That's why I referred to it a somewhat irrational price structure.
It's been a calculated mixture of free market forces and government control.
One particularly painful lesson was learned by me and a lot of other farmers in the early seventies.
After years of wrangling for an increased export market, a large shortage of grain in the USSR developed. US exporters scrambled, and landed several enormous grain export contracts with the USSR. Grain prices shot up, beans from $3 to over $10, corn similarly. The US government panicked, their Cheap Food Program in jeopardy.
Naturally, they stepped in a voided all the contracts. Overnight, for me what was to be a new truck and a nice vacation vanished into thin air. For cheap food.
As a young farmer idealist, I was stunned. We had followed all the 'rules' worked for and got those contracts, just as we had been hectored by all those speechwriters to do. And we ended up with nothing to show for it.
We have a free market, within the parameters set forth by those bureaucrats.
I never like those programs, neither did my father, but that’s what we had.
If we hadn’t, we would have had more money, and perhaps we wouldn’t have ethanol today.
I remember that, but I didn't know that the feds had voided the contracts. What was the constitutional authority?