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Farm Subsidies and the Agricultural Marketing Agreement Act of 1937

Buy custom Farm Subsidies and the Agricultural Marketing Agreement Act of 1937 essay

Buy custom Farm Subsidies and the Agricultural Marketing Agreement Act of 1937 essay

The enactment of the Farm Subsidies and the Agricultural Marketing Agreement Act of 1937 sought to control the price of corn, cotton, and wheat and to ensure that there was constant supply of these crops, especially during the low seasons. The bill was effective in ensuring constant supply and stable price of corn, cotton and wheat. In addition, the enactment of the bill saw a rise in the amount of supplies to the public and the areas in the country where the supplies were low. Since its enactment, the bill has helped in the reduction and evasion of price tags that would have otherwise been a great loss to the suppliers of farm products in the United States. According to Ortmann and King (2007), the enactment and functioning of the bill provides an opportunity for the federal and state governments to ensure that the public has a continuous flow of food supply at the convenient time and prices. Therefore, this research paper focuses on the reasons why the federal and state governments should not continue to support the Farm Subsidies and the Agricultural Marketing Agreement Act.

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Sumner (2003) reflected on the influence of the bill in combating the “dairy cliff”, whereby a number of dairy farmers were saved from the discontinuation of the federal subsidies. However, even after the incident, the dairy farmers had difficulties balancing the sales and the operation of their business. On the other hand, the bill is praised since it made it possible for soldiers in the Vietnam War to have combat uniforms. Similarly, it provided for a system of solving the problem but never focused on the long-term issues that the farmers were facing. Gonzalez (2002) stated that the enactment of the bill was aimed at resolving the short-term problems facing farmers without the consideration of the long-term ones. Economic impact of te bill consisted in the fact that it reduced the budget which would otherwise be invested into other areas such as the health or security departments.  

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The efficiency of the bill for the present generation is lower as most of the products consumed in the homes and the raw materials for businesses are at a low demand.  Ortmann and King (2007) asserted that the bill has failed to guarantee food security, which its initial implementation sought to accomplish. The ever-increasing price of goods in the markets affects the production of the same goods by prospective farmers. Consequently, the inefficiency of the bill to provide customers and producers a convenient price value that will support their investments reflects on the government losses in terms of taxes. The reduction in the number of consumers of the fresh farm produce reflects the cut in the total accruement of taxes for the state and the federal government. Likewise, a number of investors look for alternative ventures of business where they would invest their money.  

The subsidies are in a great part offered to the big industries, which dominate the agricultural markets. These organizations have the ability of manufacturing and selling their products to big markets in systems where they can accrue profits. The farmers, on the other hand, lose their standings in the agricultural market and their access to these subsidies. As a result, individual farmers manufacture their products for the subsistence consumption and not commercial use. Insufficient production of the quality farm goods gives way for the production of genetically modified crops, which might affect the well-being of the public. The effect, therefore, extends to the medical sphere; the expenditure on medication facilities increases, which affects the federal budget. The free market, oon the other hand, has been a great disappointment to the individual farmers leaving them unable to sell their produce at prices that instigate healthy competition. Therefore, the large producers and firms gain profits at the expense of the small farmers. However, Aksoy and Beghin (2004) concluded that a number of factors such as the weather also influence the continued poor market status of the farm products.

The bill receives considerable support from the Congress with the SNAP being among the major items of consideration. However, Aksoy and Beghin (2004) commented that SNAP is not related to the farm products and should not be included in the agricultural bill and budgeting. Over the past years, the bill has been subdivided into the major components with SNAP considered as one of the components while some other vital parts of the agricultural bill excluded or given less priority.

Over the years, the Farm Subsidies and the Agricultural Marketing Agreement Act of 1937 has been on the forefront to provide the farmers and the suppliers of the agricultural products a convenient system of producing and selling their goods. However, with time, a number of amendments have been made to the bill leaving a substantial number of the original objectives unattended. As a result, countless farmers have lost their interest in agricultural investment and opted for other business ventures as a way of living. On the other hand, big companies have had the advantage of monopolizing the markets paving way for the development and sale of genetically modified products, which discourages the production and consumption of naturally planted foods. Therefore, the bill should be given less priority as it does not serve to provide the public with continuous food supply, affordable prices, and securing the market ventures for the farmers.

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