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Politics : Formerly About Advanced Micro Devices

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To: tejek who wrote (183580)	3/3/2004 3:30:38 PM
From: TimF	Read Replies (1) of 1574096

1 - They cost billions of dollars. So does military hardware......billions upon billions. Military hardware serves a useful function. Farm subsidies are a net negative even if you ignore the cost in the budget. Also the fact that military hardware costs billions doesn't support spending billions on anything else. Each thing would have to be evaluated separately and the fact that farm subsidies cost billions is a argument against them. To justify the spending they would have to have a benefit that exceeds the cost. 2 - Many of them are structured to increase food prices which hurts consumers esp. the poor. No, they're not.......they are set up to guarantee the farmers a subsistence standard of living. Trust me, no farmer is getting rich off of Uncle Sam. Most farm subsidies go to large companies who do indeed make a lot of money off Uncle Sam. Also you point wasn't a reply to my point. Even if no one did get a hefty profit from the subsidy it would still be true that many of them are structured so as to increase prices which does indeed hurt the poor. 3 - Like all subsidies they create a situation where resources are less efficiently used. How is that? Resources are not allocated according to market demand but rather according to government decisions. Subsidies aren't usually as bad as outright bureaucratic command and control, but they still distort the efficient allocation of resources. More resources go to the subsidized goods and the supply will be artificially increased. Those resources could have been used for other needs. The government then usually buys the surplus (spending more money) and often limits imports (artificially increasing the price for US consumers and also hurting poor third world farmers. Have you ever taken any economics courses. The ways that subsidies reduce efficiency are pretty basic economic concepts. Econ 101 level ideas. 4 - Third world countries are impoverished by food trade barriers and subsidies. Third world countries are impoverished for lots of reasons and can't afford to buy foor or anything else for that matter on the open market. Third world countries are directly hurt by being unable to export a number of agricultural goods to the US and/or Europe. They are also hurt when American or European subsidies allow American or European agribusiness to undercut the third world's farmers prices on the world market. The cost to third world economies of these subsidies and trade barriers is greater then the worth of all the aid they receive from richer countries. But the subsidies also cost the rich countries because they reduce trade and they increase government spending, and because they increase prices for consumers. Tim

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