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Farm bill includes billions aimed at keeping dairy industry afloat

trouble13 said:
What is your solution

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Years ago the provincial government here (B.C.) used to subsidize local wine producers. They made some really nasty plonk here then, made cloyingly-sweet porchclimber out of jelly grapes and didn't care because the subsidy kept them in business. Some time ago the subsidies ended. Some producers couldn't make it and folded but the good ones found ways and means and now B.C. wines win awards.

In other words you might curry favour with farmers with sibsidies but you don't do the industry any favours.
 
Grand Mal said:
Why does it have to be all or nothing? Either the industry grossly over-produces and needs to be subsidized by the government or the industry needs to be ended? Can there really not be something between the extremes that will work?
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I think if there is free trade between countries in these industries... there should be no problem. But when there are huge tariffs.... like in Canada on the Dairy industry.... The domestic dairy industry can't compete, unless it was heavily subsidized.
That is at least the argument...

Good luck with getting Canada or Mexico to agree to free trade... they like their tariffs just as much as Trump likes his. Which is the whole reason why this started in the first place. Trump made a good point... why are countries tariffing/restricting our goods when we do not do it in return? It is a bad deal. Now, is what Trump doing the best way of going about it? I don't know for sure, but probably not..... I haven't heard of any alternative that would actually work...

What we needed, was a Trump that was a 100% better negotiator. Trumps "Art of the Deal" doesn't seem to work in politics, because you always have to take into account people losing face and emotions.
 
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Praxas said:
According to folks like you, let the companies fail. If they were good, they could stand on their own. That's what cons said about Obama's picking winners and losers. Oh how your hypocrisy flows.
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Rather than dazzling us with your amazing psychic abilities and telling me what I'm thinking how about you tell us what you think the solution is.

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Grand Mal said:
Years ago the provincial government here (B.C.) used to subsidize local wine producers. They made some really nasty plonk here then, made cloyingly-sweet porchclimber out of jelly grapes and didn't care because the subsidy kept them in business. Some time ago the subsidies ended. Some producers couldn't make it and folded but the good ones found ways and means and now B.C. wines win awards.

In other words you might curry favour with farmers with sibsidies but you don't do the industry any favours.
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I agree with everything your saying here but there is also more to consider here. FTR I am not a fan of subsidies in general but there are times and places when they have beneficial uses.

When they are used to keep essential products affordable to the poor. I consider that would be at least an arguable reason to look at subsidizing something. Food falls into that catagory.

So while I agree with what you posted I question what the consequences would be for removing the subsidies.

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trouble13 said:
I'm not clear on what your arguing for?
Higher milk prices?
Letting dairy farms go under?

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I'm not "arguing for" anything.

I just pointed out that, regardless of trade agreements, countries have a recognized right to impose tariffs in order to offset subsidies paid by the government of the exporting country which enable the producers in the exporting country to sell their product below the cost of production.

Mr. Trump negotiated NAFTA 2.0 on the basis of existing American farm subsidies, now he has changed those farm subsidies. That gives Canada and Mexico the legal justification to impose tariffs on items that would not have had them imposed if Mr. Trump hadn't changed the rules in mid inning.

You might want to take note of the fact that it is a basic tenet of capitalism that producers who cannot at least break even SHOULD go belly up. American dairy farmers cannot break even. Ergo ...

Of course, you could always "go all socialist" and give the inefficient producers government money in order that they could stay in business, but that would never happen in the US - would it?
 
It's not socialism if someone who claims to hate socialism does it.
 
TU Curmudgeon said:
From United Press International

Farm bill includes billions aimed at keeping dairy industry afloat
​

EVANSVILLE, Ind., Dec. 27 (UPI) -- With years of low milk prices driving American dairy farmers out of business, the federal government plans to pour billions of dollars into new support programs.

The goal of the Dairy Margin Protection Program -- part of the 2018 farm bill signed into law Dec. 20 -- is to guarantee that farmers earn a certain amount for their milk. If farmers' earnings drop below a minimum threshold, the government will cover the difference.

"The program looks to be very generous," said Andrew Novakovic, a professor of agricultural economics at Cornell University. "The money should help [farmers] keep even with bills and maybe catch up a bit."

This is welcome news to struggling farmers, many of whom have not made any money since milk prices dropped in 2014, Novakovic said.

COMMENT:-

In most of the world payments by a government to a national industry that will enable that industry to sell its products at less than the cost of production are known as "subsidies". Those "subsidies" are almost universally considered as complete legal justification for the imposition of "duties/tariffs" on the product to protect against "dumping".

How this will impact the absolutely massive 0.3% increase in the share of the Canadian milk market that Mr. Trump achieved by his stunningly brilliant negotiations on NAFTA 2.0 is yet to be determined.

Don't bet that the impact will be beneficial to American milk producers.
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They mean years of over production because of Govt. price guarantees otherwise known as subsidies are coming home to roost. Minnesota alone has more dairy cows than ALL of Canada.
 
Mr. Invisible said:
I don't think it's a Trump thing per se, we've always heavily subsidized our dairy industry.
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Trump is unique only that he blamed our ally Canada for our overproduction of milk which has cratered prices. We pay subsidies to encourage more overproduction instead of regulating supply to match demand. That's the lobbyists at work.
 
If the government is going to guarantee profits I guess it’s time for me to start a dairy farm.
 
iguanaman said:
They mean years of over production because of Govt. price guarantees otherwise known as subsidies are coming home to roost. Minnesota alone has more dairy cows than ALL of Canada.
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The US government is VERY firm in its position that "price guarantees" are NOT "subsidies".

"Subsidies" are what THEY do and which allow us to impose tariffs.

"Price guarantees" are what WE do and imposing so-called "tariffs" to offset them is an "unfair trade practice".
 
TU Curmudgeon said:
The US government is VERY firm in its position that "price guarantees" are NOT "subsidies".

"Subsidies" are what THEY do and which allow us to impose tariffs.

"Price guarantees" are what WE do and imposing so-called "tariffs" to offset them is an "unfair trade practice".
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LOL Whatever you call it the result is the same. Too much milk.
 
Deuce said:
If the government is going to guarantee profits I guess it’s time for me to start a dairy farm.
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Or you could grow sugar..... It's an industry with 4500 growers and $4 billion in subsidies. Guaranteed profits too. Americans pay twice the world market price for sugar as a result. It's no wonder all our candy companies have moved to Mexico or Canada. It's not because of cheap labor.
 
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TU Curmudgeon said:
From United Press International

Farm bill includes billions aimed at keeping dairy industry afloat
​

EVANSVILLE, Ind., Dec. 27 (UPI) -- With years of low milk prices driving American dairy farmers out of business, the federal government plans to pour billions of dollars into new support programs.

The goal of the Dairy Margin Protection Program -- part of the 2018 farm bill signed into law Dec. 20 -- is to guarantee that farmers earn a certain amount for their milk. If farmers' earnings drop below a minimum threshold, the government will cover the difference.

"The program looks to be very generous," said Andrew Novakovic, a professor of agricultural economics at Cornell University. "The money should help [farmers] keep even with bills and maybe catch up a bit."

This is welcome news to struggling farmers, many of whom have not made any money since milk prices dropped in 2014, Novakovic said.

COMMENT:-

In most of the world payments by a government to a national industry that will enable that industry to sell its products at less than the cost of production are known as "subsidies". Those "subsidies" are almost universally considered as complete legal justification for the imposition of "duties/tariffs" on the product to protect against "dumping".

How this will impact the absolutely massive 0.3% increase in the share of the Canadian milk market that Mr. Trump achieved by his stunningly brilliant negotiations on NAFTA 2.0 is yet to be determined.

Don't bet that the impact will be beneficial to American milk producers.
​
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I thought all those Republicans rallied AGAINST "picking winners and losers".
Haven't we heard them being all triggered about "Obama's Government Motors" and what not?
 
iguanaman said:
LOL Whatever you call it the result is the same.
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Not true.

The American government is 100% justified in imposing crushing tariffs on stuff that other countries "subsidize" (read as "produce more cheaply that can be done in the United States of America and produced by companies that aren't owned by Americans").

NO country has any right to impose any tariffs whatsoever on American goods that are produced by American owned enterprises situated in the United States of America regardless of how much money the government of the United States of America gives to the enterprises producing those goods.

That's "THE LAW" and that's the way that the US government enforces it.

iguanaman said:
Too much milk.
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But it was the very best milk.
(with apologies to Charles Dodson)
 
iguanaman said:
Or you could grow sugar..... It's an industry with 4500 growers and $4 billion in subsidies. Guaranteed profits too. Americans pay twice the world market price for sugar as a result. It's no wonder all our candy companies have moved to Mexico or Canada. It's not because of cheap labor.
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What you have to remember is that, if it wasn't for sugar then Hawai'i would still be an independent country and hundreds of thousands of American WWII casualties simply wouldn't have happened because the Japanese would have had no reason to attack the Kingdom of Hawai'i (and the US government wouldn't have cared any more about it if they had then they cared about Hitler's attacks in Europe).
 
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