Government-Provided Subsidies to US Farmers Essay

Government-Provided Subsidies to US FarmersTo be actively engaged in farming requires the significant contributions of land, capital, and labor or personal management. Hence farmer is a steward of farmland or a person who operates/cultivates the land[1]. Family in farming practices over the generations is the source of their income throughout their lives. Farm subsidies may be in form of grants, loans, cost-sharing, on-kind benefits such as commodities, and other professional services like research and technical assistance. American government is now on battle of legislation in extending another five years of subsidies for farmers. Indeed, American taxpayers and consumers will be forced to pay additional tax rate and higher prices in consumer goods and products. The present administration admittedly paralyzed agricultural prices. Thus the effect is prohibiting crop rotations and creates an effort for subsidies for U.

S. farmers The government still continues providing subsidies for the productions of agricultural products while restricting them to imports   .The budget summary of USDA[2] describes the fiscal year 2000 budget.

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USDA outlays the 13 percent of fund declination from $ 63.1 billion in 1993 to an estimated of $ 55.2 billion in 2000. Fund outlays the conservation of three agricultural aspects. First, is to protect the productive farmland, and preserve open space- assessment for a wide development in conservation of permanent farmlands. One of the main objectives of this assessment is to protect and provide great places for smart growth, and open space preventions. Because forest is the source of life it is important to address its protections and preservations for the future generations.   Secondly, protect the American agriculture from imported pests and diseases and enhance the marketability of American agricultural products abroad.

Pest and disease developed better resistance in foreign places causing great damage and loss to the agricultural products. They can adopt different environment conditions and worst, imported pest and diseases are easily to spread and becomes epidemic. Lastly, to expand economic and trade opportunities for agricultural producers through marketing services- identify alternative marketing strategies for small farmers.

In USDA 2000 budget summary one of the government missions is to support the expanded trade and economic opportunities for agricultural producers. Providing subsidies for agrarian reform through the export promotions, farm credits, and risks management and other related programs. Export promotion, food assistances, and foreign market development programs were the instrumental activities to achieve the primary goal in expansion programs of global market opportunities for U.S.

agricultural farmers/producers. Thus high tariff for agricultural encourage inefficient producers, to replace domestic producers from global market resulting into inefficient free flow of goods and distort trades. For over three-quarters of century, American’s farm policies still remained unchanged.

The U.S. government continues to subsidies primary agricultural products while restricting products imports. Their main reason of restriction importing products is to maintain the domestic high prices in consumer goods. Moreover, the congress is on writing new farm bill to replace the protectionist and subsidies. For the next decade, a farm bill with deep cuts into subsidies and barriers would save U.S.

taxpayers and consumers ten of billion of dollars. While there are highly potentials exports markets in the American economy for more than ten of billions. Revising the farm bill, there are six ways that would benefits the American’s citizen in eliminating farm subsidies.1. Lower Food Prices for American FamiliesOne reason to eliminate farm protectionist is to benefits American citizens.

Another is to protect the government from growing global competitions and raise the cost of food in relation to over all quality costs of living. Associated with federal dairy price supports and trade barriers, American citizen pays more than the world price in primary products. Based on the amount of processing embodied in a product, the costs are compounded by escalating tariffs. The market prices in commodity inputs, and processed foods would be probably cheaper if the cost is lower. Disproportionately the burden of these high products will be fall on poor households whereas farm protections act as regressive tax.  But on the other hand, if the farm subsidies and trade barriers will eliminates millions of American households will enjoy higher real income.2.

Lower Cost and Increased Exports for American CompaniesRevising farm reform, export producers and manufacturers from the rest of the world who uses agricultural inputs will significantly benefit. Higher cost in raw materials established higher cost on “downstream” users in supply chain. With the higher cost of raw materials means higher prices for consumers, reduced global competitiveness between local (America) exporters, lower sales or less investments, and fewer employment causes lower pay in affected industries. Higher cost means drive to the domestic producers to seek or export commodities for cheaper prices.

3. Budget Saving and Equity for U.S. TaxpayersAlso agricultural reform would reduce the cost of government. In 2003 congress phased out farm subsidies due to tax payers shelled out from expected direct subsidies of agricultural products. Subsidies level was set-off increase when crop prices fall. When commodity prices were high and the demand subsidies are low it end-up the price support program and replacing a declining fixed payment unrelated to market prices. The “emergency” supplemental bill had passed because of declining crop prices that caused total farm subsidies to rise.

  With the good perspective of taxpayers, it is the government should continue to subsidies farmers or companies, and other still remains profitable.4. More Environmentally Friendly Land UseModification of government into the agricultural policies impacts are on environmental damages. Trade barriers and subsidies increase the production of marginal lands that leads the overuse of pesticides and other chemical-based products.

The stimulation of overuse of these chemicals adds the runoffs to the polluted bodies of water nearby. Using fertilizers and pesticides, this leads the soil into eliminating forest or grass covers leaving the sol bare. As a result, soil exposed and bare for a period of time a great chance in soil erosion. Siltation[3] occurs to the nearby rivers or seas, because of erosion.

Land-use based for farmlands under control minimizing the forest land conversions into agricultural lands. By keeping marginal lands under cultivations and well managed of current farmlands, it caused slowing the trend of reforestation.5. Larger Markets for U.

S. Farmers and Economic Diversity for Rural AmericaComprehensive reform would mean an additional farm exports and imports.  Commodity inputs discouraged the diversifications in the productions of high-value-added products to the development food processing industry. They banned domestic consumptions while they encourage the use of lower-prices substitutes. On the others side the impacts of farm subsidies to land prices make expensive these unprotected crops.

6. A More Hospitable WorldFor many people who depends their survival to the cultivation or farming is both means of their source of nourishments and income, and acquiring wealth.Farm Safety NetU.

S. farm safety net is a set of programs and form of other assistances that provide land stewards the protections to their farmland against risks like devastation of natural disasters, loss income and limited access to credits  .This is the cylindrical approach and assistance of the government to the weaken condition and economic growth. Including farm bill revisions, the congress and citizens are in the battle of legislations in farm subsidies. Advantages and disadvantages against farm bill revisions are tackled on the early part. In addition, advantages and disadvantages are also emphasized to its relevance together with important comments into the legislations.  In United States agriculture is a source of employment.

But due several significant adjustments and farm consolidations agriculture is now declining to the response to its GDP[4] . Some concerns and comments are regarding equity, farm bill, government payments, and targeting benefits of farm family. [5] Regarding to the benefits of farm family subsidies there are some significant comments to the farm bill.  For others a quiet both advantages and disadvantages to the part of both local producers and manufacturers.

In this part, there are lists of comments in farm family benefits:  Some said the fund program should be specifically to the small and medium-sized of farm family only and for all beginning farmers the local governments should give tax incentives for them. Subsidies for large corporations must be cut instead provide supports for the rural developments, conservations, and loans for new beginning farmers. Aside from this, the local government must established programs that support the small and medium-sized farm that creates big impacts into future programs. They also focus on the programs that encourage young generations to enter agricultural career, and developed program that targets small and new established farmer to large farmer establishments. The government should nurture all small-scale farming and production/processing that would help local communities create new life and bring new faces to the future.  Providing farm subsidies should concentrate and restricted only to the small family farmers who produce local markets and practiced environmental sustainable method. In addition, supports subsidies for new farmers into organic agriculture which saves input cost and preserves environment.In relations of farm safety nets to the government payments, safety nets for crop productions are important to the farm family to produce profits and keep them into business.

Program payments are the source of life in the farm business. This makes small time and new beginner farmers in the agricultural productions as well as other farmer in food industry. The unrevised current farm bill has been proved of its successful to farm sectors to its stability in low prices.

  Regarding equity and farm bill should supports more diverse mixed crops in farming productions into strong and sustainable supply in the food industry. Specifically the government should support the low-input agriculture and address the specialty crop growers in providing subsidies for fruit and vegetables farmers. However fish and livestock risers must address and give attentions too, to the benefits and subsidies of the government.

Hence, they are part of downstream food producers. The government also gives equal and justifiable benefits to all of its sectors. Government programs should be more equitable across commodities and among regions of the country. Farm policy must be flexible by providing better supports in agricultural market expansion thru broader ranges of different activities in the area.

Payment Limits:Farm legislation had added various income limitations, and continued annual payments. Individual payments may include liability partnership or company or corporation, joint stock company, an association, limited stock company or partnership, an irrevocable trust, an estate, a charitable organization, and a State; political subdivision, or agency thereof . Stricter rules for payment limitations would harm agriculture which leads to decrease dollars of Federal support by the producers.Conclusions:Obviously farm bill creates impacts to U.

S. farmers in all aspects in the food productions industry. But local government must give attentions all factors affecting agricultural sectors for the future of American farmers. Farm policy must take into account in meeting global trade for the food industry.

Through subsidies new crops may be needed meeting new demand and expectations. If subsidies are made to cut farm subsidies, farmers must be protected[6] by government. And if subsidies are cut, young farmers as well as the large farmers, equipped dealers, banks, chemical companies and so forth are out of the business, the end of the story.

These large farmers and so other large companies are the real backbone of U.S. government.  And definitely young farmers are not going to take over if this happen[7].

Work Citations:USDA 200 budget Summary; Introduction;            http://www.usda.gov/agency/obpa/Budget-Summary/2000/text.html#introSix Reasons to Kill Farm Subsidies and Trade Barriers: A no-nonsense reform     strategy By Daniel Griswold, Stephen Slivinski, and Christopher Preble;   February 2006; http://www.reason.com/news/show/36207.htmlUnited Stated Department of Agriculture (USDA); Farm Bill Forum Comment   Summary & Background: Farm Safety Net; www.usda.

gov/documents/FARM_SAFETY_NET.pdfUnited Stated Department of Agriculture (USDA); Agriculture and Trade Reports; U.S.-          E.

U. Food and Agriculture Comparisons; January 2004;http://www.ers.

usda.gov/publications/WRS0404/WRS0404.pdfFAS Online; World Trade Organization; Fact File; http://www.fas.usda.

gov/info/agexporter/1999/articles/world.htmlDictionary.Com; Search Reference; 2006; http://dictionary.reference.com/browse/siltationUSDA; Farm Bill 2007 Official Comments; August 19, 2005, 11: 39 AM; “[email protected]%inter2” [email protected];http://www.

usda.gov/FBFComments/Files/5002997-1.pdfUSDA; Farm Bill 2007 Official Comments; June 30, 2007; 08:21 AM; [email protected]; http://www.

usda.gov/FBFComments/Files/5002846-1.pdf[1] Dictionay.Com; Farmer[2] United State Department of Agriculture[3] Siltations the soil erosion in watershed or other body part of the water. Fine sands or soil carried by running water and deposited as sediments.[4] Gross deposit products[5] U.S.

-E.U. Food and Agriculture Comparisons[6] Farm Bill 2007 Official Comments; 08/10.2005 11:39 AM[7] Farm Bill 2007 Official Comments; 06/30/2005, 08:21 AM

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