EU retaliation in steel war.

[Faeelin]

Dan: I know, we're almost becoming like Europe in regards to them.

This is a pretty low blow on Europe's part, and a stupid one at that. It's one thing to retaliate, it's another to escalate. When they target specific states like that, it does appear that it's designed to hurt the American president's chances. Therefore, it is meddling in American politics.

[Gatekeeper]

DanS, Colon:

I can assure you that farmers don't relish relying on the whims of Uncle Sam for their lifeblood, either. Low commodity prices — for years now, not months — consolidation creating ag giants such as ADM, ConAgra and Smithfield Foods, and the increasing "serfing" of farmers to land once owned by them (but now owned by corporations) have all combined to devastate farmers to a degree not seen since the early and mid-1980s.

The ironic thing is that *somebody* is making money somewhere because there really haven't been food price decreases among cereals, meats and whatnot. These prices keep rising (or staying steady sometimes) while the prices farmers get for their produce and animals regularly decreases. Heck, I remember when soybeans were fetching more than $6 a bushel; now its lucky to break the $4 mark.

I know one thing that local and state-level ag folks are doing where I live that could help: value-added agriculture. But it may be a case of too little, too late for many farmers.

Colon, is anything like this happening in Europe?

Gatekeeper

[DanS]

Gatekeeper: I know it's painful. But that's how inefficiencies are wrung out of the economy. If XYZ corporation making widgets can't compete on price or features, it goes bankrupt, to be replaced by a sustainable model. Farming should be no different.

[Gatekeeper]

Originally posted by DanS
Gatekeeper: I know it's painful. But that's how inefficiencies are wrung out of the economy. If XYZ corporation making widgets can't compete on price or features, it goes bankrupt, to be replaced by a sustainable model. Farming should be no different.

Yes, it is painful. Particularly when farmers have followed the sage advice of the economic know-it-alls for years and this is what they get.

"Get larger! It's the only way you can stay in business!" So that's exactly what farmers did — they expanded their acreages, buying out smaller ("inefficient") farmers. We went from have three to four farmers per quarter-section of land to one farmer owning all the land in the quarter-section.

"Plant more crops! It's the only way you can keep up!" So the farmers did that, too, with their newly-acquired extra acreage. That did nothing but flood the market with comoodities, animals and whatnot that the buyers suddenly didn't need, or didn't buy for various reasons.

"Modernize! Modernize!" So that's what farmers did. They went out and pumped hundreds of millions of dollars into the national economy by buying $150,000 tractors, $75,000 discers and so on. But with flucuating crop/animal prices, one couldn't count on being able to pay off the loans taken out to buy the equipment which was necessary to properly maintain these growing mega-farms/dairies/ranches.

"Use fertilizers! Ward off bugs and land exhaustion!" So that's what they did. They also rotated crops, let fields lay fallow and moved herds about .

I could go on for a while longer, but time is of the essence right now. Suffice to say, it seems to me that U.S. farmers — and others abroad, I bet — have followed the economic advice given to them over the decades and, in the end, it doesn't seem to helped as much as it should have.

Perhaps it's a no-win situation. But perhaps value-added ag and the willingness of people like me to buy from locally-owned facilities can give farmers a new lease on life. Then Washington can use those 10-year $67 billion aid packages elsewhere. But the farmers need government action taken in a form other than handing out money: help is needed to keep the corporations in check. Sen. Tim Johnson's meat-labeling and two-week ownership limitation on livestock for the big packers is that sort of non-monetary help.

Gatekeeper

[TCO]

Gatekeeper. DanS is right about inefficiencies. This is the way the free market works.

You raise a seperate but interesting point about the lower commododt prices not transferring to customers. If so, the right solution is probably anti-trust action against Tyson, et. al. This won't really help farmers though. It will help consumers.

[DanS]

Gatekeeper: So you would propose subsidizing all industries where the players make bad business decisions?

I guess I don't see any difference between the dot com going bankrupt versus the family farmer. If they are not viable business models, they need to be replaced. And ASAP.

[Lancer]

Guess I'll start drinking more juice...

USA! USA! USA!

(Where is good 'ol Derek when you need him)

[Colonâ„¢]

AFAIK margins aren't fat anywhere along the food-chain, not even amongst the big food-processing corps, they get their return through selling in large volumes. Subsidies aren't the solution, on the contrary, they often aggravate the situation by causing oversupply.

[TCO]

Colon, have you got any good analysis or articles on this issue (don't stay mad at me, buddy! ).

I have heard these claims that the commodoty price is dropping and the consumer price isn't. Wonder where the moeny is going. Or if this claim is even true.

[Saint Marcus]

I think you pulled this out of your ass. TIME didnt report anything.

Time magazine

April 1, 2002

Cover: Can the Catholic Church save itself?

Page 23

Section: Indicators

Headline: Swing in his steps

quote: E.U. Trade Commissioner Pascal Lamy is preparing a $2.1 billion "hit list" of tariffs to strike back at U.S. President Bush's steel duties. The tariffs would hit goods in the hotly-contested "swing states" that Bush will need to win the next election.


asshole

[Saint Marcus]

we can hurt you many...many...more times than you can hurt us. You do realize that?

doubtful

If Bush gets word of that. Oh you are in trouble.....

yeah. sure. whatever. there's little bush can do frankly.

[Sharpe]

Bush has to be very careful, although I am not sure that he realizes that fully.

Before 9/11 there were signs that he was beginning to irritate many of the other members of the western alliance with his Kyoto stance, the ABM treaty, drilling for oil in Alaska, and his refusal to sign certain other treaties and his whole "unilaterial" viewpoint.

With the recent trade actions against Canada for lumber and steel against most of the world (and the EU still seems to be annoyed about the bananas), that irritation may come back or get even worse.

For instance, Bush and his hardliner cabinet clearly want to attack Iraq... but most of the western alliance doesn't want to.

If Bush resumes his pre 9/11 path of unlateralism policies, he may lead to a split in the western alliance or possibly its destruction.

The strength of the US rests on 4 equal pillars:
its strong economy, its strong military, its strong alliances and the lack of a power or group of nations equal to its power.

The amount of disputes seems to be growing and the items that are being disputed are becoming more important. Steel is still a backbone of any economy, lumber is an important part of Canadian exports, even the anti-trust case against Microsoft (which Bush seems to have sided with Microsoft) is important.

Yes the US can hurt the EU badly, but the EU can hurt the US equally, perhaps more so politically. Either side though would have at best a pryrric victory.

Wow, long-winded post!

[Gatekeeper]

Originally posted by DanS
Gatekeeper: So you would propose subsidizing all industries where the players make bad business decisions?

No.

Most workers know how much they're going to get in a given check, and some have union protection, which offers even more security. Farmers don't have that protection. They don't have a minimum wage. They can't tell the three or so big corporations that control the markets what they will pay to the farmers for crops and animals. In a word, farmers have very little control over the decisions that can make or break their ties to the land. The only way they can try to earn an income is by planting crops and raising animals. Tough luck if the one corporation in town ain't offering enough to even cover the costs of planting/raising. America needs its cheap food and a free conscious, after all. Hell, if that means idling all the ag land in America and paving it over with developments, then so be it. We can always get our food "more efficiently" from other places, right?

Farmers were told to get larger, to modernize, to grow more crops in order to keep up. They did so and now some have the gall to say they made bad business decisions? Jesus. They listened to those who were supposedly "in the know," and it sure as hell hasn't turned out as expected. Maybe all the experts should be forced to walk beans for a weak or rogue corn for a day in order to get a little "in the field" experience to back up their advice.

The American farmer is among the most efficient in the world, and here we are having to bail them out because they can't make enough money to even cover the cost of planting the crop. There's something wrong when being efficient still isn't enough to make a buck.

Maybe you like on-sale 29-cent loaves of bread, but I can't help but think that while the consumer has an idea of what his or her bread will cost for a week, the farmer can't be sure of crop prices from the AM to the PM of a given day.

Perhaps they should dump their milk in the ditches, turn their crops into bales and kill the pigs, chickens and cattle. They might actually make a buck while sending a jolt into the industrial food supply chain. They used to do that sort of thing from time-to-time, but I haven't heard of it for at least 24 or so years now.

There's got to be some sort of middle ground. Right now things are unbalanced terribly in the favor of big companies. Perhaps value-added ag efforts is the ticket out of this whole morass. I guess only time will tell.

I guess I don't see any difference between the dot com going bankrupt versus the family farmer. If they are not viable business models, they need to be replaced. And ASAP.

I cannot agree. I've laid out some of my thoughts in regards to why above. Show me an inefficient, lazy, money-grubbing farmer and I'll show you a beloved IRS bureaucrat .

Gatekeeper

[Urban Ranger]

The ag sector seems to be not working along free market principles due to subsidies. I don't know where the money is going to, but farming in developed countries are killing farming in developing countries that opened their markets and draining their foreign exchange reservers as they now need to import food.

This is not a pretty picture.

[TCO]

Originally posted by Gatekeeper


No.

Most workers know how much they're going to get in a given check, and some have union protection, which offers even more security. Farmers don't have that protection. They don't have a minimum wage. They can't tell the three or so big corporations that control the markets what they will pay to the farmers for crops and animals. In a word, farmers have very little control over the decisions that can make or break their ties to the land. The only way they can try to earn an income is by planting crops and raising animals. Tough luck if the one corporation in town ain't offering enough to even cover the costs of planting/raising. America needs its cheap food and a free conscious, after all. Hell, if that means idling all the ag land in America and paving it over with developments, then so be it. We can always get our food "more efficiently" from other places, right?

Farmers were told to get larger, to modernize, to grow more crops in order to keep up. They did so and now some have the gall to say they made bad business decisions? Jesus. They listened to those who were supposedly "in the know," and it sure as hell hasn't turned out as expected. Maybe all the experts should be forced to walk beans for a weak or rogue corn for a day in order to get a little "in the field" experience to back up their advice.

The American farmer is among the most efficient in the world, and here we are having to bail them out because they can't make enough money to even cover the cost of planting the crop. There's something wrong when being efficient still isn't enough to make a buck.

Maybe you like on-sale 29-cent loaves of bread, but I can't help but think that while the consumer has an idea of what his or her bread will cost for a week, the farmer can't be sure of crop prices from the AM to the PM of a given day.

Perhaps they should dump their milk in the ditches, turn their crops into bales and kill the pigs, chickens and cattle. They might actually make a buck while sending a jolt into the industrial food supply chain. They used to do that sort of thing from time-to-time, but I haven't heard of it for at least 24 or so years now.

There's got to be some sort of middle ground. Right now things are unbalanced terribly in the favor of big companies. Perhaps value-added ag efforts is the ticket out of this whole morass. I guess only time will tell.



I cannot agree. I've laid out some of my thoughts in regards to why above. Show me an inefficient, lazy, money-grubbing farmer and I'll show you a beloved IRS bureaucrat .

Gatekeeper

Gatekeeper, I'm probably wasting my time...but let's try.

1. Farmers have no "right" to a dependable income. If they want the satisfaction that comes from owning a business, they have to deal with the risks. 50% of new businesses fail in the first 3 years. A farm is a small business. If farmers want more dependable paychecks, they should sell out and sharecrop or become ag workers for larger corps.

2. Americans have a right to try to get ag products as cheap as possible. Same with any other product. The consumer doesn't owe the farmer anything. It is a business transaction.

3. I really don't care if farmers got bad advice or if they have to change business models to succeed. They are the owners. It's their responsability to make decisions. In other industries, they wouldn't even have the advice to consider.

4. If they are truly efficient, they will stay in business. It is natural for the weaker farmers to go out of business. That is the way of the world. Same thing happens with restaurants all the time. Don't worry some farmers will always remain to meet the demand from the market.

5. If they collude to raise prices, they will face anti-trust action. Not everybody goes out of business. Concentrate on being better than the next guy, not on fixing prices.

6. You may have a point regarding large food processors. I would like more data on this. But even if this problem is fixed, it will do little for farmers. Consumers will reap the reward, not farmers.

One last point: I've known some very wealthy farmers. Nobody owes them anything...