The Problems with Farm Subsidies :: Economy

The Problems with Farm Subsidies Subsidies are payments, economic concessions, or privileges given bythe government to favor businesses or consumers. In the 1930s, subsidieswere designed to favor agriculture. John Steinbeck expressed his dislike ofthe farm subsidy system of the United States in his book, The Grapes ofWrath. In that book, the government gave money to farms so that they wouldgrow and sell a certain amount of crops. As a result, Steinbeck argued,many people starved unnecessarily. Steinbeck examined farm subsidies from apersonal level, showing how they hurt the common man. Subsidies have avariety of other problems, both on the micro and macro level, that shouldnot be ignored. condescension their benefits, farm subsidies are an inefficientand dysfunctional part of our economic system. The problems of the American farmer arose in the 1920s, and variousmethods were introduced to help solve them. The United States stilldisagrees on how to solve the continuing proble m of agriculturaloverproduction. In 1916, the number of people living on farms was at itsmaximum at 32,530,000. Most of these farms were relatively wasted (Reische51). Technological advances in the 1920s brought a variety of effects. Theuse of machinery increased productivity while reducing the need for as manyfarm laborers. The industrial lucubrate of the 1920s drew many workers off thefarm and into the cities. Machinery, while increasing productivity,was very expensive. Demand for fare, though, stayed relativelyconstant (Long 85). As a result of this, food prices went down. The smallfarmer was no longer able to compete, lacking the capital to buy productivemachinery. Small farms lost their practicality, and many farmers wereforced to consolidate to compete. Fewer, bigger farms resulted (Reische 51).During the Depression, unemployment grew while income shrank. An extendeddrought had aggravated the farm problem during the 1930s (Reische 52).Congress, to counter this, passed price support legislation to assure aprofit to the farmers. The tarnish Conservation and Domestic Allotment Act of1936 allowed the government to limit acreage use for certain soil-depletingcrops. The Agricultural Marketing Agreement Act of 1937 allowed thegovernment to point the minimum price and amount sold of a good at the market.The Agricultural Adjustment Act of 1938, farmers were given price supportsfor not growing crops. These allowed farmers to mechanize, which was demand because of the scarcity of farm labor during World War II(Reische 52). During World War II, demand for food increased, and farmersenjoyed a period of general prosperity (Reische 52).