It will create nothing but chaos unless the big money boys, the government, and all insiders kindly bow out. I understand what your saying, but here's the rub......are we supposed to be that stupid to believe if Joe farmer to the north is selling beans, that Fred farmer to the south knows enough to grow corn?
It's not a case of stupid or smart, it's a case of economics. Corn and beans are both profitable because they're cheap to crop, but neither Joe nor Fred is gonna grow cotton or rice or anything else that doesn't produce high profits, regardless of its status as a commodity. Cotton, rice and everything else will be imported, at greatly inflated free market prices. After a year or two when corn and beans are no longer profitable, they turn to whatever has spiked in price in the meantime, like rice or cotton, assuming they aren't broke because the price of beans and corn dropped through the basement floor.
You really need to learn that a commodity is more than just something that gets traded on a stock exchange so evil people can profit from it. When you eat wheat you cannot tell whether it was grown by Fred or Joe, or Sergei in Belarus or Ling Ling in China or Larry in Canada. More of the Earth's surface is covered by wheat than any other crop. But wheat is behind corn and rice in production. That means you can produce more rice and corn per acre than you can wheat. That also means that, without world commodity price controls, market stability and reliable supply, both Fred and Joe would be growing corn or rice, not wheat. Wheat would become THE money crop and would cost several times more than it does now. Fred and Joe start growing wheat, like every other farmer on the planet trying to make a quick buck this season, and the price of corn, rice and beans then go up because the demand is far greater than the supply, while wheat plummets. If's a vicious circle with no stability in prices or supply whatsoever.
This country grew enough to feed the whole world until the government started all this stuff....and we could still do it.
That sounds good, and you may actually believe it, but it's not true. The Homestead Act of 1862 created conditions where farms went from 2 million in 1860 to 6 million in 1905, and we were poised to be able to feed the world then, but between the early 1890s through about 1910 many of those Plains Homesteaders (more than 50% of our agricultural production) were financially ruined because of tornadoes, blizzards, drought, hail, floods and grasshoppers which wiped out entire crops. Then, the period between 1910 and 1914 became the "Golden Era" of farming that organized groups of farmers, small family farmers each and every one of them, got together and demanded that the government use that period of time as the benchmark for the levels of production and prices they felt they should get, instead of the wildly varying production supply and prices they had been getting up to that point.
WWI certainly helped, since nearly every European farmer was in the army. European production was virtually non-existent, and US production went up, so did prices, everything was good. Right up until 2 years after the war when the European farmers got back in the game and American farmers nearly lost everything due to increased supply and severely depressed prices. Worse, hundreds of thousands of farmers had taken out mortgages and loans to buy out their neighbors' property, and new more mechanized equipment that allowed fewer farmers to farm more land, and they were now are unable to meet the financial burden. The cause was the collapse of land prices after the wartime bubble when farmers used high prices to buy up neighboring farms at high prices, saddling them with heavy debts.
This is all pre-farm subsidy. This is what you get with no controlled and reliable commodity supply. It was a disaster. That's when millions of farmers got together and demanded relief and stability, and it almost came in the manner of the McNary-Haugen Farm Relief Bil, but Coolidge vetoed that and instead went with a plant to modernize farming by bringing electricity to rural farms, more efficient equipment, better seeds and breeds, more rural education, and better business practices. On the heels of that came the Farm Security Act to raise farm incomes by raising the prices farmers received, which was achieved by reducing total farm output and controlling on a wide scale the production and supply of commodities. In 1933 the Agriculture Adjustment Act took this further to attempt to raise prices for commodities through artificial scarcity. In order to do that, they plowed up more than 10 million acres of growing cotton, 15 million acres of perfectly good crops were left to rot in the fields, and millions of baby pigs were destroyed and discarded. Less produced, the higher the wholesale price and the higher income to the farmer, and farm incomes increased significantly in the first three years as prices for commodities rose. However, food prices remained well below 1929 levels.
Because many farmers were paid to let fields remain barren (the old joke of the farmer who gets paid to not grow corn), the Supreme Court found that to be illegal welfare and the plan was replaced by having those farmers plant either soil-enriching crops that wouldn't go to commodities markets (like alfalfa) or other non-commodities crops like carrots, lettuce, tomatoes and cucumbers. These alternative crops created markets of their own and turned out to be at least somewhat profitable when combined with the subsidies. Without the subsidies, they would not be farmed. Federal regulation of agricultural production has been modified many times since then, but together with the large subsidies the basic philosophy of subsidizing farmers to control the supply and the commodities market continues today.
Joe should be able to say in effect......"I'm going to grow corn this year and send 25 bushel an acre to Ethiopia via a private shipping company employing 250 people off the east coast shipping lane." He sets up the private contract, ships direct o the yard, and tracks it to those who need it. Can he do this? No, and why?
Because there is no such private shipping yard, the gov regs will kill him out of the gate, and the bureaucrats will eat the profits alive with the agency assigned to ensure there is no harmful ingredient in the corn. But if Monsanto label is on the corn (with all it's toxic ingredient) it's then OK to ship and everyone but Joe makes money while the corn probably will never reach it's target of 25 bushel an acre.
Joe used to be able to do that, prior to WWII. It was a disaster. It rarely worked, and when it did Joe usually ended up with less money for his crops than if it went on the world market.
Regulations and programs are not there to help you.....it's to turn a profit for them. Turtle is right, it's all out in the open.
All you have to do is understand it, and more importantly, understand it completely, it's history and how it all works, and what happens when you eliminate the world commodity controls and subsidies, and just how quickly it all falls into chaos and disaster.
