Midwest ag sector is economy's bright spot

  • Article by: JOSHUA ZUMBRUN and S TEVE MATTHEWS Bloomberg News
  • Updated: November 26, 2010 - 8:59 PM

A boom in commodities prices has helped insulate agricultural heartland from recession pain.

  • 9
  • Comments

  • Results per page:
  • 1 - 9 of 9
minnokaNov. 27, 1012:28 AM

Great! Sounds like the perfect time to wean corporate agriculture off government subsidies. They don't need it, and we can reduce the deficit.

3
2
phantasm1Nov. 27, 10 5:36 AM

"he perfect time to wean corporate agriculture off government subsidies" Great idea, but it will never happen. CAN YOU SAY DFL

2
2
westwind911Nov. 27, 10 5:53 AM

Oil companies should be weaned off of govt subsidies as well.

6
1
mjumsuNov. 27, 10 7:28 AM

CAN YOU SAY DFL, NO, but I can say GOP! Gotta keep those subsidies going to Big busineses. Yes farming is big business!!

2
1
quadrant5Nov. 27, 10 8:41 AM

All the above are correct. BUT with 9.6% unemployment this would be a terrible time to wean American consumers off subsidized food. There would be riots in the street if the entire cost of food were suddenly transferred to the grocery store check-out line. Government Ag subsidies stimulate food production that normally would not occur. The surplus production then is allowed to affect the "market" and weighs down food prices. This is why the weathiest country in the world (USA)has the lowest food prices in terms of percent of disposable income.

1
3
crock2Nov. 27, 10 9:10 AM

Gee, you don't think farmers are doing "extraordinarily well" because of all the welfare (ooops, I mean "subsidies" -- wink, wink) they receive, do you?

2
0
bottomlineNov. 27, 1012:56 PM

So quadrant5 ....are you saying that the best running part of the US is it's food sector "because" it's the most "socialistically" run part?? C'mon man ...stop with the TV commercials advertising and promoting "why we need socialism".

1
0
bottomlineNov. 27, 1012:59 PM

And by the way, we NEED the subsidies to end. We NEED "the entire cost of food suddenly transferred to the grocery store check-out line". It's about time we pay this full price ...riots in the street or not.

3
1
Stone257Dec. 10, 10 9:47 AM

You may have noticed in the article a portion of price increases are a result of weather calamities in other countries. The same could happen next year in Minnesota, Iowa, Nebraska, North Dakota... It did when I was farming. Then price increases because of local as well as global supply and demand issues. The point is the ag economy, and food supply, is so dependent on weather in different parts of the world, which may cause shortages. Also, to not have subsidies for a particular foodstuff (wheat) may cause some substitution for another (corn). Right now most farmers would raise corn versus wheat because of some subsidies (ethanol) artificially increasing prices along with the current global market supply and demand reaction. But how many of us would like to eat corn bread everyday or pay $6 for a loaf of wheat bread. So wheat is subsidized through the markets in various fashion. History has shown the boom and bust in the food supply doesn't make for a stable economy. The drought during the Great Depression was particularly hard on the ag states' economies as well as the nation. There needs to be a balance of the subsidies with markets given technology, transportation and storage advancements. Objective ag economists at our universities and, in the long run, the market are the better ones (versus government)to study and address that balance. Currently, common sense would say not to subsidize some crops. There simply is not a need to do so given current market conditions. Government issues subsidies and is slow to react to the market, as usual. An of course politics are involved. Perhaps more time and effort should be spent on determining how the subsidies can be objectively established and how they can be administered more efficiently and effectively. Then the market most likely will react to the point the subsidies would be reduced substantially or even eliminated, without a substantial affect on food prices. Ultimately, in the long run the market will establish a floor price and food markets will be stable at a lower cost to taxpayers.

0
0
  • 1 - 9 of 9

Comment on this story   |  

ADVERTISEMENT

Connect with twitterConnect with facebookConnect with Google+Connect with PinterestConnect with PinterestConnect with RssfeedConnect with email newsletters

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT