More Bailouts Coming?
More bailouts coming? Don’t worry. It’s peanuts! Retweet
I sent the following letter to Congress, using the End Subsidies campaign. The hardwired message there is…
End all subsidies.
Please join me. It’s simple. You can copy and paste the letter below or write one of your own.
Peanut farmers are producing way more peanuts than anyone wants. Why? They know the taxpayers will bail them out.
I OBJECT to being stuck with the bill!
$2 billion over three years – the estimate for this particular bailout – is hardly peanuts.
America’s peanut crop is at an all-time high. Farmers are growing more than they can sell at market. Prices are plummeting. Surpluses are piling up. Yet those same farmers are making plans to plant even more! http://tinyurl.com/gpqk87v
This only makes sense in light of the perverse incentives of agricultural subsidies and price supports:
* The USDA pays peanut farmers most of the difference between a “reference price” of $535 per ton and market prices, which are now below $400 per ton.
* Government loan guarantees mean once prices fall below levels used to value their crops as collateral, farmers can default on the loans and hand over the peanuts to the USDA rather than sell them to make the payments.
Subsidies line the pockets of a handful of growers, mostly the bigger and more politically connected ones, at the expense of small farmers and the rest of us.
Farmers, like all businesses, should operate within the constraints of the voluntary market. They should NOT get a free ride on the backs of the taxpayers.
End ALL agricultural bailouts, subsidies, and loan guarantees now. End subsidies and bailouts for all businesses.
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