Interesting info. I did know that food prices fell as a % of family income for some time (partially credit Earl Butz, right?). But I didn’t know the exact numbers. I wonder how much of the decline came from increased farm productivity, and how much from subsidies? And how much more in taxes did taxpayers shell out to fund the subsidies?
I assume that at some income level it goes negative: Ie., the tapayer pays more taxes either directly or indirectly to pay for the farm subsidies than they get back in lower food prices. So at some point it becomes another way to transfer wealth from higher income citizens to lower income persons (citizens or not.) Right?
As for “user friendly” - I’m really appreciating that right now, as my wife is gone for an extended period back home visiting family — you get the picture, I’m sure! :-)
Ahhhh... Earl Butz.
Mr. “Plant Fencerow to Fencerow!”
Yes, Earl was, in part, responsible for the low prices of commodities. But, he could affect only ag commodities. If you looked at the macro charts of most all commodities from the early 70’s to about 2002, you’d see that prices went down, adjusted for inflation.
Gold went down. Silver went down. Both peaked right about the same time as ag commodity prices last peaked.
Oil came down. Remember oil at $15/bbl? When we started farming in 1999, I seriously considered replacing 200HP electric irrigation pumps with diesel engines. On paper, it looked like it would be a suave move.
Older farmers told me “Don’t go there.... we’re here to tell you that one day soon, prices will shoot back up again and you’ll have to put the electric motors back on... just stay put and get other things done.” I’m glad I listened to them - in the space of only seven years, we would have been broke feeding those diesels.
Old (I’m talking in their 80’s old) farmers could have told you that his all was coming. They’ve seen it before. They remember the last debt deflation. They’ve seen these cycles come and go. They knew that they had to do 20 years “on the outs,” and now they’re going to have their 10 years “on the upside.”
Farming, more than anything else, taught me the wisdom of listening to old guys. I buy old guys a shot or two at a bar in a small town where they still “make something real” and then sit back and learn.
It appears you have a firm grasp of just how that whole farm subsides/food prices connection works. Very, very few people do.
I think the biggest single reason for subsidies, is cheap food, not the farmers votes. Ethanol excluded perhaps.
No politician wants to face a voting block enraged at high food prices, and so they vote for subsidies, blame the farmer, reap cheap food prices. It almost seems like everyone wins. Except, of course, they don’t.