they produce to much of any product the price drops, even tho the price to produce it doesn't, if they cna't make enough money by growing corn they will grow something else.

I have a friend who is a farmer herself, and she said that she went to this seminar, and the speaker is a polyfarmer, he has a farm the produces year after year with little mainteance, he said the reason the government pushed for monoculture farming is to control the commidity of food, it is a way to control the population and keep prices high, which essentially controls people, excess is stored up. (now how about that they are paying farmers not to produce to avoid surplus but they store some nonetheless.

His farm is based on polyculture, he has corn, but he has nut bearing trees, fruit bearing trees, and grows crops together that compliment each other, he says one crop of corn is wasteful and does more damage to the enviroment, then if they would use that land for corn, with other crops and trees and fruit producing vines. the government actually tells farmers what they are to plant each year, the market and the farmer don't.

so much for the free market determining it, which means letting the producers and consumers determine what to buy or produce, the government is an intrusive middle man here.

farmers are literally blackmailed to do it the governments way, the poor farmer has to get into debt and never gets out to keep his farm up and running. so the bankers get to determine what is produced and how much, and I assure you the determining factors has nothing to do with our welfare and everything to do with profit.

the government does other things I heard about that interferes with the market too, but it is too lengthy to get into here. oh yea what better way to get rid of smaller farmers (thus competition) then by dictating what they can grow and how much money they will be allowed to make, thus if they can't make their payments, which is what they can plan to do if they want their farms, then he loses the farms to bigger agribusinesses which essentially creates a monoploy.

RRRR

Answer 4

It keeps prices up so farmers will farm and we have domestic food sources, even when crops are otherwise 'too good' that prices would drop to where it might not pay to be a farmer in the US.

The farmers in my family were disgusted at this, declaring proudly that they were simply 'too good as farmers' to be eligible for the subsidies. However, otherwise global trade would mean it isn't financially efficient to farm in the US, and if you think dependancy on foreign OIL is bad...

I'd really HATE to be dependant on foreign food.

Also, note that the EU put its similar subsidies in place following actual FAMINES in Europe after World War II when farming had been cut back due to low prices, and the destruction of war added to that meant there simply wasn't enough food.

Answer 5

To keep the prices up for the commodities. If they are flooded with let's say soybeans....then the price will be below the cost to grow and harvest. Then all the farmers would go bankrupt.

Answer 6

It does several things. When there is an over abundance of different crops the price falls. Also soil needs to rest to replenish itself with nutrients. If farmers did not have this type of price control many would go out of business. Then we would be buying even more goods overseas

Answer 7

This act, "supposedly" helps to artificially inflate prices on American grown food products.
However, our Government often sells this food to foreign governments cheaper than what we, Americans, pay for it. So, go figure......
Now, with the push for more ethanol, I suspect that this "subsidy" will be, (hopefully) ending soon......allowing our farmers to actually try to earn a living by working their land.
Not by sitting on their a**, and mowing grass.....remember, I wrote mowing grass, not growing grass.......

Answer 8

There are no US federal programs that pay farmers not to grow crops. Sorry, but you are misinformed.

Answer 9

ALL government interference in our live is bad.