Speaking as an actual farmer, I can say that almost everything you just wrote is wrong and has been not true since the “Freedom to Farm” act of 1996. There are no more subsidies to “bring up commodity prices.” There are marketing loans, loan deficiency payments, support for conservation/wildlife purposes, etc, but there are no more price supports for maintaining minimum commodity prices.
As to sheep numbers: imports of lamb from Australia and NZ increased throughout the 90’s. There are no limits on lamb imports from either Australia or New Zealand. Their below-cost exports to the US are a large factor in what has effectively killed the US sheep industry. When the US dollar was strong and the NZ/Aussie currencies were weak, they undercut the US sheep producers with meat prices that could not be matched. US Sheep numbers have increased slightly since 2004, in part because Australia/NZ’s currency started to strengthen against the US dollar.
During the Clinton administration, US sheep producers filed a WTO damages claim against the Aus/NZ sheep producers. By 2001, the WTO had ruled in the vast majority for the Aus/NZ producers and the US had to remove all the quota restrictions placed in 1998 by the Clinton administration.
And while commodity prices are higher than they have been in years, they still are at least 50% lower than they would be if you took commodity prices at the point we left Bretton Woods and adjusted those commodity prices for inflation.
My stories also come from actual farmers, and in both countries. What makes NZ an interesting comparison is that it represents the only country in which agriculture is totally unsubsidized. This forced farmes to become businessmen, and to push technology in innovative ways. They milk cows on giant carousels and have modified California pine trees to grow to maturity in half the time of their American counterparts. Even their research is private.
As of fall 2005, US import limits on NZ lamb were strict enough that NZ had to sell most of its production to the Middle East.
I listened to Senate debate on what is called a farm bill. It was enlightening as there was not much farm in the bill. All sorts of rural programs, in fact anything with the word “rural” attached was tossed into the stew.
When the farmers’ costs start eating into grain prices who is going to complain about low farm income?