Rep. De La Garza on supply and demand, subsidies and price supports

The congressman does not believe that the law of supply and demand applies to agricultural products. He does not think that reducing production increases the price of an agricultural commodity. He does not think that an increase in production - supply( other things being equal) will reduce the price of a commodity. He does not believe that price supports increase production. His thinking explains federal agricultural policy.

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[jasonbudd06]

If supply of a crop does not affect price, then the Supreme Court's application of the Commerce Clause to allow Congress to control supply of crops is likewise incorrect. The Congressman is arguing, unwittingly, that the program is unconstitutional.

[janhelfeld]

@jasonbudd06 interesting point.

[benjamindees]

Jan, I enjoy 99% of your interviews but this one is extremely weak. You spent ten minutes trying to understand why the gov't subsidizes crop rotation and planting cover crops (green manure). The reasons are:

1) Green fertilizers reduce chemical fertilizer usage, oil imports, the trade deficit, and the costly wars that go along with those.

2) Crop rotation reduces pest infestations and soil depletion and results in a more secure food supply.

Surely you aren't against sustainable agriculture?

[janhelfeld]

I am against forcing citizens to pay farmers to farm i.e, against farm subsidies. Also, I believe that if you reduce supply prices go up. Do you agree with the law of supply and demand or do you agree with the Congressman?

[benjamindees]

Jan, I agree with the law of supply and demand. I am also against farm subsidies, in theory. But I believe a free market produces certain negative externalities, and that the purpose of government is to regulate those to the effect that they infringe on the rights of third parties.

This is not really an issue of subsidies, rather of policing and governing population growth. Instead of looking at the effects of this program on food supply, look at it's effects on food demand. cont...

[janhelfeld]

you are a good candidate for a radio interview.

[tesla921]

I would like to get paid for not buying a farm and therefore not growing the specific crops that you get paid not to grow.

Hey, there's a lot of money to be "earned" here.

[tesla921]

Another complete boob elected by Boobus Americanus.

[powellbrandon90]

interesting video

[rebby11]

"This is very complex"

Boy I couldn't agree more. You've tied yourself in so many intellectual knots I don't know how to make sense of what your saying. What district did you come from? Mars?

[benjamindees]

@SSgtParmer Yes, externalities should be internalized. But the externalities are not created by the farmers.

[TreachMarkets]

"This isn't a supply and demand operation." I think we've stumbled upon a problem...

[rumco]

@taradfong and I was too outraged by his statist position ! :)

[taradfong]

I agree!  I was being sarcastic!

[rumco]

@taradfong Boohoo, complicated my arse. They don't grow plants, they get paid with money stolen from others (consumers). Just liked during 30's under Hoover.

[taradfong]

It's just very complicated. Trust him.

Amazing the lengths people will go so that they don't have to even entertain a view they oppose, logic be damned. He would deny that 1 + 1 = 2 if it meant casting the slightest aspersion on subsidies.