Confused? We’re Not!
Posted on October 31, 2014
All right, listen up! We’ve got a lot to sort out here and little time to do it.
First off, sure, you’re confused. Hey, your neighbor is confused. Your uncle’s confused. Your dog’s confused. Fact is, everyone’s confused. But we’ve been confused worse than this before and we all managed to somehow find our way to less confusion by working together. So let’s get started.
OK, the grain markets.
Yes, they’re a train wreck but if you grow 14 billion bushels of this, four billion bushels of that, and then another coupla’ billion of the other thing your future isn’t gonna look as good as Beyoncé’s… ah… well, Beyoncé.
It may be shakin’ like Beyoncé’s… ah… well, Beyoncé but it’s never gonna’ look as good.
In the past we had a name for times like these:. We called them the 80s. And, well, OK, the 90s and the 2000s.
‘Course, back then most everyone in Congress was ready to help with things like the Conservation Reserve Program, the Farmer Owned Reserve, deficiency payments, even direct payments. In case you haven’t heard, though, that’s not the case now.
But we do have—what’s it called again?—yeah, we do have something called the Agricultural Risk Coverage-County Program and something else called the, ah, ah, yeah, Price Loss Coverage Program.
I know, I know. ARC-dash-CP and PLC-dash-Nothing are more confusing than CRP, DP and LDP and no one can really explain what they’ll do this year or next.
Still, there are some crack ag economists working right now to unlock the secrets to these programs so that by next spring—when you get your one crack to get into the right program for the next four or five years—you might get it right.
We can all hope, anyway.
And, yes, some folks are already saying that Congress will have to step in and fix the current Farm Bill’s shortcomings. ‘Course most folks think the biggest shortcoming is either Congress or the money these programs will eat up if grain prices remain in the tank.
Well, here’s the good part on that part: For years now most everyone in Congress has heard farmers and ranchers say there’s “too much government,” so if Congress goes Republican—a two-in-three chance, if you believe what you read in the papers—then there’s not gonna be “too much government” a year from now with all the “smaller government” types in charge of big government.
How’s that the good part?
Well, simple; you won’t have to worry about more farm program choices next year. What you see in the Farm Bill now is what you’ll likely see in the Farm Bill then because to hear today’s Congressional candidates tell it, a Republican-led Congress will be not be writing bigger checks to anyone for anything anytime soon.
And anyone is everyone—you, me and all those small-government loving farmers and ranchers.
Unless, of course, Congress can find the money somewhere else to cover larger farm program checks they say they won’t write. Like, say, Food Stamps, or the Supplemental Nutrition Assistance Program.
SNAP has billions and billions, as we all learned during the last Farm Bill scrap and, by pure coincidence, the 2014 budget proposal from House Republicans did urge Congress slice $125 billion from SNAP over the coming 10 years.
Interestingly, $125 billion is about what the short-lived 1996 Farm Bill—everyone called it Freedom to Farm, remember?—cost taxpayers when a GOP majority last wrote U.S. farm policy.
I’m not recommending. I’m just sayin’.
Then again, taking money from government food assistance programs to pay for government farm commodity programs might not be the best optics, as they say on Capitol Hill. But it may have to be done to make sure we feed the world.
And that’s why we’re here, right, to feed the world?
OK, any questions? If not, let’s move on to figuring out Wall Street.