Relay-Version: version B 2.10 5/3/83; site utzoo.UUCP Path: utzoo!linus!wivax!decvax!harpo!eagle!mhuxt!mhuxi!mhuxa!houxm!hocda!spanky!burl!we13!ihnp4!ixn5c!inuxc!pur-ee!iuvax!isrnix!tim From: tim@isrnix.UUCP Newsgroups: net.politics Subject: Govt and Agriculture Message-ID: <253@isrnix.UUCP> Date: Tue, 28-Jun-83 12:33:18 EDT Article-I.D.: isrnix.253 Posted: Tue Jun 28 12:33:18 1983 Date-Received: Wed, 29-Jun-83 10:36:17 EDT Lines: 43 It seems that our "expert" on Capitalism hasn't studied much economics if Tom Craver doesn't understand the reason for farm subsidies. Have you ever heard of something called the "cobweb function", Tom? It is an economic effect which occurs when you have a combination of an inelastic demand (like the demand for food-you absolutely NEED some minimun but you also can't eat above some maximum) for a commodity and a periodically inelastic supply-once fields are planted each year that's pretty much it-the farmer can't go back in the middle of the season and either plant more crops (it will be too late) or it would be kindof irrational to take out crops already planted. Hence the cobweb function results in which farmers responding to high prices will then vastly overplant which results in prices where they really can't afford to live which leads to farms going out of business which leads to less production, incredibly higher prices and so forth-the thing is with the cobweb function is that instead of following the usual path towards equilibrium between supply and demand (which is your supposedly wonderful virtue of Capitalism when it works as it's supposed to) you get a situation of wild fluctuations in which supply and demand grow increasingly divergent-there are periods of glut and periods of famine. THUS under our terrible "socialistic" govt since the New Deal in the 30's we have had the system of farm subsidies to keep prices stable -if weather conditions etc result in a very big crop the gov't will buy up the excess to keep prices higher so farmers stay in business and continue to produce the incredible cornucopia of agricultural products we enjoy in this country. We have one of the most, if not the most , successful agricultaral systems in the world -prices for food have not gone up all that much since the farm subsidy programs were instituted and we enjoy a plentiful supply. Twas not always thus--but this is the blessing of the terrible "government intervention"! Besides the subsidy programs the gov't has supplied all sorts of other help to agriculture-farm extension agents,the many agricultural colleges founded under the Merril Act which have done much of the research which has resulted in our very efficient agricultural production, and other aids. And we have one of the most productive agricultural systems in the world-- hmmmm wonder how that could have happened with all this involvement of big bad government? Government in a democracy is merely the people getting together to help themselves. I think that idea is WONDERFUL!!!! Tim Sevener decvax!pur-ee!iuvax!isrnix!tim