Posted on 07/12/2018 4:59:13 AM PDT by reaganaut1
When pork prices collapsed amid a global trade war during the Great Depression, the Roosevelt Administration in 1933 had an ideaslaughter six million piglets. Put a floor under prices by destroying supply. It didnt work. Now the Trump Administration may try its own version of Depressionomics by using the Commodity Credit Corporation (CCC) to support crop prices walloped by the Trump tariffs: Hurt farmers and then put them on the government dole. How about not hurting them in the first place?
Thats the question as Mr. Trump escalates his trade war, on Wednesday proposing 10% tariffs on $200 billion in additional Chinese goods. China says it is shocked by the new border taxes and will look to retaliate againand no doubt U.S. agriculture will again be one of its main targets.
Enter the forgotten but alas not gone CCC, the financial institution that FDR charged with solving the problem of depressed markets caused by weak demand. Farmers were told to plant less in exchange for a floor under prices. The CCC financed the purchase of surpluses through nonrecourse loans to farmers, and held the crops in storage.
When market demand improved, the Agriculture Department was supposed to sell the stored commodities at higher prices. Nonrecourse meant that the farmer didnt have to repay the loan, and the USDA often couldnt unload the surpluses because demand didnt recover.
The Depression ended but the CCC kept going. In 2012 Congress put limits on CCC purchases of surplus commodities and on price supports after the Obama Administration used it for a costly 2009 disaster program without Congressional approval. But then out of the blue this year, Congress lifted the limits on CCCs power to remove surplus crops from the market to support prices.
(Excerpt) Read more at wsj.com ...
And who is going to feed you?
Well that happened.
And before that happened, a monopoly by a few seed licensing companies took control of seed breeding and and partnered with the largest public universities seed programs. (Monsanto is another such company, China attempted unsuccessfully to buy.)
And factor in seed licensing laws written by lobbyists of the seed breeding cabals.
Result? Fed more lawyers, more bureaucraps and more record keeping.
Yes, we raise planting seed. And abide by the seed laws. But that has nothing to do with mother nature.
“Farming is easy, if your pencil is your plow and the nearest field is 1,000 miles away.”
What could possibly go wrong?
Last year the low market price for wheat chilled what was planted. Lowest acreage since the 1920’s.
And this is at a time when the dollar is at an all time high on exchange rate with many of our foreign customers. (at times more than 50% of US wheat production has gone to foreign markets)
So, yes I know the consequences of government decisions.
ChemChina’s purchase of Syngenta a win-win [Not Win for US] (view and article from China)
I respect your enthusiasm for Trump and his policies, but cheap pork or fewer markets will mean farmers will simply reduce growing pigs.
Argentina’s socialist government tried this in 2014 on their big beef export industry. The President Kirchner was a fan of Hugo Chavez. She thought - why not ban beef exports, and we’ll have plenty of cheap beef for poor Argentinians?
It worked for 3 months, when farmers slaughtered their cattle and packing plants shut-down. After that, domestic prices jumped higher than ever.
If weaker farmers go out of business or cut back on production, prices will rise, making it more profitable. Commodities in general always go through boom/bust, trade war or not.
The only help I’ll give them is stocking the freezer with cheap pork.
If muzzies ate bacon, they wouldn’t be so angry.
Prices for food in the US should be higher. It is insanely subsidized today between direct subsidies and food stamps.
How getting rid of subsidies helped New Zealand’s farmers.
When did that happen?
“Mr.”
Part of ripping the band-aid off is going to be changing what you grow. That, in my opinion, the government (or we) should pay for, yes, because we let it get this broken.
When you say “pig farmers” do you mean the corporate pig farmers like Tyson and Smithfield, or real farmers who raise a few pigs on the back 40?
It’s basic economics. Simple supply and demand. If you can’t make money producing something then you will stop producing it until the drop in supply causes the price to rise to the point you can make a profit again.
Yes, they will. I have worked in retail and hospitality my entire life - mostly in corporate management - and at $15-20/hr you can get legit quality labor just about everywhere but SF, LA, NYC and Boston
LOL you have no clue!!!
The tariffs are a means to an end.
This is all about staking out a negotiating position to cut better deals.
We have to do something to show our “trading partners” that the days of our bending over and saying “Please, Sir, may I have another?” are over.
O’bummer put in a program for farmers. Don’t farm the land and the GOV will pay you $375 an acre for 15 years.
4% of the U.S. workforce may be directly "involved" in agriculture, but that is far from a full picture. These crops don't just walk off the farm and end up with their end consumer by magic.
Every exported agricultural product has a lot of OTHER industries with a vested interest in agricultural exports. You have the barge and railroad industries that move grains to ports, along with elevator operators and longshoremen at the ports. You have all the industries that supply these, too. You also have the trucking company whose president I met with earlier this week ... whose contract to haul grain to an East Coast port may be in jeopardy if the global marketplace for his customers' products changes as a result of foreign tariffs.
I DO agree with the President on tariffs.
It’s the only negotiating tool that he can wield against countries that have took us to the cleaners FOR DECADES.
We have been losing the trade war for far too long and I am THRILLED to have a President that understands this fact and is letting these freeloader nations know that we’re not going to take it anymore.
This is a shell game, mostly.
Commodities don’t get affected by tariffs quite as much. There are lots of countries in the world that would like to buy American pork. Besides that, if China starts buying it from another country to dodge the tariff, other countries will happily sell more than they can deliver and make up the shortfall by...buying American pork.
China is basically in a no win position. The stuff we export to them that they can tariff is less affected by the stuff we tariff coming back from them.
We hold most of the cards.
Very likely result.
And we’ve owned/operated farms in this county since 1889.
Am not asleep about the issues.
They have retail food outlets. Their pulled pork bar-b-que sandwiches are incredibly good. (I have a recipe that is equal to it, came from family member in that business)
Next month we will be going to spend time in NC, and will have Smithfield Bar-b-que sandwiches more than once.
WSJ FAKENEWS
Wall Street Journal is a Welfare agency for cronies.
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