Farm subsidies have stirred controversy in recent years. Some people see it a big blessing that can put the end to poverty and hunger, while others consider it as a curse that can put small farmers out of business.
All of these opinions can be confusing so, whether you’re a farmer who’d like to apply for this grant or a consumer who wants to stay informed, you need to do your research and learn more about farm subsidies. This way, you’ll know about their pros and cons and gain a deeper understanding of how they can affect the world. Here are a few pointers to help you get started:
List of Pros of Farm Subsidies
1. Helps stabilize the agricultural industry.
When farmers receive subsidies, they’ll have enough funds to replace their old machinery with modern and innovative farming equipment. They’ll also have the money to hire additional staff, build better barns and other facilities, and purchase high-quality fertilizers and other agricultural products. As a result, they’ll have better harvests and can produce world-class food in larger quantities.
2. Ensures food are available to everyone, especially the poor.
Because they have financial support from the government, farmers can plant and harvest more fruits, vegetables and other types of produce without ending up with large overheads. As a result, they can offer these products at relatively lower prices. This can be greatly beneficial especially to people who are unemployed and/or on a tight budget, since they can eat healthy food without having to spend a fortune.
3. Keeps price spikes at bay.
One of the best things about farm subsidies is that they allow local and small-scale farmers to compete with big agricultural companies. This helps in bringing diversity to the farming industry and ensures that large firms won’t have a monopoly on the sector. These, in turn, can prevent price spikes from taking place and ensure food prices stay reasonable and affordable to consumers.
List of Cons of Farm Subsidies
1. Can cost taxpayers a significant amount of money.
According to experts, farm subsidies in the U.S. cost taxpayers around $44 billion annually. This is a huge amount of cash, especially when you consider that the government has many other things to fund like education, healthcare and housing.
2. Can put many people out of business.
It’s impossible for the government to subsidize every single farmer in the country. As a result, there will always be several hundreds or even thousands of farmers who won’t receive financial support. This can be harmful since they won’t be able to compete with those who receive farm subsidies, and they can get bankrupt and be forced to stop farming in the long run.
3. Can limit farmers’ options.
When they receive subsidies, farmers usually have to stick to a certain set of guidelines. This might not seem so bad at first glance, but it can actually be detrimental since these rules can prevent farmers from improving their agricultural methods. It can also stop them from diversifying their land use and experimenting with different crops. As a result, the farming industry can stagnate over time.