trc@houti.UUCP (07/01/83)
Response to Tim Sevener: First, what makes you think that prices dont vary widely anymore? As a farmer's son, I can tell you that they do. (Whenever they arent simply heading lower!) The cobweb function only allows prices to vary within limits. Those limits are established on the high end by the least amount farmers will plant and on the low end by the biggest harvest possible if all farmed acres are planted. If prices are varying too greatly. it is because there are too many farmed acres for the demand. If there were only a minimum of acres in production, with some margin for crop failure, and the rest were not farmed, prices would not vary much. Farmers would be planting all they could, and nearly all they could produce would be purchased. Supposing, (as you do) that wild variations are bad, how could those variations be minimized? By letting market forces drive the least productive farmers out of business, to the level at which farm land is being used most productively. This is exactly what would happen in those years in which farmers overplant. Unless, that is, there are subsidies in place to keep the farmer in business at the expense of everyone else. These subsidies would encourage the less productive to stay in business. This, in turn, keeps more acres in shape to produce those wild variations in prices. This is yet another example of an action motivated by altuistism continuing the problem it was to solve, at a higher cost. The market, left to itself, would normally keep prices pretty stable, with production on farmed land maximized. So, while the cobweb function may be real, it is a short term effect, which will naturally correct itself. I may not be an expert on economics, but I do know the basic law of supply and demand. Have you forgotten them, or simply decided that some people (farmers) should be made exempt? My father, and other farmers like him, dont want your favors - his term for them is "those damn subsidies". He knows that he has to pay for them, that he doesnt want them, and that he could do better if farmers were left alone. And if he were wrong, and were put out of business, he would not lack for work - there are still jobs around for combined businessman/ machinist/inventor/carpenter/welder/etc/etc/etc's. So save your pity for someone else. As to how the strongest agriculture system in the world could grow up under Big Government, the answer is simple - it didnt. It built its strength before Roosevelt was out of his diapers, and continues it today on the traditions of mental fortitude and common sense among its farmers. Tom Craver houti!trc