Given Rising Food Prices and Ethanol Demand, Do We Still Need Farm Subsidies?


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Every five years, Congress must renew the legislation that provides subsidies to farmers. One has to wonder, given the election climate, if any serious consideration will be given to overhauling the system in the light of rising demand for Ethanol?

With the potential for crops to be used as an energy source, Congress needs to reconsider whether subsidies should continue to be doled out to pay people to not grow crops.

Also, consider the rising prices of groceries. Many factors contribute to the cost: Ethanol demand, rising transportation costs, rising standards of living in foreign countries. However, the fact remains that prices are higher; and, that opens the door to farmers having markets to sell their crops.

Lastly, consider who receives the subsidies. A group called the Environmental Working Group has wrestled a database of recipients away from the USDA and the numbers might just shock you:

"While two-thirds of U.S. farmers receive no farm subsidy payments, American taxpayers have been writing farm subsidy checks to wealthy absentee land owners, state prison systems, universities, public corporations, and very large, well-heeled farm business operations without the government so much as asking the beneficiaries if they need our money," said Ken Cook, president of the Environmental Working Group. "Even if you live smack in the middle of a big city, type in a ZIP code and you'll find farm subsidy recipients. Surely we can come up with a smarter investment portfolio for agriculture and rural America than the list of 1.5 million subsidy beneficiaries we are publishing today," Cook said. "America's farm subsidy system is broken. It's time for change."

It's time we take a serious look at subsidies. I'm sure there are farmers out there that could use assistance like 0% interest loans to update their equipment and such, but paying people not to grow crops when the demand is rising in all sectors is just wrong.

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