#corn subsidy

[newstfionline]

Penny for your corn? Stingy trade-war aid irks U.S. farmers

P.J. Huffstutter, Mark Weinraub, Reuters, Nov. 28, 2018

CHICAGO (Reuters)--Iowa corn farmer Bob Hemesath jokes that the government check he expects as compensation for his trade-war losses will soon allow him to splurge on upscale coffee in town instead of his usual burnt gas-station brew.

Rob Sharkey, an Illinois farmer, hopes his corn trade aid check will be big enough for that margarita machine he and his wife have been eyeing--but they doubt they’ll be any left over for the booze.

Federal economists have calculated that the nation’s losses in corn--its largest crop by harvest and export volume--amount to just a penny per bushel, a pittance farmers call absurd. That’s in stark contrast to the substantial $1.65 per bushel the government will pay for lost sales of soybeans, the crop hardest hit by retaliatory Chinese tariffs in a trade war launched by U.S. President Donald Trump.

Both subsidies only cover half the bushels harvested this fall, though the government could soon decide to apply more aid money to this season.

“You have to wonder why Washington even bothered” with the corn subsidy, said Sharkey, 43, a fifth-generation farmer. “The soybean payment? That’s real money that can help us.”

Even Sonny Perdue, Trump’s agriculture chief, fails to understand the pennies in trade aid. The U.S. Department of Agriculture secretary--a former farmer himself--recently told corn growers gathered in Champaign, Illinois, that the measly offering left him baffled and asking his agency’s economists how they figured the number.

“We have got $1.65 on beans and a penny on corn? That doesn’t make any sense,’” he said. “If I were picking numbers, I’d have picked a different one.”

But Perdue said the department was obligated to stick with the economists’ algorithm because it mirrors what the U.S. would present to the World Trade Organization when filing an unfair-trade grievance.

The USDA in August outlined how it would spend the first $6.1 billion of an authorized $12 billion aid package for farmers caught up in the trade war, including cash payments for farmers of grains, oilseeds, cotton, dairy and hogs.

The National Corn Growers Association has urged Perdue to change how the government calculates the economic bite of lost exports in its next tranche of trade aid, expected in December.

Some farmers cracked that they wouldn’t stoop to pick up pennies off the ground, much less request them through bureaucratic forms.

For Indiana farmer Randy Kron, the corn trade aid means about $900, enough to pay for a few parts for his planter, or some seeds for next spring’s planting. His son, who helps them run their 2,200 acre crop farm, thinks the amount isn’t worth the effort.

“He’s tired of hearing his Dad preach to him about how bad it can get,” said Kron, 57.

Kron said he will apply for the federal assistance nonetheless.

“I started farming in 1983,” he said. “Back then, every penny mattered. We paid attention to pennies.”

[classicalliberalbias-blog]

Mexican Coke

My father has always enjoyed his Mexican coke. To be specific, he enjoys Coca-Cola imported from Mexico, because Mexican manufacturers use real cane sugar as opposed to high-fructose corn syrup. Until recently, I had never tasted a coke with real cane sugar, because it’s difficult to find and expensive.

This changed after I took a five mile jog from my Jersey City apartment to Union City. Once my knees could no longer take the weight of my less than slender frame I surrendered. Unfortunately, I had picked a particularly awful time to break down and could find no place to find water in sight. My mouth was dry, the sun relentlessly beat upon my brow, and my knees were close to buckling (my description sounds exaggerated, but there’s nothing I hate more than dry mouth).

As I combed nearby shops for water, I came across a store that sold its coke in tall, glass, bottles. I immediately recognized them as imported, Mexican, Coca-Cola. I quickly snatched two from the store’s fridge and paid.

My first swig neglected the Cola’s actual taste. I could care less what I was drinking, so long as it quenched my thirst. My second and third gulps were similarly neglectful of the beverages substance. It was on the fourth gulp that I realized the sugary goodness that is Mexican Coca-Cola. My father may not have the best taste in clothing or dining (He buys his shirts and food from Wall-Mart), but when it comes to his preference of Mexican Coke over American coke, his analysis was spot on.

Why American Coca-Cola is produced with corn syrup as opposed to sugar is no mystery. The federal government subsidizes the corn industry to the tune of 7 billion dollars annually. Through these subsidies agribusiness, I mean farmers, are provided an incentive to produce as much corn as possible. As a result, farmers produce an excess supply of corn and drive down the price of corn-based products. Couple these subsidies with government quotas and tariffs on corn and sugar products, and corn syrup becomes a more economically viable alternative.

In part, these subsidies do harm at home and abroad. For example, third world farmers that produce corn ethanol and sugar products are unable to compete with large, American, corn producing, agribusiness. How can we expect the third world to compete, and lift itself from poverty when our government pays agribusiness to grow competing products, and places tariffs on the  corn products the third world does import? At home, we suffer because these subsidies come from our pockets.

Fortunately, it seems like politicians and commentators on the left and right not from Iowa (the largest corn producing state in the country), have placed the corn lobby on notice. Sens. Dianne Feinstein (D-Calif.) and Tom Coburn (R-Okla.) have introduced the Ethanol Subsidy and Tariff Repeal Act to eliminate subsidies and tax breaks provided to the corn lobby. The corn lobby however, is determined to strike back and has launched a series of corny commercials (terrible but necessary pun) in defense of corn syrup and by extension their subsidies. Regardless of the outcome of any legislation, like my father, I love Mexican Coke.