March 11, 2020 • 60 mins
Make no mistake -- being a farmer is hard work. Farming outfits often have to carry a huge amount of risk from one season to the next, and any number of things may ruin their prospects, from unexpected weather, market volatility and so on. To mitigate these dangers, world governments often provide funding, or subsidies, to agribusiness in order to lower risk and increase chances of farmers staying in business. In the US, these subsidies are a multi-billion dollar industry... but where does all that money actually go?
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Episode Transcript
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Speaker 1 (00:00):
From UFOs to psychic powers and government conspiracies. History is
riddled with unexplained events. You can turn back now or
learn the stuff they don't want you to know. A
production of I Heart Brading. Welcome back to the show.
(00:25):
My name is Matt, my name is Nol. They called
me Ben, and you're joined as always with our super
producer Paul Mission Control decond. Most importantly, you are you.
You are here, and that makes this stuff they don't
want you to know. This is going to be an
interesting episode today. I want to go ahead and congratulate
everyone who did not judge today's episode by the title alone.
(00:50):
I think the title of this is actually the surprisingly
unboring story of farm subsidies. Yeah, it could be interpreted
as a snooze fest, but you know, you know us,
you know this show. There's not a snooze fest amongst.
It remas me of that part in Wayne's World where
he's doing the green screen and he's like, hey, I'm
in Delaware because Delaware seems like the most boring place,
(01:13):
but as it turns out, it's incredible tax haven. Yeah,
that's true, secret excitement all around. That's why all of
your credit cards and many of your banks are based
for some reason in Delaware, Dover, I believe because the
laws are different. Now, this topic was not something that
(01:33):
the three or four of us came up with on
our own, Like many of the best suggestions for this show,
this came to us from a listener email from the
Raven with a Y. Now, the Raven, maybe I can
remove the definitive there and just call you Raven. Uh.
(01:54):
You sent us this fantastic email. It's it's a little
bit long, so we're just gonna read some excerpts, but
we're gonna set it up. And Uh, I gotta say,
my friend, I like the way you right, Oh for sure,
especially adding adding in your own sound effects. Says greetings, gentlemen,
I bring you information for a possible episode. The topic
(02:17):
may seem boring on the surface, but I feel as
though something is a miss I present to you. Farm
subsidies submitted for your approval. Don't done. Yes, my friends,
farm subsidies. I don't know much about it, but I
noticed odd things with a specific company, so there may
be other things out there. Here are the facts. First off,
(02:43):
there's no such thing as a dumb question, So what
the hell is a farm subsidies. Farm subsidies are essentially
cash given from a government. The US does this as
well as many other countries to support agribusinesses. These can
be absolute life savers because being a farmer is difficult.
(03:05):
It's a dicey proposition. Farmers can use the money provided
by the government to ride out risk and the potentially
enormous losses involved in this unpredictable industry. Like you can't
predict the weather all the time, you can't predict how
you're going to interact with commodities brokers. You can't predict
demand as accurately as people would want. Farm subsidies are
(03:31):
a thing that is pretty close to mission controls heart. Uh.
And we did check to make sure it's okay that
we said that. But you know us, we always we
always like to lean on people with personal experience. We
like primary sources. So if you hear us pausing when
we say something and then quickly correcting ourselves, it maybe
(03:53):
because Paul gave us the glare of death through the
studio window. And this is a little known here, This
has never happened before. Paul's Mike Mission controls. Mike is
alive right now, So like if he wanted to, he
could say a word, but he's not going to. I'm
(04:13):
feeling a sense of foreboding. Said that, he's like this
cartoon rabbits. So it's like, if you don't have something
nice to say, don't say nothing at all. So Paul
is going to chime in if he has something nice,
A k A helpful correct. Yes, farm subsidies, though you
may have heard them tossed around in in a lot
(04:36):
of headlines recently, you're gonna read language like farm bailout. Yes,
that's the one that I've seen the most. So these
things have a long, long history here in the US.
The Homestead Act in eighteen sixty two granted land in
the West to anyone willing to farm. It said, just
show up, make food, and you can have the land
(04:59):
it grows on. And then in the same year there
was something called the Moral Act m O R R
I L L that was past This funded colleges of agriculture.
So Uncle Sam always knew that food was important, and
the government intervened multiple times throughout this country's history to
(05:19):
assist assist in the creation of farming interest like the
Federal Farm Loan Act that would give you pretty generous
loans if and only if you're a farmer or starting
a farm. Yeah, it's one of those things is humans. Um,
we need water, we need to be able to breathe,
we need shelter, we need love, and we need food.
(05:41):
Food is very important, and food production becomes very very important,
especially when you're in a time of crisis, like of war.
Let's say that's why this, uh, the subsidizing were the
assistance with farming is so essential because each of us
has to eat. So let's them to nineteen twenty nine.
(06:02):
Let's do it nineteen nine, in which the Agricultural Marketing
Act of ninety nine it established the Federal Farm Board,
which sought to keep crop prices manageable, keep them from
absolutely bottoming out. So farmers were, um. The hope was
(06:23):
that they would limit crops, but that didn't really take um,
and then the bureau bought and stockpiled these crops in
order to you know, kind of manipulate supply and demand
by limiting supply. And then um, it kind of switched
gears and transformed into the Farm Credit Administration in nineteen
(06:48):
thirty three, and then in nineteen thirty three, Congress signs
what's called the Agricultural Adjustment Actor A A A. Again,
I know we can get the weeds here, but this stuff,
this will be important later when we get to the
weird part of this. We'll all be glad that we
know this now. So this Triple A Agricultural Adjustment Act did,
(07:09):
uh did something very similar to what you were talking about.
It reduced crop output. It paid farmers to not do
their job. And you think, why on earth would you
do that? Do we need more food? Isn't this whole
thing about all of us needing to eat? Right? But
you also want people to make a living because if
(07:30):
everybody is growing a ton of this an example, Paul use,
if everybody has a bumper crop and grows a great
amount of wheat, then how are they going to be
able to sell it? Because the price will plummet And
then you're you, as a farmer, are being punished for
doing well. So, yeah, you're right. It really is about
(07:52):
supply and demand. And this Triple A this had some
extreme results. Crop prices in general doubled within just four years,
and the Supreme Court overturned the Triple A because it
was it was putting taxes on people who processed crops,
(08:18):
but it was giving money to farmers, and then they
tried to fix it again in ninety eight, and then
when a lot of farms were being foreclosed upon, the
Emergency Farm Mortgage Act was a government intervention that gave
farms the life saving loans they needed to continue their businesses.
(08:38):
So in the same year, in eight, we've got the
New Agricultural Adjustment Act creatively named because it was like
the new one UM, and that kind of took care
of some of the issues that were presented by the
nineteen thirty three version UM. And this price support system
as it was referred to, kind of uh petered out
(08:58):
in the nineteen nine these Well that's exactly yeah, but
but that's sort of when it run its course, and
the federal government was able to pretty astoundingly guarantee farmers
a high enough price to stay in business, to actually
make a profit for their families. How is this accomplished? Well, Uh,
it paid farmers to make sure again manipulating supply and demand,
(09:23):
make sure the supply did not exceed the demand. Then
the government subsidized farmers to keep crop lands idle so
fallow fields, essentially in order to prevent um. Basically waste
crop waste over production also actually bought out any excess
(09:44):
crops UM it then either stockpiled them or gave them
away to lower income families throughout the world. So it
had kind of a philanthropic wing to it as well.
And then in for arm subsidies. UM, it's kind of
the year for peak farm subsidies when it reached a
record twenty two billion dollars. Can I bring something up
(10:10):
here that we that happened in nineteen nine. I think
it's something that Paul was talking to us about earlier
off Mike called the Conservation Reserve Program. UM. Can we
talk about that now, Yeah, exactly, because we we kind
of just mentioned it there. UM. It's called the Conservation
Reserve Program or CRP, and I'm reading this from the
(10:31):
f s A dot U, s d A dot Gov. Um,
this is a program that UH, in exchange for a
yearly rental payment, farmers enrolled in this program agree to
remove environmentally sensitive land from agricultural production and plant species
that will improve the environmental health and quality. So it's
(10:52):
these it's these contracts and not a contract. I guess
it's you sign up for this program, then portions of
your farmland are just kind of let to go wild basically,
which allows the soil to regenerate. It's probably better for
local wildlife, you know, especially herbivores amongst the fauna. Uh.
Then we can see the logic here, even though it
(11:13):
sounds maybe a little Joseph Heller esk at first, like
what you're paying me not to do something? But it
fields many people argue that it is necessary. Of course,
not every anybody who has ever tried to buy like
a dragon for or a pomegranate quickly learns or avocados
(11:34):
for good, to say, quickly learns that not all crops
are subsidized here in the US. Out of all of
the crops that farmers grow, there are only five that
are subsidized, corn, soybeans, wheat, cotton, and rice. And that's
because the grains here in this list are the big,
(11:54):
big players. If you just took the edible stuff from
what we named rice, wheat, beans, corned and you added
up all you added up all of those crops, and
then you looked at how much food all the people
on earth collectively, eight eighty percent of it would be rice, wheat, soybeans,
and corn, think about food processing and how many products
(12:18):
exist in grocery stores across the world that are based
in one of those or if not multiple, well not
even not only stuff in grocery stores. Think about ethanol
that comes from corn, and I don't want to jump
the gun. I'm sure we're gonna get into this a
little more later, but I believe some of those subsidies
went away under the Trump administration. So a lot of
farmers are having trouble now because they grew excess corn
(12:41):
that they could then sell, you know, to be made
into ethanol. And I think because of our moved by
this government to more like um coal kind of based
things and fossil fuels, those subsidies kind of were changed
in a negative way that affected some of these farmers.
Well yeah, and and also across the world we talked
about this before, been those these things that can be
(13:03):
produced rather cheaply or like, you know, somewhat cheaply in
more rural places. It's like the reason why it represents
that much of the chloric intake is because it's it's
fairly cheap to do, and you can make a lot
of it and it can just be the staple in
your diet. It can be financially cheap, but for those
people who are growing these crops and in developing countries,
(13:26):
it's incredibly time intensive. Right with time exactly. And I
don't mean to downplay what it takes to to totally
have a functioning rice patty or something whis I just
mean overall, if you think about all of the crops
that are out there, the things you could be planting,
that's why these make up that much of the chloric intake.
And that's a huge important point. It's only going to
(13:48):
become more profound as we continue. If we look at
the state's overall, the states in all the U. S territories,
and we'll see that there are some clear front runners
in the farm subsidy industry, and make no mistake, it
is an industry by itself. Those top five states are Texas, Nebraska, Kansas,
shout out to Mission Control, Arkansas, and Illinois. In seventeen,
(14:14):
according to the e w G Farm Subsidy Database, these
five states received thirty eight point five percent of the
seven point to billion dollars distributed through these subsidy programs.
Now astute listeners. Though you'll notice that that number is
much smaller than the number we we cited earlier. Uh,
(14:36):
farm subsidies were twenty two billion, and now if we
go to seen, they're down to seven point two billions.
So we see a lot of waxing and waning here.
It's not a consistent amount of funding. Is odd, just
with inflation and the way that goes overall that it
would reduce by that much, right, right, because you know,
(15:01):
we can explain that by saying, well, different times are changing, right,
and some administrations have different names than others. And of
course it would be naive to say that, uh, some
of the increases were not uh somehow pushed by special
interest groups. Right, that's just the reality. But what about
(15:22):
other what what about other crops? Because those five things
aren't everything people grow. They're also peanuts, sorghum, and mohair.
These things get smaller subsidies. What is mohair? What is sorghum? Paul?
What is mohair? All right, I've just never heard of it.
(15:43):
Mohair is the fabric, That's that's what. That's what Benny
and the Jets were electric boots, a mohair suit. You know,
I read it in a magazine. Uh th that was
a fabric. It is from mohair made from angora goats.
I used to think he was saying mole hair suit,
which would be weird because aren't moles kind of suitless
(16:06):
or like furless? Ye there, Yeah, that goes back to um.
It is interesting because it's like cotton, right, you can't
eat it, so why are we subsidizing it? I believe
it goes back to maybe the nineteen fifties. It's for
goat and sheep producers as they wanted to They wanted
to be able to have the ability to make cheap clothes,
(16:30):
clothing and so on. But what about the other things
we eat? Because unless you're vegan, you're eating other stuff, right,
the stuff other than these grains. You're eating fruits, you're
eating vegetables, and if you're an omnivore, you're eating meat
or and I know there's several of us in the
audience who are like, I'm as close to a carnivore
as you can get. Well, if you're only eating meat,
(16:50):
that still does affect you, because what doi livestock eat.
They eat grains, and the people who create the meat,
fruit and vegetables that you eating, your local grocery store
or restaurant or your local Applebie's. Of course, Uh, they
only benefit from things like crop insurance or disaster relief,
(17:10):
and that still can be a lot of money. Between
seventeen a total of three hundred and sixty nine point
seven billion dollars in crop insurance and disaster relief. We're
paid out to someone, and so that's our lay of
the land. Now, if you if you took a survey
now of the US, you would find that there are
two point one million US farms. Percent of these farms
(17:35):
are I'm gonna I'm gonna say it this way, quote
unquote family owned. Scare quote their family owned. But please
don't think that's like a small one acre field with
someone just growing carrots because they like to know. I mean,
you're you're talking about hundreds of acres A lot of
(17:56):
times dozens would probably be coming. But then thousands of
acres is going to be also, very very common. But
that didn't just happen overnight. These are generationally held lands
that are expanded, you know, and passed down right, Yeah,
I mean we still use phrases relating to that practice
in office jobs across the planet say don't you know,
(18:18):
don't sell the farm, or someone's gonna buy the farm
or farm it out or farm it out there we go, Yes, exactly.
The farm is the one thing that can sustain us
if everything goes bad, I'm gonna send you to the
funny farm. Yeah, now I'm thinking of farm is an
acronym like free all real Americans. I don't know. I'm
(18:38):
working live. This isn't always gonna be a real Americans.
America today feels like that book Animal Farm, And I think,
now you might just be naming things with farming. That's true,
but but yes, yeah, they do play this vital role.
We see it in language. Why are we know why
farms are important? Of course, everybody kind of likes eating.
(18:58):
That's a that's a trend we can rion. But why
are farm subsidies important? Because they get they get a
tough they get a tough run. Occasionally in this country
and in others, people will say, well, you know, farm
subsidies are symptoms of something called protectionism, but of course
(19:20):
they're also necessary. Yeah on some level. Yeah, where are
you going to get all the food that your country
is going to eat, especially in the United States, Well,
you can get it from a bunch of other places.
You have it all shipped in if you want to,
But that's a little dangerous relying, you know, depending on
your percentage of relying on imported foods to feed the
(19:43):
majority of the citizenry. Um, so it is very important
to have that kind of thing in you're not in
your pocket, but at yes exactly, yeah, yeah, because otherwise
you will be at the mercy of the private entity,
the nonprofit or the other country that is feeding you,
or just travel and logistics. I mean, you know, so
(20:04):
many things can break down in a system like that.
Look at what's going on with coronavirus now and how
you know that's really affecting trade with other countries, shipping
and ship exactly. Yeah. Uh. Sales of face mask or
going through the roof even though a lot of people
have no idea how to use them, Yeah, I don't.
I mean, apparently it's largely not to nag anybody or
(20:26):
but if it makes you feel better, But I think
it's largely like almost like ineffective. It's it's not gonna
work if people are already practicing basic hygiene. Right, wash
your hand. You guys know everybody listening, you probably know
the rule. But just to say it. If you're worried
about contracting uh, certain diseases, or if you're in a
place where you think there might be a lot of
(20:47):
nasty bugs around. Whenever you wash your hands, you just
sing in your head or out loud. If you have
a song in your heart, just sing the Happy Birthday
song twice. That's how long you need to wash your
hands to actually disinfect them with soap and water. Yeah,
Or you know, memorize like an m One song or
you know something like that, and you'll you'll be good
(21:08):
to go dead preys maybe way of life with stick Man. Yeah,
just do like if you do that, maybe most of
the song, you're you're good. So you're up early Matt
right to us if you get that reference, right to us,
if you get that reference. So the thing is, you
guys are exactly right. Countries have to have to eat,
and if we don't take proactive steps to ensure that
(21:30):
we have some kind of food supply, then everyone will
be left to the cruel whims of fate. The government
has a job when it comes to food production and
to make sure ideally that regardless of what's going on
with the economy, regardless of what kind of wars are
happening domestically or abroad. People are able to eat, and
(21:51):
that is why food production occupies a weird spot in
the pantheon of domestic businesses. It's kind of like, uh,
you know, a lot of governments support or subsidize their
aircraft industry because they also need planes. Ideally you don't
have to be buying those from another country, So food
(22:12):
has to be in some way supported at least that's
the common the common wisdom so far here in But
there are other reasons we need farm subsidies beyond just
the the brutal realist geopolitics of it. Yeah, and this
is where you get into things like money and how
(22:33):
much it costs. And we're going to talk about that
right after a quick word from our sponsor. We're back.
So I'm going to be completely transparent here. I lived
a long time farmers in my family, but I lived
(22:54):
a long time without knowing the or even understanding the
commodities trade involved. The commodities trade for farmers is essentially
an open exchange where people agree on the price of
a crop. Because we talked about crop prices going up
or going down, but we never talked about how they're
(23:16):
actually assigned. Yeah, how does that number get there? Uh,
it's kind of weird. So they they trade on these
things called futures. Now this isn't too complicated. Think about
it this way. Anytime you plant something in the ground,
it takes a certain amount of time to then harvest
a consumable product, and so within that you get like
(23:38):
this almost like stock market of its own, kind of
where people are like placing bets on the success or
like the way a certain crop will behave. And there's
obviously conditions that feed into that, whether it's whether or
you know, pestilence or any kind of conditions that are
out of people's control. So when you start trading on
future as, you're kind of trading on the promise of
a thing that doesn't exist yet. Um, Like you know
(24:00):
about the tulip bubble in the Netherlands where tulip bulbs
were worth so much money and it created this like
supply that exceeded demand and it just kind of tanked.
But futures is interesting because you're right, Matt, Like they
do it with whiskey too. You you you buy stock
in whiskey barrels that take decades sometimes to age. It's
(24:22):
a really interesting concept of futures. It is a little
weird to wrap your head around, but it also is
strangely straightforward. Ben, does there anything you want to clarify
about that? I think we hit it. Yeah, yeah, it's gambling, right,
it's it is. It is gambling, but it's a necessary
system because you know, imagine you plant a crop at
(24:43):
a time when you saw the crops selling for I'm
just making up numbers here, saw it selling for five
dollars a bushel, and there was nothing like a commodity exchange.
You couldn't make an agreement that your crop would when
it was time to harvest, also sell for five dollar bushel.
And without that, what happens if you put all in,
(25:03):
all this work and now it's only selling for fifty
cents of bushel? You know, it's it's it's a gamble
that people. You could compare it maybe to a utility bill.
Some utility bills will give you the opportunity to pay
your bill on what's called a variable rate, right for
(25:24):
power bill per therm or something, or you can get
a fixed rate for six to twelve months, which maybe
a little higher than you would want, but is it
gives you the advantage of consistency. So that's what people
are looking for. And you know, one of those ways
really screwsy out of money. And I still I'm not
sure which way is the best or the worst, and
(25:45):
I've done both in the course of my lifetime. I
just want to put in ear so we get to
the kind of connected up to the next thing. Just
that concept of betting on what the crop is going
to be like by the time we get around the
harvest time. That concept that I'm gonna lock in this
price with a futures contract of how much bushel is
going to cost or a barrel or whatever it is
(26:07):
is going to cost, and then from that future's contract,
I'm gonna take out giant loans for all this stuff
that that it costs for a ton of money that
it costs to actually make this harvest. Yeah. Yeah, So
a lot of farmers rely on loans. You borrow in
(26:28):
the spring and that's when you plant your seeds, and
then you pay your debt in the fall when you
sell your harvest. And that also makes it feel, you know,
like you're like you're gambling, You're doing a little bit
of roll of the dice in Yolo. People could argue,
but this also means that if you have a few
years where, for one reason or another something completely beyond
(26:50):
your control crops were bad, or crops were good but
prices were low, then you are one catastrophe away from
possibly going under, you know, getting getting the farm uh,
you know, foreclosed upon, or having to sell a bunch
of equipment or something like that. And from the statistics
(27:11):
we saw many farms can't can't survive about two years
of bad luck without going under or getting in serious
trouble because farms can't move. It's the thing. You can't
pull up your tent steaks. Really, I mean, shoot, most
of us, I'm just gonna put myself in this category
can't afford two months of bad luck in their current
(27:34):
financial situation. Just put that out there. So imagining like
being a big business, like a farm with with all
of this uh based on loans that you have to
take out every year. I get anxiety just thinking about it. Man,
whenever somebody asked me to predict specific numbers, it always
feels like a trap. Why else would you ask what
(27:54):
to do that? Yeah, well, I mean you know, it's
a whole different podcast. But this is one of those
things and one of the reasons maybe at some point
we should explore self harm and farmers and like you know,
suicides and things like that. The pressure is just immense,
I mean, to perform and so many things like again
that we were talking about, are out of your control
acts of God, you know, crazy wet weather patterns and storms.
(28:17):
And this idea of you know, climate change maybe or
maybe not being a thing, sure seems like it's a
bit of a thing that has a real impact on
a lot of people's lives, especially in that industry. Agreed,
And so we've we've painted a very broad picture of
of how this industry works. And it seems, like you said, no,
it seems pretty easy to understand once once you go
(28:40):
through some nuts and bolts on it. But not so fast,
because first it appears that the image of the small
family farm that many people outside of farming communities think
of is not as accurate as we might imagine. We
know that it was true at some point, but now
just turn a profit. As as you guys said earlier,
(29:02):
you have to accrete more land volume. Baby economy is
scale capitalism, right, the only the only ideology that can
take a T shirt that says, you know, screw capitalism
and then sell them across the planet fifteen dollars of pop.
I mean, people get mad, but that's that's how the
(29:23):
system works. The problem here is that when it comes
to farm subsidies, ideologies aside a strong body of critics
argue that this system has a dark side, a dark
side that's more expensive than you think. Here's where it
gets crazy. Yeah, I mean, it's no secret that this system,
(29:46):
just like many systems, just isn't perfect. There is an
absolute litany of problems. First, since not all crops are
eligible for subsidies, like we said at the top of
the show, countries can get in to situations where there's
a lack of diversification of crops. Farmers who really need
(30:07):
subsidies might be forced to grow crops that are dictated
by these programs, which affects variety or diversity of agricultural
products in the market, which then ultimately defeats the purpose
of lowering agricultural imports because then products that aren't produced
(30:28):
locally are going to have to be farmed out as
it were elsewhere. Yeah, I mean think about Okay, so
so think about that we're we're the government. We're saying, okay,
we'll pay you uh to give you some to give
you a support net, right, a safety net, rather a
support network, a safety net while you are growing food
(30:51):
for the nation, and we'll try to make sure that
you can make some sort of living off it, but
only if you grow the following things. And then someone's like, well,
I grow tomatoes. You you guys hate to me. What's
what's going to happen? How do I survive as as
the tomato guy? And then they naturally say, and you
can't blame people, they say, well, forget tomatoes. I'm going
(31:13):
to grow a different crop that is way less risky.
That means eventually this domino effect occurs and no one's
growing tomatoes, right, and then something happens where we need tomatoes,
and we think, well, we should have been nicer to
those other countries. You should they come to me a
year ago. No, it's true. I mean you really do
(31:34):
have to do. You have to chase those subsidies in
the same way like film production, as you know the people,
you go where the money is, you go where the
best tax brakes are. And it's just not even a
question like sure, maybe I love blueberries. It's my favorite
fruit of always wanted to be a blueberry farmer. But
there just isn't that same money for blueberries as there
is for for corn yep, and there's not. There's not
(31:59):
a silver Bullets oution for that. Another problem is that
this leads to discrimination against some farmers, right, That's that's
the thing. If you insist on growing a non eligible crop,
then you have a higher chance of failure, and if
you play ball with the government and grow a subsidized crop,
you have a higher chance of success. Somebody's putting their
(32:21):
thumb on the scale. And people who are against government
intervention just in general, right, people who lean a more
a little more libertarian would say this, this is not
the correct way to address the system. That this becomes
big government too quickly. And it is a very it's
a very big bet that we're placing the other problem,
(32:41):
environmental damage. You want. If you were a traditional farming outfit,
then you rotate crops. You plant crop A one season,
you plant crop B another and they kind of interact
with each other to feed the soil to keep it
from being uh the worthless because eventually, if you grow
(33:02):
the same thing. Depending on the crop, then the soil
will just not sustain it. It It won't be as nutrient
rich because all the other identical crops wanted the identical
stuff in the dirt and there's less of it to
go around. It makes sense. I never thought of it
that way. It's really interesting. I I only took one
very minor gardening class at a local place every year,
(33:24):
but it was really that was the big takeaway from me,
was rotating crops and figuring out how you actually get
your soil to be ready for a certain plant and
then switching that out so then the nitrogen gets back
in or the levels of nitrogen and pH balance and
everything gets correct. It's very I mean, it's fascinating. I
never thought about it before. I thought, oh, here's some dirt,
(33:44):
put some stuff in there and then it'll grow. Yeah,
but you have to wait. That's why there's agricultural science colleges.
And the other aspect here is, of course this is related,
but it's not a one to one. Thing is the
enormous use pesticides, which were later proven to be quite
delatorious to uh, anything that wasn't a certain crop, as
(34:08):
well as animals like people, people scoffed at us to
brag a little bit. People scoffed at us back in
two thousand and nine when we said there's solid proof
that a class of pesticides called neo nikotonoids are are
directly responsible for the collapse in domestic b populations. And
(34:29):
it turns out we were right. Well, we the scientists
who did the research, were right, and we just set
it into microphone. We just listened today. Good job, Well,
this this is true. So at this point you might
be saying, wait, how does this affect me, Matt Noel
Mission control bend. I'm not a farmer. I have nothing
(34:51):
against them, but I'm not a farmer. What does this
matter to me other than you know, I'm paying my
tax dollars, right, and I don't have a control of
where they go. And I do like rice cakes, and
I like rice cakes, you know. Uh. And I've always
thought of myself as a blueberry farmer tomato guy, that's right,
My local thie restaurant is like one of my favorite spots.
(35:12):
I can see that because now they finally give you
the appropriate heat, right, yeah, and just really great rice.
This guy's a hard time convincing people in restaurants to
give him the amount of heat or spicy wants tie
places will say you want it tie hot, and they
look at you really serious, and I go, yes, I
mean it. Can you make it hotter? And pro nolan,
(35:33):
I have seen that in action. Don't question me. No,
it's true. Matt is a spice monger. Absolutely spice un
spice lord. Yeah, yeah, spice lord. So traveling without moving,
traveling without moving. So it affects you in another way,
and it's very important. Let's walk through it. When people
(35:55):
are paid to focus on certain crops, those crops end
up being cheaper. And when they end up being cheaper,
they become a more common part of your diet. It's
just easier. And that is why grains overall make up
one fourth of the average American diet. Another fourth of
it is made entirely of oil from corn, soybeans, and canola.
(36:17):
Fruits and vegetables. If you're keeping score, are a ten percent,
less than ten percent and more than six percent of
these farm subsidies go to stuff that your your old
middle school or high school nutrition teacher would have called
junk food, corn syrup, high fruit. This corn syrup which
isn't everything isn't at the top part of the food
(36:40):
pyramid supposed to be Yeah, fat soils, yeah, yeah, it's
supposed to be in the food pyramid has its own problems, right.
But you, if you are from the US, or if
you've ever traveled here, I'm sure you've noticed when you
read the ingredients of stuff that corn is in a
lot of things, not even things you would expect, right,
(37:02):
manufacturing products. And part of that goes back to the subsidies.
So you could build an argument then that the federal government,
through its food subsidization is contributing to America's obesity problem
because again, high fric those corn serupers and everything. I'm
sure our friends Lauren and Annie over on our sister
(37:25):
podcast Savor have an episode about corn syrup. But it
is it can be bad for you, at least when
you're consuming it at the level that most people do.
US farm subsidies also blocked global trade. Uh. This this
is its own thing. We won't spend too much time
on this, but uh, US farm subsidies have an effect
(37:49):
beyond the domestic market. In fact, you can hear multiple
voices in developing countries arguing against these subsidies in developed countries,
because if you're a farmer in a wealthy country that
can pay you a guaranteed price or even give you
a safety net, and if things go sideways, then it's
(38:11):
much easier for you to sell stuff than it is
if you're the same kind of farmer in a less
developed country whose government does not give you subsidies. So
one of the most well known examples of how uh
these policies can affect farms, even even if they're outside
of the country as the subsidies is the relationship between
(38:35):
Haiti and the US involving rice. So Haiti is developing country.
It had the capacity to produce rice. It does have
the capacity, but at one time it was able to
produce all the rice that needed for its people. However,
now that is no longer the case. Six of the
(38:58):
food consumed in Haiti is imported. They lowered tariffs and
so they were flooded with rice that was cheaply produced
in the United States and was able to outcompete rice
farmers in Haiti because they didn't have those subsidies, they
didn't have helping hand from Uncle Sam, and this meant
(39:21):
that the domestically produced rice was displaced so this is
a thing we're removing. That trade barrier led to a
very real cost for the people of or the farmers
of Haiti. So the people of Haiti were able to
get food at a lower cost, but the rice farmers had,
(39:45):
you know, they got painted into a corner. According tox
Fan and the I m F. I actually, I want
to correct myself here. I believe now okay, Haiti is
importing sixty of its food overall, but a e percent
of the rice is imported now, which is crazy because
it would have been if not for this trade stuff,
(40:07):
it would have been entirely self sufficient country. You know this,
This is a real issue here, and I would say
a lot of the problems arise because of the next
thing we're going to talk about. When you're we've the
way we've been talking about this, it makes it feel like, Okay,
it's a farm, it's a family, it's a you know, uh,
(40:28):
you know, whatever you want, whatever a family looks like
to you. It's that just living on a farm and
producing a thing. But as we find, these subsidies are
not necessarily for that type of farming situation. And we'll
get to that after a word from our sponsor and
(40:52):
we're back. There's another problem, and you can see it
in the example that we just gave about the Haitian
rice and and a deal stuff. That's that's a whole
different bag of badgers. The point we're making is that
these subsidies overall throughout the world, in whichever country they occur,
they tend to help high income business, not the poor
(41:14):
rural farmers that so many people think of when they
hear the word family well when they hear the term
family farm. As a matter of fact, the majority of
this money goes to huge agribusinesses and the numbers are spooky.
So between nine seventeen, the top ten percent of recipients
got seventy seven percent of the two hundred and five
(41:37):
point four billion that was distributed, and that is according
to the e w G Farm Subsidy Database. Then the
top one percent received twenty percent of the payments, and
that kind of averages out to around one point seven
million per company. Fifty people on the Forbes four hundred
lists of the wealthiest human beings in America received farm subsidies.
(42:00):
On the other hand, sixty of US farms did not
get any. And you remember Raven who wrote to us
at the top of the show and include us into
this topic. We will let this savvy listener sum it up.
We've got rice Lands Foods Incorporated at five hundred and
fifty four million dollars, producers, Rice Mill Incorporated, UH three
(42:23):
million dollars, farmers, Rice co Op hundred forty six million
dollars UH number four only forty eight million received, and
it trickles down from there. It's pretty big. Describe a
big old dip in. Uh So, what's what's the deal? Well,
the one thing you'll notice is that it's all sure,
(42:46):
very uncreatively named corporations, if I might add, and it's
a precipitous dip from one rank to the next, from
five fifty four all the way down to three four
and then number four. Only forty eight million, I say,
only forty eight millions. I don't think any of us
have been in a situation where we said, you know,
it's only forty eight million. It's not like fifty. We
(43:09):
can still go to David Busters later. Sorry, it's it's
my dream to be to David Busters with an ungodly
amount of money. I wouldn't you rather have David Busters tickets?
I guess so, yeah, yeah, I would want to participate
in their currency. Right, they won't take your money there.
David Busters only tickets. I don't know why casinos bothered me,
(43:30):
but I love David Busters. It's kind of the same thing,
but for kids, right well, se yeah, I mean it's
it's half it's really for drunk adults kind of more
than anything. Okay, well I haven't been. I haven't been
in a long time. I thought you'd never been. It's
about to be very sad for you talk about it
so much. Yeah, I love the idea of it. At least,
when are we gonna go? Let's we should go. That's
(43:51):
our show, folks. You guys want to go to Chunky
Cheese with me and my kid? Yeah, because you have
to have a kid. It's like a playground at a
public park, right, it's creepy if you don't have a
kid there. Not to divert too much from the topic
of hand, but did you guys know, maybe I've mentioned before,
they have this crazy system where when you go in,
you get an invisible ink stamp on your hand and
(44:11):
on your kid's hand, and they have to match, and
they like shine a light on you before you leave,
to make sure you're not like running off with someone
else's kid. Pretty clever I can do in this system. Yeah, yeah,
I mean I'll go. I'll go with you Matt if it.
Yeah yeah. Do they have ski ball? They do? They
have laser Tag. No, I'll still go, but I won't
(44:34):
stay along. They have this Yoshi's Haunted Mansion game that
is pretty awesome. I'm in. I'man assuming that this whole
thing doesn't burn down before we get a chance to go. Raven,
you also noted the possibility of another conspiracy, and we'll
quote from your letter here. You said the bigger payouts
(44:55):
were substantially higher than all other years, and they happened
at the same time two thousand, two thousand one, two
thousand two. Now, remember we had that statistic that you
quoted at the top. Theirinal in the subsidies were huge.
There were twenty two billion dollars. But Raven says, I
(45:16):
don't see a record of a natural disaster or anything
that could warrant the need for so much assistance. Raven
continues and says, for a company like rice Land Foods
that boast almost a million dollars a year in revenue,
why would they need so much in subsidies? And why
are the top three also rice Riceland Foods and producers
(45:37):
Rice mill are both also based in Stuttguard, Arkansas. That's
a place with less than nine thousand people. And so
this leads Raven to conclude what the US just pays
them to exist. Plus they get insurance so if they
lose money, they can file in insurance claim. You can't
tell me, says Raven. There's no conspiracy here. So I
(45:58):
have to ask you guys, you know, is it is
it possible that this is corruption? Is this what is
it pork barrel politics? Is somebody pocketing these millions of dollars?
I mean, these are corporations, so I'm sure that the
executive suites are, you know, getting their vague in the
form of bonuses or performance compensation or something. I would say,
(46:21):
it just feels a bit odd because you know, they
need that money to stay in business. It it does
feel weird that the companies wouldn't attempt to like pivot
to maybe something else. It wouldn't require that level of
like I think it was fifty of the profits coming
(46:42):
from or fifty five of their income coming from government subsidies.
It seems like you'd you'd have to switch and start
doing something else, just knowing that if you end up
losing those subsidies, depending on who's in office and the way,
you know, the winds of change from whatever government becomes,
you know, whatever as to which crops become priority. I mean,
(47:04):
like as to whether or not those subsidies continue, because
they may not, because there's a big debate now about
a lot of times it's portrayed as in one hand,
you have subsidizing crops and farms, in the other hand,
you have snap and uh, you know, helping those who
are in need. Like like, yeah, food stamps are just
(47:27):
food assistance programs. So in a lot of times it's
not those those two things aren't necessarily connected. But maybe
it's just they appear to be connected in people's minds,
and lately they've been tied together in like taking money
away from food assistance and adding money to subsidizing farms.
(47:48):
The idea of being that those two things are so
inextricably intertwined that you're kind of putting money in the
same place in a weird but that's yeah, I wouldn't
you say that's somewhat disingenuous. I think it's very disingenuous
because you what you could be doing is all of
those over you know, creating too much supply, and all
(48:12):
of these things being paid not to create food. Why
would you just not have specialized processors like farmers and
processors to make specialized foods that are then specifically for
those programs that are just then free. They're paid for
with the subsidy itself. Well, ultimately the bill comes due,
you know, someone gets left holding the end voice at
(48:34):
the end of the day. But it is a good
question because governments also try to get in front of this,
for lack of a better corporate term, by buying up
those excess crops and saving them for a rainy day
or saving them for people who need assistance. But also,
you know, it is not disingenuous to argue that snap
(48:56):
and agricultural subsidies are related, because if the government is
paying for um for food assistance of some sort, then
it wants the lowest price, right. And it's strange because
you can see how there might be a conflict of
interest there at some point, like if you if you
(49:19):
put too much money into subsidizing farms, maybe it affects
the price of food that the government pays for under
snap in in a way that they didn't anticipate or
in a way that they do not find favorable. So
sometimes the left hand doesn't know what the right hand
is doing here. And that's not saying that anybody is
(49:39):
necessarily a bad actor. That's just saying that this is
a complex system with a lot of moving parts, a
lot of stakeholders, and a lot of people with goals
that contradict one another. So of course they're gonna butt heads.
But one thing is for sure, raven Uh, there is
a lot of money in play here, and money tends
to make p both, if not terrible, a little less
(50:03):
worried about ethics in general. Related episode, for anyone who
hasn't heard it, check out check out the podcast that
Matt Nolan I did on whether wealth makes you a
bad person. Studies are fairly conclusive and terrified, like you're
(50:24):
literally more likely to take candy from children. Someone did
that study and I think replicated it. Money can't buy happiness,
but it's sure can make you an a soul. There
we go, There we go. I want that crocheted and
hanging up somewhere, you know, one of those little circle frames,
you know. Yeah, I want to carry that as a
(50:44):
placard around and replace all the live, laugh love signs
I see with with that, I can't do that. You
can't replace other people's signs. It's up to them, you know,
if they want to live, they want to laugh. Wow,
I sound like a monster. Hey, I want to bring
up monster. Sure? Uh No, I want to bring us up.
There's something I was reading earlier today about finding ways
(51:05):
to get more money out of these farm subsidies. And
it was and correct me if I'm wrong, Ben, Paul Noel,
uh or you listening out there. Um, I believe the
amount of money you can get in this subsidy for
farming was eighty thousand dollars per individual. Then you could
go into like a co op or into a UM,
(51:30):
create a group or company. Then that has um a
group of individuals, and then each one of them could
get eighty thousand, and then that co op can get
a you know, a much larger sum in subsidies from
the government. Then you can use that for a larger
farming operation essentially, And I I don't know exactly what
the limits are for any of that stuff. But it
does seem as though you could exploit this system in
(51:53):
a couple of ways just by teaming up. Is that
do we know if that's correct? It's they're definitely they're
definitely loopholes that are in play. I mean, that's the
only way that uh, only a hundred thousand individuals could
collect se of the money at play here. So then
I just wonder what the we're We aren't able to
(52:15):
really explore the full numbers here, but how that is
affected when you, let's say you build those numbers up
and you have a large enough operation that you do
get into the you know, five hundred million dollars subsidy
range um. That's ah, that's pretty astonishing. And I wonder
(52:38):
at what point that five million dollars is actually sustaining
and making like generating real wealth for the individuals involved
as we were talking about, Like, I wonder how wealthy
actually some of the people running those large companies are. Right,
because you've heard the phrase land rich, cash poor. There
can be people like through a variety of different financial instruments,
(53:03):
you can you can appear to be much you can
appear to have much less or much more money than
you actually possess, you know what I mean, especially when
you're leveraging loans, leveraging future speculation gets involved. It's true,
there there is a lot of money at play, and
there are many opportunities to game the system. That is
(53:24):
not the same thing as saying that people are thieving
or doing that. You know that they're purposely doing that,
just saying the opportunity is there. We do know that
the farm subsided program, at least the modern version of it,
has occupied a special place in the halls of Congress
and in the halls of various presidential administrations. Like you
(53:44):
guys remember, uh, the auto industry bailout, right or the
bank bailout. People were up in arms, torches, pitchforks, you know,
both sides of Congress had some had some angry words
to say, and it was hotly debated. But the U.
S d A created the new farm subsidy program just
(54:05):
like out of thin air. Congress didn't really have anything
to say about it. Uh, And we know that if
we look at the state of subsidies today, Uh, they're
they're going to continue. In twenty nineteen, the federal government
delivered the biggest aid package it had delivered in fourteen years.
(54:26):
You know, the price of farm subsidies has spiked. These
subsidies aren't going to go away. They may wax and
wayne in terms of the total money paid out by
the government and hence the taxpayer. And the question is
should they go away? Because we know that there's growing
instability in the global climate, and we know that that
(54:49):
means even just that alone means that further government intervention
is probably in the cards. Even people who would otherwise say,
you know, no big government whatsoever, even those people will
will sometimes make an exception and come out in defense
of things like, you know, the military, right, or the
(55:11):
agricultural industry, especially if they're involved in the farming industry
and are otherwise solidly libertarian. I'll say this is different
because everybody needs to eat. Now, what do you think
about this, folks? What are farm subsidies? Are they in
economic necessity? Are they an opportunity for a quagmire of
(55:31):
large scale billion dollar level corruption? Are the fun combo
like a number two? The yeah? Is it? Is it
a necessity? And corruption with a side of fries in
sour gum? And when what is it? Mohir and Mohair
mohir container just sprinkled on top. Yeah, you don't like
(55:54):
a little hair on your burger? No, I I feel
like that's not a hot take. I don't think So
what if we get so many emails from people who
are like, I can't believe you guys eat on hairy burgers?
Have you ever got a hair stuck in your throat
and you pull it out and it just doesn't stop?
Like a gross stage magician, just like the like the ring. Yeah,
(56:15):
I never had that, man. You Nope, me either. Okay, good,
I was worried for a second. Uh. But but we
do want to we do want to hear from you
because this is this is a very serious topic. There's
a lot of money on the table, and one of
the one of the biggest points we have to make
(56:36):
before we end the episode today is this. Obviously, this
weird arrangement has has a lot of imperfections. Obviously there's
plenty of room for conspiracy and corruption and later cover ups,
but that should not be taken in any way to
be an allegation against all farmers. Farmers throughout American history
(57:00):
and in the modern day are some of the hardest
working individuals in this country. Full stop. There you go.
That's exactly what I would say. Paul, do you wanna
do you wanna give shout out to any farmers out
there that have been listening to the show, he says.
Paul says, I send you my admiration and love. Um
(57:22):
and oh he's given me his phone number. Okay, uh
oh no, he says he's going to retract that, but
he does send his admiration. So we in the room
here only get his contempt and icy stairs. But but
you know, it's he's a he's a tough love producer.
You gotta respect the guy. So it's all about the
(57:43):
chase with Paul, so as he is gonna kill us.
So as always, we want to thank you for tuning in.
We want to hear from you. You can find us
any number of ways because this concludes our episode, but
not our show. Some of the best parts of our
episodes are the parts that you generate in conversation with
(58:04):
our fellow listeners. Online. You can find us on Facebook,
you can find us on Twitter, you can find us
on Instagram. We love to recommend our community page. Here's
where it gets crazy. If you don't want to do that,
but you should but if you don't want to, you
can give us a call. Our number is one eight
three three st d w y t K. Leave us
(58:25):
a message, tell us what you're thinking. We look forward
to talk into you and or at least hearing from you,
and then maybe you'll get a call back. Who knows. Um,
if you if you feel like this whole episode was
just a giant tease to hear Paul's voice and you
didn't get it, head on over to movie Crush. You
can find him. You search up his name, Paul decant Uh,
searching on the internet if you want to track him down. UM, don't,
(58:49):
don't you know, not like in a creepy early super
creepy way. Just do it in a standard creepy way,
you know, waiting outside, staring up at as window in
the rain. It's all good, holding up a giant jukebox
playing in your eyes by Peter Gabriel or you know,
whatever your choice of music. Just make it happen. I
would say Casey Musgrove is probably a good good call. Uh,
(59:13):
it's a weird plug for that. I have no idea
what I would say that or if if you know,
if you have if you have input here and especially
if you have personal experience with farm subsidies and you
have seen, you know, allegations of corruption, or you have
seen the system work beautifully. We want to hear from you.
If you're one of those people and you say, I
(59:35):
have something to say. I hate the Internet. I remember
your Facebook episode from a few years ago. We do too.
We do too, And I, like many people, hate using phones.
But I want to contact you somehow while you are
in luck, friends and neighbors. We have one more way
to contact us. You can send us a good old
fashioned email. We are conspiracy at iHeart radio dot com
(01:00:00):
m H. Stuff They Don't Want You to Know is
a production of I Heart Radio's How Stuff Works. For
(01:00:20):
more podcasts from my heart Radio, visit the I heart
Radio app, Apple Podcasts, or wherever you listen to your
favorite shows.
From UFOs to psychic powers and government conspiracies. History is
riddled with unexplained events. You can turn back now or
learn the stuff they don't want you to know. A
production of I Heart Brading. Welcome back to the show.
(00:25):
My name is Matt, my name is Nol. They called
me Ben, and you're joined as always with our super
producer Paul Mission Control decond. Most importantly, you are you.
You are here, and that makes this stuff they don't
want you to know. This is going to be an
interesting episode today. I want to go ahead and congratulate
everyone who did not judge today's episode by the title alone.
(00:50):
I think the title of this is actually the surprisingly
unboring story of farm subsidies. Yeah, it could be interpreted
as a snooze fest, but you know, you know us,
you know this show. There's not a snooze fest amongst.
It remas me of that part in Wayne's World where
he's doing the green screen and he's like, hey, I'm
in Delaware because Delaware seems like the most boring place,
(01:13):
but as it turns out, it's incredible tax haven. Yeah,
that's true, secret excitement all around. That's why all of
your credit cards and many of your banks are based
for some reason in Delaware, Dover, I believe because the
laws are different. Now, this topic was not something that
(01:33):
the three or four of us came up with on
our own, Like many of the best suggestions for this show,
this came to us from a listener email from the
Raven with a Y. Now, the Raven, maybe I can
remove the definitive there and just call you Raven. Uh.
(01:54):
You sent us this fantastic email. It's it's a little
bit long, so we're just gonna read some excerpts, but
we're gonna set it up. And Uh, I gotta say,
my friend, I like the way you right, Oh for sure,
especially adding adding in your own sound effects. Says greetings, gentlemen,
I bring you information for a possible episode. The topic
(02:17):
may seem boring on the surface, but I feel as
though something is a miss I present to you. Farm
subsidies submitted for your approval. Don't done. Yes, my friends,
farm subsidies. I don't know much about it, but I
noticed odd things with a specific company, so there may
be other things out there. Here are the facts. First off,
(02:43):
there's no such thing as a dumb question, So what
the hell is a farm subsidies. Farm subsidies are essentially
cash given from a government. The US does this as
well as many other countries to support agribusinesses. These can
be absolute life savers because being a farmer is difficult.
(03:05):
It's a dicey proposition. Farmers can use the money provided
by the government to ride out risk and the potentially
enormous losses involved in this unpredictable industry. Like you can't
predict the weather all the time, you can't predict how
you're going to interact with commodities brokers. You can't predict
demand as accurately as people would want. Farm subsidies are
(03:31):
a thing that is pretty close to mission controls heart. Uh.
And we did check to make sure it's okay that
we said that. But you know us, we always we
always like to lean on people with personal experience. We
like primary sources. So if you hear us pausing when
we say something and then quickly correcting ourselves, it maybe
(03:53):
because Paul gave us the glare of death through the
studio window. And this is a little known here, This
has never happened before. Paul's Mike Mission controls. Mike is
alive right now, So like if he wanted to, he
could say a word, but he's not going to. I'm
(04:13):
feeling a sense of foreboding. Said that, he's like this
cartoon rabbits. So it's like, if you don't have something
nice to say, don't say nothing at all. So Paul
is going to chime in if he has something nice,
A k A helpful correct. Yes, farm subsidies, though you
may have heard them tossed around in in a lot
(04:36):
of headlines recently, you're gonna read language like farm bailout. Yes,
that's the one that I've seen the most. So these
things have a long, long history here in the US.
The Homestead Act in eighteen sixty two granted land in
the West to anyone willing to farm. It said, just
show up, make food, and you can have the land
(04:59):
it grows on. And then in the same year there
was something called the Moral Act m O R R
I L L that was past This funded colleges of agriculture.
So Uncle Sam always knew that food was important, and
the government intervened multiple times throughout this country's history to
(05:19):
assist assist in the creation of farming interest like the
Federal Farm Loan Act that would give you pretty generous
loans if and only if you're a farmer or starting
a farm. Yeah, it's one of those things is humans. Um,
we need water, we need to be able to breathe,
we need shelter, we need love, and we need food.
(05:41):
Food is very important, and food production becomes very very important,
especially when you're in a time of crisis, like of war.
Let's say that's why this, uh, the subsidizing were the
assistance with farming is so essential because each of us
has to eat. So let's them to nineteen twenty nine.
(06:02):
Let's do it nineteen nine, in which the Agricultural Marketing
Act of ninety nine it established the Federal Farm Board,
which sought to keep crop prices manageable, keep them from
absolutely bottoming out. So farmers were, um. The hope was
(06:23):
that they would limit crops, but that didn't really take um,
and then the bureau bought and stockpiled these crops in
order to you know, kind of manipulate supply and demand
by limiting supply. And then um, it kind of switched
gears and transformed into the Farm Credit Administration in nineteen
(06:48):
thirty three, and then in nineteen thirty three, Congress signs
what's called the Agricultural Adjustment Actor A A A. Again,
I know we can get the weeds here, but this stuff,
this will be important later when we get to the
weird part of this. We'll all be glad that we
know this now. So this Triple A Agricultural Adjustment Act did,
(07:09):
uh did something very similar to what you were talking about.
It reduced crop output. It paid farmers to not do
their job. And you think, why on earth would you
do that? Do we need more food? Isn't this whole
thing about all of us needing to eat? Right? But
you also want people to make a living because if
(07:30):
everybody is growing a ton of this an example, Paul use,
if everybody has a bumper crop and grows a great
amount of wheat, then how are they going to be
able to sell it? Because the price will plummet And
then you're you, as a farmer, are being punished for
doing well. So, yeah, you're right. It really is about
(07:52):
supply and demand. And this Triple A this had some
extreme results. Crop prices in general doubled within just four years,
and the Supreme Court overturned the Triple A because it
was it was putting taxes on people who processed crops,
(08:18):
but it was giving money to farmers, and then they
tried to fix it again in ninety eight, and then
when a lot of farms were being foreclosed upon, the
Emergency Farm Mortgage Act was a government intervention that gave
farms the life saving loans they needed to continue their businesses.
(08:38):
So in the same year, in eight, we've got the
New Agricultural Adjustment Act creatively named because it was like
the new one UM, and that kind of took care
of some of the issues that were presented by the
nineteen thirty three version UM. And this price support system
as it was referred to, kind of uh petered out
(08:58):
in the nineteen nine these Well that's exactly yeah, but
but that's sort of when it run its course, and
the federal government was able to pretty astoundingly guarantee farmers
a high enough price to stay in business, to actually
make a profit for their families. How is this accomplished? Well, Uh,
it paid farmers to make sure again manipulating supply and demand,
(09:23):
make sure the supply did not exceed the demand. Then
the government subsidized farmers to keep crop lands idle so
fallow fields, essentially in order to prevent um. Basically waste
crop waste over production also actually bought out any excess
(09:44):
crops UM it then either stockpiled them or gave them
away to lower income families throughout the world. So it
had kind of a philanthropic wing to it as well.
And then in for arm subsidies. UM, it's kind of
the year for peak farm subsidies when it reached a
record twenty two billion dollars. Can I bring something up
(10:10):
here that we that happened in nineteen nine. I think
it's something that Paul was talking to us about earlier
off Mike called the Conservation Reserve Program. UM. Can we
talk about that now, Yeah, exactly, because we we kind
of just mentioned it there. UM. It's called the Conservation
Reserve Program or CRP, and I'm reading this from the
(10:31):
f s A dot U, s d A dot Gov. Um,
this is a program that UH, in exchange for a
yearly rental payment, farmers enrolled in this program agree to
remove environmentally sensitive land from agricultural production and plant species
that will improve the environmental health and quality. So it's
(10:52):
these it's these contracts and not a contract. I guess
it's you sign up for this program, then portions of
your farmland are just kind of let to go wild basically,
which allows the soil to regenerate. It's probably better for
local wildlife, you know, especially herbivores amongst the fauna. Uh.
Then we can see the logic here, even though it
(11:13):
sounds maybe a little Joseph Heller esk at first, like
what you're paying me not to do something? But it
fields many people argue that it is necessary. Of course,
not every anybody who has ever tried to buy like
a dragon for or a pomegranate quickly learns or avocados
(11:34):
for good, to say, quickly learns that not all crops
are subsidized here in the US. Out of all of
the crops that farmers grow, there are only five that
are subsidized, corn, soybeans, wheat, cotton, and rice. And that's
because the grains here in this list are the big,
(11:54):
big players. If you just took the edible stuff from
what we named rice, wheat, beans, corned and you added
up all you added up all of those crops, and
then you looked at how much food all the people
on earth collectively, eight eighty percent of it would be rice, wheat, soybeans,
and corn, think about food processing and how many products
(12:18):
exist in grocery stores across the world that are based
in one of those or if not multiple, well not
even not only stuff in grocery stores. Think about ethanol
that comes from corn, and I don't want to jump
the gun. I'm sure we're gonna get into this a
little more later, but I believe some of those subsidies
went away under the Trump administration. So a lot of
farmers are having trouble now because they grew excess corn
(12:41):
that they could then sell, you know, to be made
into ethanol. And I think because of our moved by
this government to more like um coal kind of based
things and fossil fuels, those subsidies kind of were changed
in a negative way that affected some of these farmers.
Well yeah, and and also across the world we talked
about this before, been those these things that can be
(13:03):
produced rather cheaply or like, you know, somewhat cheaply in
more rural places. It's like the reason why it represents
that much of the chloric intake is because it's it's
fairly cheap to do, and you can make a lot
of it and it can just be the staple in
your diet. It can be financially cheap, but for those
people who are growing these crops and in developing countries,
(13:26):
it's incredibly time intensive. Right with time exactly. And I
don't mean to downplay what it takes to to totally
have a functioning rice patty or something whis I just
mean overall, if you think about all of the crops
that are out there, the things you could be planting,
that's why these make up that much of the chloric intake.
And that's a huge important point. It's only going to
(13:48):
become more profound as we continue. If we look at
the state's overall, the states in all the U. S territories,
and we'll see that there are some clear front runners
in the farm subsidy industry, and make no mistake, it
is an industry by itself. Those top five states are Texas, Nebraska, Kansas,
shout out to Mission Control, Arkansas, and Illinois. In seventeen,
(14:14):
according to the e w G Farm Subsidy Database, these
five states received thirty eight point five percent of the
seven point to billion dollars distributed through these subsidy programs.
Now astute listeners. Though you'll notice that that number is
much smaller than the number we we cited earlier. Uh,
(14:36):
farm subsidies were twenty two billion, and now if we
go to seen, they're down to seven point two billions.
So we see a lot of waxing and waning here.
It's not a consistent amount of funding. Is odd, just
with inflation and the way that goes overall that it
would reduce by that much, right, right, because you know,
(15:01):
we can explain that by saying, well, different times are changing, right,
and some administrations have different names than others. And of
course it would be naive to say that, uh, some
of the increases were not uh somehow pushed by special
interest groups. Right, that's just the reality. But what about
(15:22):
other what what about other crops? Because those five things
aren't everything people grow. They're also peanuts, sorghum, and mohair.
These things get smaller subsidies. What is mohair? What is sorghum? Paul?
What is mohair? All right, I've just never heard of it.
(15:43):
Mohair is the fabric, That's that's what. That's what Benny
and the Jets were electric boots, a mohair suit. You know,
I read it in a magazine. Uh th that was
a fabric. It is from mohair made from angora goats.
I used to think he was saying mole hair suit,
which would be weird because aren't moles kind of suitless
(16:06):
or like furless? Ye there, Yeah, that goes back to um.
It is interesting because it's like cotton, right, you can't
eat it, so why are we subsidizing it? I believe
it goes back to maybe the nineteen fifties. It's for
goat and sheep producers as they wanted to They wanted
to be able to have the ability to make cheap clothes,
(16:30):
clothing and so on. But what about the other things
we eat? Because unless you're vegan, you're eating other stuff, right,
the stuff other than these grains. You're eating fruits, you're
eating vegetables, and if you're an omnivore, you're eating meat
or and I know there's several of us in the
audience who are like, I'm as close to a carnivore
as you can get. Well, if you're only eating meat,
(16:50):
that still does affect you, because what doi livestock eat.
They eat grains, and the people who create the meat,
fruit and vegetables that you eating, your local grocery store
or restaurant or your local Applebie's. Of course, Uh, they
only benefit from things like crop insurance or disaster relief,
(17:10):
and that still can be a lot of money. Between
seventeen a total of three hundred and sixty nine point
seven billion dollars in crop insurance and disaster relief. We're
paid out to someone, and so that's our lay of
the land. Now, if you if you took a survey
now of the US, you would find that there are
two point one million US farms. Percent of these farms
(17:35):
are I'm gonna I'm gonna say it this way, quote
unquote family owned. Scare quote their family owned. But please
don't think that's like a small one acre field with
someone just growing carrots because they like to know. I mean,
you're you're talking about hundreds of acres A lot of
(17:56):
times dozens would probably be coming. But then thousands of
acres is going to be also, very very common. But
that didn't just happen overnight. These are generationally held lands
that are expanded, you know, and passed down right, Yeah,
I mean we still use phrases relating to that practice
in office jobs across the planet say don't you know,
(18:18):
don't sell the farm, or someone's gonna buy the farm
or farm it out or farm it out there we go, Yes, exactly.
The farm is the one thing that can sustain us
if everything goes bad, I'm gonna send you to the
funny farm. Yeah, now I'm thinking of farm is an
acronym like free all real Americans. I don't know. I'm
(18:38):
working live. This isn't always gonna be a real Americans.
America today feels like that book Animal Farm, And I think,
now you might just be naming things with farming. That's true,
but but yes, yeah, they do play this vital role.
We see it in language. Why are we know why
farms are important? Of course, everybody kind of likes eating.
(18:58):
That's a that's a trend we can rion. But why
are farm subsidies important? Because they get they get a
tough they get a tough run. Occasionally in this country
and in others, people will say, well, you know, farm
subsidies are symptoms of something called protectionism, but of course
(19:20):
they're also necessary. Yeah on some level. Yeah, where are
you going to get all the food that your country
is going to eat, especially in the United States, Well,
you can get it from a bunch of other places.
You have it all shipped in if you want to,
But that's a little dangerous relying, you know, depending on
your percentage of relying on imported foods to feed the
(19:43):
majority of the citizenry. Um, so it is very important
to have that kind of thing in you're not in
your pocket, but at yes exactly, yeah, yeah, because otherwise
you will be at the mercy of the private entity,
the nonprofit or the other country that is feeding you,
or just travel and logistics. I mean, you know, so
(20:04):
many things can break down in a system like that.
Look at what's going on with coronavirus now and how
you know that's really affecting trade with other countries, shipping
and ship exactly. Yeah. Uh. Sales of face mask or
going through the roof even though a lot of people
have no idea how to use them, Yeah, I don't.
I mean, apparently it's largely not to nag anybody or
(20:26):
but if it makes you feel better, But I think
it's largely like almost like ineffective. It's it's not gonna
work if people are already practicing basic hygiene. Right, wash
your hand. You guys know everybody listening, you probably know
the rule. But just to say it. If you're worried
about contracting uh, certain diseases, or if you're in a
place where you think there might be a lot of
(20:47):
nasty bugs around. Whenever you wash your hands, you just
sing in your head or out loud. If you have
a song in your heart, just sing the Happy Birthday
song twice. That's how long you need to wash your
hands to actually disinfect them with soap and water. Yeah,
Or you know, memorize like an m One song or
you know something like that, and you'll you'll be good
(21:08):
to go dead preys maybe way of life with stick Man. Yeah,
just do like if you do that, maybe most of
the song, you're you're good. So you're up early Matt
right to us if you get that reference, right to us,
if you get that reference. So the thing is, you
guys are exactly right. Countries have to have to eat,
and if we don't take proactive steps to ensure that
(21:30):
we have some kind of food supply, then everyone will
be left to the cruel whims of fate. The government
has a job when it comes to food production and
to make sure ideally that regardless of what's going on
with the economy, regardless of what kind of wars are
happening domestically or abroad. People are able to eat, and
(21:51):
that is why food production occupies a weird spot in
the pantheon of domestic businesses. It's kind of like, uh,
you know, a lot of governments support or subsidize their
aircraft industry because they also need planes. Ideally you don't
have to be buying those from another country, So food
(22:12):
has to be in some way supported at least that's
the common the common wisdom so far here in But
there are other reasons we need farm subsidies beyond just
the the brutal realist geopolitics of it. Yeah, and this
is where you get into things like money and how
(22:33):
much it costs. And we're going to talk about that
right after a quick word from our sponsor. We're back.
So I'm going to be completely transparent here. I lived
a long time farmers in my family, but I lived
(22:54):
a long time without knowing the or even understanding the
commodities trade involved. The commodities trade for farmers is essentially
an open exchange where people agree on the price of
a crop. Because we talked about crop prices going up
or going down, but we never talked about how they're
(23:16):
actually assigned. Yeah, how does that number get there? Uh,
it's kind of weird. So they they trade on these
things called futures. Now this isn't too complicated. Think about
it this way. Anytime you plant something in the ground,
it takes a certain amount of time to then harvest
a consumable product, and so within that you get like
(23:38):
this almost like stock market of its own, kind of
where people are like placing bets on the success or
like the way a certain crop will behave. And there's
obviously conditions that feed into that, whether it's whether or
you know, pestilence or any kind of conditions that are
out of people's control. So when you start trading on
future as, you're kind of trading on the promise of
a thing that doesn't exist yet. Um, Like you know
(24:00):
about the tulip bubble in the Netherlands where tulip bulbs
were worth so much money and it created this like
supply that exceeded demand and it just kind of tanked.
But futures is interesting because you're right, Matt, Like they
do it with whiskey too. You you you buy stock
in whiskey barrels that take decades sometimes to age. It's
(24:22):
a really interesting concept of futures. It is a little
weird to wrap your head around, but it also is
strangely straightforward. Ben, does there anything you want to clarify
about that? I think we hit it. Yeah, yeah, it's gambling, right,
it's it is. It is gambling, but it's a necessary
system because you know, imagine you plant a crop at
(24:43):
a time when you saw the crops selling for I'm
just making up numbers here, saw it selling for five
dollars a bushel, and there was nothing like a commodity exchange.
You couldn't make an agreement that your crop would when
it was time to harvest, also sell for five dollar bushel.
And without that, what happens if you put all in,
(25:03):
all this work and now it's only selling for fifty
cents of bushel? You know, it's it's it's a gamble
that people. You could compare it maybe to a utility bill.
Some utility bills will give you the opportunity to pay
your bill on what's called a variable rate, right for
(25:24):
power bill per therm or something, or you can get
a fixed rate for six to twelve months, which maybe
a little higher than you would want, but is it
gives you the advantage of consistency. So that's what people
are looking for. And you know, one of those ways
really screwsy out of money. And I still I'm not
sure which way is the best or the worst, and
(25:45):
I've done both in the course of my lifetime. I
just want to put in ear so we get to
the kind of connected up to the next thing. Just
that concept of betting on what the crop is going
to be like by the time we get around the
harvest time. That concept that I'm gonna lock in this
price with a futures contract of how much bushel is
going to cost or a barrel or whatever it is
(26:07):
is going to cost, and then from that future's contract,
I'm gonna take out giant loans for all this stuff
that that it costs for a ton of money that
it costs to actually make this harvest. Yeah. Yeah, So
a lot of farmers rely on loans. You borrow in
(26:28):
the spring and that's when you plant your seeds, and
then you pay your debt in the fall when you
sell your harvest. And that also makes it feel, you know,
like you're like you're gambling, You're doing a little bit
of roll of the dice in Yolo. People could argue,
but this also means that if you have a few
years where, for one reason or another something completely beyond
(26:50):
your control crops were bad, or crops were good but
prices were low, then you are one catastrophe away from
possibly going under, you know, getting getting the farm uh,
you know, foreclosed upon, or having to sell a bunch
of equipment or something like that. And from the statistics
(27:11):
we saw many farms can't can't survive about two years
of bad luck without going under or getting in serious
trouble because farms can't move. It's the thing. You can't
pull up your tent steaks. Really, I mean, shoot, most
of us, I'm just gonna put myself in this category
can't afford two months of bad luck in their current
(27:34):
financial situation. Just put that out there. So imagining like
being a big business, like a farm with with all
of this uh based on loans that you have to
take out every year. I get anxiety just thinking about it. Man,
whenever somebody asked me to predict specific numbers, it always
feels like a trap. Why else would you ask what
(27:54):
to do that? Yeah, well, I mean you know, it's
a whole different podcast. But this is one of those
things and one of the reasons maybe at some point
we should explore self harm and farmers and like you know,
suicides and things like that. The pressure is just immense,
I mean, to perform and so many things like again
that we were talking about, are out of your control
acts of God, you know, crazy wet weather patterns and storms.
(28:17):
And this idea of you know, climate change maybe or
maybe not being a thing, sure seems like it's a
bit of a thing that has a real impact on
a lot of people's lives, especially in that industry. Agreed,
And so we've we've painted a very broad picture of
of how this industry works. And it seems, like you said, no,
it seems pretty easy to understand once once you go
(28:40):
through some nuts and bolts on it. But not so fast,
because first it appears that the image of the small
family farm that many people outside of farming communities think
of is not as accurate as we might imagine. We
know that it was true at some point, but now
just turn a profit. As as you guys said earlier,
(29:02):
you have to accrete more land volume. Baby economy is
scale capitalism, right, the only the only ideology that can
take a T shirt that says, you know, screw capitalism
and then sell them across the planet fifteen dollars of pop.
I mean, people get mad, but that's that's how the
(29:23):
system works. The problem here is that when it comes
to farm subsidies, ideologies aside a strong body of critics
argue that this system has a dark side, a dark
side that's more expensive than you think. Here's where it
gets crazy. Yeah, I mean, it's no secret that this system,
(29:46):
just like many systems, just isn't perfect. There is an
absolute litany of problems. First, since not all crops are
eligible for subsidies, like we said at the top of
the show, countries can get in to situations where there's
a lack of diversification of crops. Farmers who really need
(30:07):
subsidies might be forced to grow crops that are dictated
by these programs, which affects variety or diversity of agricultural
products in the market, which then ultimately defeats the purpose
of lowering agricultural imports because then products that aren't produced
(30:28):
locally are going to have to be farmed out as
it were elsewhere. Yeah, I mean think about Okay, so
so think about that we're we're the government. We're saying, okay,
we'll pay you uh to give you some to give
you a support net, right, a safety net, rather a
support network, a safety net while you are growing food
(30:51):
for the nation, and we'll try to make sure that
you can make some sort of living off it, but
only if you grow the following things. And then someone's like, well,
I grow tomatoes. You you guys hate to me. What's
what's going to happen? How do I survive as as
the tomato guy? And then they naturally say, and you
can't blame people, they say, well, forget tomatoes. I'm going
(31:13):
to grow a different crop that is way less risky.
That means eventually this domino effect occurs and no one's
growing tomatoes, right, and then something happens where we need tomatoes,
and we think, well, we should have been nicer to
those other countries. You should they come to me a
year ago. No, it's true. I mean you really do
(31:34):
have to do. You have to chase those subsidies in
the same way like film production, as you know the people,
you go where the money is, you go where the
best tax brakes are. And it's just not even a
question like sure, maybe I love blueberries. It's my favorite
fruit of always wanted to be a blueberry farmer. But
there just isn't that same money for blueberries as there
is for for corn yep, and there's not. There's not
(31:59):
a silver Bullets oution for that. Another problem is that
this leads to discrimination against some farmers, right, That's that's
the thing. If you insist on growing a non eligible crop,
then you have a higher chance of failure, and if
you play ball with the government and grow a subsidized crop,
you have a higher chance of success. Somebody's putting their
(32:21):
thumb on the scale. And people who are against government
intervention just in general, right, people who lean a more
a little more libertarian would say this, this is not
the correct way to address the system. That this becomes
big government too quickly. And it is a very it's
a very big bet that we're placing the other problem,
(32:41):
environmental damage. You want. If you were a traditional farming outfit,
then you rotate crops. You plant crop A one season,
you plant crop B another and they kind of interact
with each other to feed the soil to keep it
from being uh the worthless because eventually, if you grow
(33:02):
the same thing. Depending on the crop, then the soil
will just not sustain it. It It won't be as nutrient
rich because all the other identical crops wanted the identical
stuff in the dirt and there's less of it to
go around. It makes sense. I never thought of it
that way. It's really interesting. I I only took one
very minor gardening class at a local place every year,
(33:24):
but it was really that was the big takeaway from me,
was rotating crops and figuring out how you actually get
your soil to be ready for a certain plant and
then switching that out so then the nitrogen gets back
in or the levels of nitrogen and pH balance and
everything gets correct. It's very I mean, it's fascinating. I
never thought about it before. I thought, oh, here's some dirt,
(33:44):
put some stuff in there and then it'll grow. Yeah,
but you have to wait. That's why there's agricultural science colleges.
And the other aspect here is, of course this is related,
but it's not a one to one. Thing is the
enormous use pesticides, which were later proven to be quite
delatorious to uh, anything that wasn't a certain crop, as
(34:08):
well as animals like people, people scoffed at us to
brag a little bit. People scoffed at us back in
two thousand and nine when we said there's solid proof
that a class of pesticides called neo nikotonoids are are
directly responsible for the collapse in domestic b populations. And
(34:29):
it turns out we were right. Well, we the scientists
who did the research, were right, and we just set
it into microphone. We just listened today. Good job, Well,
this this is true. So at this point you might
be saying, wait, how does this affect me, Matt Noel
Mission control bend. I'm not a farmer. I have nothing
(34:51):
against them, but I'm not a farmer. What does this
matter to me other than you know, I'm paying my
tax dollars, right, and I don't have a control of
where they go. And I do like rice cakes, and
I like rice cakes, you know. Uh. And I've always
thought of myself as a blueberry farmer tomato guy, that's right,
My local thie restaurant is like one of my favorite spots.
(35:12):
I can see that because now they finally give you
the appropriate heat, right, yeah, and just really great rice.
This guy's a hard time convincing people in restaurants to
give him the amount of heat or spicy wants tie
places will say you want it tie hot, and they
look at you really serious, and I go, yes, I
mean it. Can you make it hotter? And pro nolan,
(35:33):
I have seen that in action. Don't question me. No,
it's true. Matt is a spice monger. Absolutely spice un
spice lord. Yeah, yeah, spice lord. So traveling without moving,
traveling without moving. So it affects you in another way,
and it's very important. Let's walk through it. When people
(35:55):
are paid to focus on certain crops, those crops end
up being cheaper. And when they end up being cheaper,
they become a more common part of your diet. It's
just easier. And that is why grains overall make up
one fourth of the average American diet. Another fourth of
it is made entirely of oil from corn, soybeans, and canola.
(36:17):
Fruits and vegetables. If you're keeping score, are a ten percent,
less than ten percent and more than six percent of
these farm subsidies go to stuff that your your old
middle school or high school nutrition teacher would have called
junk food, corn syrup, high fruit. This corn syrup which
isn't everything isn't at the top part of the food
(36:40):
pyramid supposed to be Yeah, fat soils, yeah, yeah, it's
supposed to be in the food pyramid has its own problems, right.
But you, if you are from the US, or if
you've ever traveled here, I'm sure you've noticed when you
read the ingredients of stuff that corn is in a
lot of things, not even things you would expect, right,
(37:02):
manufacturing products. And part of that goes back to the subsidies.
So you could build an argument then that the federal government,
through its food subsidization is contributing to America's obesity problem
because again, high fric those corn serupers and everything. I'm
sure our friends Lauren and Annie over on our sister
(37:25):
podcast Savor have an episode about corn syrup. But it
is it can be bad for you, at least when
you're consuming it at the level that most people do.
US farm subsidies also blocked global trade. Uh. This this
is its own thing. We won't spend too much time
on this, but uh, US farm subsidies have an effect
(37:49):
beyond the domestic market. In fact, you can hear multiple
voices in developing countries arguing against these subsidies in developed countries,
because if you're a farmer in a wealthy country that
can pay you a guaranteed price or even give you
a safety net, and if things go sideways, then it's
(38:11):
much easier for you to sell stuff than it is
if you're the same kind of farmer in a less
developed country whose government does not give you subsidies. So
one of the most well known examples of how uh
these policies can affect farms, even even if they're outside
of the country as the subsidies is the relationship between
(38:35):
Haiti and the US involving rice. So Haiti is developing country.
It had the capacity to produce rice. It does have
the capacity, but at one time it was able to
produce all the rice that needed for its people. However,
now that is no longer the case. Six of the
(38:58):
food consumed in Haiti is imported. They lowered tariffs and
so they were flooded with rice that was cheaply produced
in the United States and was able to outcompete rice
farmers in Haiti because they didn't have those subsidies, they
didn't have helping hand from Uncle Sam, and this meant
(39:21):
that the domestically produced rice was displaced so this is
a thing we're removing. That trade barrier led to a
very real cost for the people of or the farmers
of Haiti. So the people of Haiti were able to
get food at a lower cost, but the rice farmers had,
(39:45):
you know, they got painted into a corner. According tox
Fan and the I m F. I actually, I want
to correct myself here. I believe now okay, Haiti is
importing sixty of its food overall, but a e percent
of the rice is imported now, which is crazy because
it would have been if not for this trade stuff,
(40:07):
it would have been entirely self sufficient country. You know this,
This is a real issue here, and I would say
a lot of the problems arise because of the next
thing we're going to talk about. When you're we've the
way we've been talking about this, it makes it feel like, Okay,
it's a farm, it's a family, it's a you know, uh,
(40:28):
you know, whatever you want, whatever a family looks like
to you. It's that just living on a farm and
producing a thing. But as we find, these subsidies are
not necessarily for that type of farming situation. And we'll
get to that after a word from our sponsor and
(40:52):
we're back. There's another problem, and you can see it
in the example that we just gave about the Haitian
rice and and a deal stuff. That's that's a whole
different bag of badgers. The point we're making is that
these subsidies overall throughout the world, in whichever country they occur,
they tend to help high income business, not the poor
(41:14):
rural farmers that so many people think of when they
hear the word family well when they hear the term
family farm. As a matter of fact, the majority of
this money goes to huge agribusinesses and the numbers are spooky.
So between nine seventeen, the top ten percent of recipients
got seventy seven percent of the two hundred and five
(41:37):
point four billion that was distributed, and that is according
to the e w G Farm Subsidy Database. Then the
top one percent received twenty percent of the payments, and
that kind of averages out to around one point seven
million per company. Fifty people on the Forbes four hundred
lists of the wealthiest human beings in America received farm subsidies.
(42:00):
On the other hand, sixty of US farms did not
get any. And you remember Raven who wrote to us
at the top of the show and include us into
this topic. We will let this savvy listener sum it up.
We've got rice Lands Foods Incorporated at five hundred and
fifty four million dollars, producers, Rice Mill Incorporated, UH three
(42:23):
million dollars, farmers, Rice co Op hundred forty six million
dollars UH number four only forty eight million received, and
it trickles down from there. It's pretty big. Describe a
big old dip in. Uh So, what's what's the deal? Well,
the one thing you'll notice is that it's all sure,
(42:46):
very uncreatively named corporations, if I might add, and it's
a precipitous dip from one rank to the next, from
five fifty four all the way down to three four
and then number four. Only forty eight million, I say,
only forty eight millions. I don't think any of us
have been in a situation where we said, you know,
it's only forty eight million. It's not like fifty. We
(43:09):
can still go to David Busters later. Sorry, it's it's
my dream to be to David Busters with an ungodly
amount of money. I wouldn't you rather have David Busters tickets?
I guess so, yeah, yeah, I would want to participate
in their currency. Right, they won't take your money there.
David Busters only tickets. I don't know why casinos bothered me,
(43:30):
but I love David Busters. It's kind of the same thing,
but for kids, right well, se yeah, I mean it's
it's half it's really for drunk adults kind of more
than anything. Okay, well I haven't been. I haven't been
in a long time. I thought you'd never been. It's
about to be very sad for you talk about it
so much. Yeah, I love the idea of it. At least,
when are we gonna go? Let's we should go. That's
(43:51):
our show, folks. You guys want to go to Chunky
Cheese with me and my kid? Yeah, because you have
to have a kid. It's like a playground at a
public park, right, it's creepy if you don't have a
kid there. Not to divert too much from the topic
of hand, but did you guys know, maybe I've mentioned before,
they have this crazy system where when you go in,
you get an invisible ink stamp on your hand and
(44:11):
on your kid's hand, and they have to match, and
they like shine a light on you before you leave,
to make sure you're not like running off with someone
else's kid. Pretty clever I can do in this system. Yeah, yeah,
I mean I'll go. I'll go with you Matt if it.
Yeah yeah. Do they have ski ball? They do? They
have laser Tag. No, I'll still go, but I won't
(44:34):
stay along. They have this Yoshi's Haunted Mansion game that
is pretty awesome. I'm in. I'man assuming that this whole
thing doesn't burn down before we get a chance to go. Raven,
you also noted the possibility of another conspiracy, and we'll
quote from your letter here. You said the bigger payouts
(44:55):
were substantially higher than all other years, and they happened
at the same time two thousand, two thousand one, two
thousand two. Now, remember we had that statistic that you
quoted at the top. Theirinal in the subsidies were huge.
There were twenty two billion dollars. But Raven says, I
(45:16):
don't see a record of a natural disaster or anything
that could warrant the need for so much assistance. Raven
continues and says, for a company like rice Land Foods
that boast almost a million dollars a year in revenue,
why would they need so much in subsidies? And why
are the top three also rice Riceland Foods and producers
(45:37):
Rice mill are both also based in Stuttguard, Arkansas. That's
a place with less than nine thousand people. And so
this leads Raven to conclude what the US just pays
them to exist. Plus they get insurance so if they
lose money, they can file in insurance claim. You can't
tell me, says Raven. There's no conspiracy here. So I
(45:58):
have to ask you guys, you know, is it is
it possible that this is corruption? Is this what is
it pork barrel politics? Is somebody pocketing these millions of dollars?
I mean, these are corporations, so I'm sure that the
executive suites are, you know, getting their vague in the
form of bonuses or performance compensation or something. I would say,
(46:21):
it just feels a bit odd because you know, they
need that money to stay in business. It it does
feel weird that the companies wouldn't attempt to like pivot
to maybe something else. It wouldn't require that level of
like I think it was fifty of the profits coming
(46:42):
from or fifty five of their income coming from government subsidies.
It seems like you'd you'd have to switch and start
doing something else, just knowing that if you end up
losing those subsidies, depending on who's in office and the way,
you know, the winds of change from whatever government becomes,
you know, whatever as to which crops become priority. I mean,
(47:04):
like as to whether or not those subsidies continue, because
they may not, because there's a big debate now about
a lot of times it's portrayed as in one hand,
you have subsidizing crops and farms, in the other hand,
you have snap and uh, you know, helping those who
are in need. Like like, yeah, food stamps are just
(47:27):
food assistance programs. So in a lot of times it's
not those those two things aren't necessarily connected. But maybe
it's just they appear to be connected in people's minds,
and lately they've been tied together in like taking money
away from food assistance and adding money to subsidizing farms.
(47:48):
The idea of being that those two things are so
inextricably intertwined that you're kind of putting money in the
same place in a weird but that's yeah, I wouldn't
you say that's somewhat disingenuous. I think it's very disingenuous
because you what you could be doing is all of
those over you know, creating too much supply, and all
(48:12):
of these things being paid not to create food. Why
would you just not have specialized processors like farmers and
processors to make specialized foods that are then specifically for
those programs that are just then free. They're paid for
with the subsidy itself. Well, ultimately the bill comes due,
you know, someone gets left holding the end voice at
(48:34):
the end of the day. But it is a good
question because governments also try to get in front of this,
for lack of a better corporate term, by buying up
those excess crops and saving them for a rainy day
or saving them for people who need assistance. But also,
you know, it is not disingenuous to argue that snap
(48:56):
and agricultural subsidies are related, because if the government is
paying for um for food assistance of some sort, then
it wants the lowest price, right. And it's strange because
you can see how there might be a conflict of
interest there at some point, like if you if you
(49:19):
put too much money into subsidizing farms, maybe it affects
the price of food that the government pays for under
snap in in a way that they didn't anticipate or
in a way that they do not find favorable. So
sometimes the left hand doesn't know what the right hand
is doing here. And that's not saying that anybody is
(49:39):
necessarily a bad actor. That's just saying that this is
a complex system with a lot of moving parts, a
lot of stakeholders, and a lot of people with goals
that contradict one another. So of course they're gonna butt heads.
But one thing is for sure, raven Uh, there is
a lot of money in play here, and money tends
to make p both, if not terrible, a little less
(50:03):
worried about ethics in general. Related episode, for anyone who
hasn't heard it, check out check out the podcast that
Matt Nolan I did on whether wealth makes you a
bad person. Studies are fairly conclusive and terrified, like you're
(50:24):
literally more likely to take candy from children. Someone did
that study and I think replicated it. Money can't buy happiness,
but it's sure can make you an a soul. There
we go, There we go. I want that crocheted and
hanging up somewhere, you know, one of those little circle frames,
you know. Yeah, I want to carry that as a
(50:44):
placard around and replace all the live, laugh love signs
I see with with that, I can't do that. You
can't replace other people's signs. It's up to them, you know,
if they want to live, they want to laugh. Wow,
I sound like a monster. Hey, I want to bring
up monster. Sure? Uh No, I want to bring us up.
There's something I was reading earlier today about finding ways
(51:05):
to get more money out of these farm subsidies. And
it was and correct me if I'm wrong, Ben, Paul Noel,
uh or you listening out there. Um, I believe the
amount of money you can get in this subsidy for
farming was eighty thousand dollars per individual. Then you could
go into like a co op or into a UM,
(51:30):
create a group or company. Then that has um a
group of individuals, and then each one of them could
get eighty thousand, and then that co op can get
a you know, a much larger sum in subsidies from
the government. Then you can use that for a larger
farming operation essentially, And I I don't know exactly what
the limits are for any of that stuff. But it
does seem as though you could exploit this system in
(51:53):
a couple of ways just by teaming up. Is that
do we know if that's correct? It's they're definitely they're
definitely loopholes that are in play. I mean, that's the
only way that uh, only a hundred thousand individuals could
collect se of the money at play here. So then
I just wonder what the we're We aren't able to
(52:15):
really explore the full numbers here, but how that is
affected when you, let's say you build those numbers up
and you have a large enough operation that you do
get into the you know, five hundred million dollars subsidy
range um. That's ah, that's pretty astonishing. And I wonder
(52:38):
at what point that five million dollars is actually sustaining
and making like generating real wealth for the individuals involved
as we were talking about, Like, I wonder how wealthy
actually some of the people running those large companies are. Right,
because you've heard the phrase land rich, cash poor. There
can be people like through a variety of different financial instruments,
(53:03):
you can you can appear to be much you can
appear to have much less or much more money than
you actually possess, you know what I mean, especially when
you're leveraging loans, leveraging future speculation gets involved. It's true,
there there is a lot of money at play, and
there are many opportunities to game the system. That is
(53:24):
not the same thing as saying that people are thieving
or doing that. You know that they're purposely doing that,
just saying the opportunity is there. We do know that
the farm subsided program, at least the modern version of it,
has occupied a special place in the halls of Congress
and in the halls of various presidential administrations. Like you
(53:44):
guys remember, uh, the auto industry bailout, right or the
bank bailout. People were up in arms, torches, pitchforks, you know,
both sides of Congress had some had some angry words
to say, and it was hotly debated. But the U.
S d A created the new farm subsidy program just
(54:05):
like out of thin air. Congress didn't really have anything
to say about it. Uh, And we know that if
we look at the state of subsidies today, Uh, they're
they're going to continue. In twenty nineteen, the federal government
delivered the biggest aid package it had delivered in fourteen years.
(54:26):
You know, the price of farm subsidies has spiked. These
subsidies aren't going to go away. They may wax and
wayne in terms of the total money paid out by
the government and hence the taxpayer. And the question is
should they go away? Because we know that there's growing
instability in the global climate, and we know that that
(54:49):
means even just that alone means that further government intervention
is probably in the cards. Even people who would otherwise say,
you know, no big government whatsoever, even those people will
will sometimes make an exception and come out in defense
of things like, you know, the military, right, or the
(55:11):
agricultural industry, especially if they're involved in the farming industry
and are otherwise solidly libertarian. I'll say this is different
because everybody needs to eat. Now, what do you think
about this, folks? What are farm subsidies? Are they in
economic necessity? Are they an opportunity for a quagmire of
(55:31):
large scale billion dollar level corruption? Are the fun combo
like a number two? The yeah? Is it? Is it
a necessity? And corruption with a side of fries in
sour gum? And when what is it? Mohir and Mohair
mohir container just sprinkled on top. Yeah, you don't like
(55:54):
a little hair on your burger? No, I I feel
like that's not a hot take. I don't think So
what if we get so many emails from people who
are like, I can't believe you guys eat on hairy burgers?
Have you ever got a hair stuck in your throat
and you pull it out and it just doesn't stop?
Like a gross stage magician, just like the like the ring. Yeah,
(56:15):
I never had that, man. You Nope, me either. Okay, good,
I was worried for a second. Uh. But but we
do want to we do want to hear from you
because this is this is a very serious topic. There's
a lot of money on the table, and one of
the one of the biggest points we have to make
(56:36):
before we end the episode today is this. Obviously, this
weird arrangement has has a lot of imperfections. Obviously there's
plenty of room for conspiracy and corruption and later cover ups,
but that should not be taken in any way to
be an allegation against all farmers. Farmers throughout American history
(57:00):
and in the modern day are some of the hardest
working individuals in this country. Full stop. There you go.
That's exactly what I would say. Paul, do you wanna
do you wanna give shout out to any farmers out
there that have been listening to the show, he says.
Paul says, I send you my admiration and love. Um
(57:22):
and oh he's given me his phone number. Okay, uh
oh no, he says he's going to retract that, but
he does send his admiration. So we in the room
here only get his contempt and icy stairs. But but
you know, it's he's a he's a tough love producer.
You gotta respect the guy. So it's all about the
(57:43):
chase with Paul, so as he is gonna kill us.
So as always, we want to thank you for tuning in.
We want to hear from you. You can find us
any number of ways because this concludes our episode, but
not our show. Some of the best parts of our
episodes are the parts that you generate in conversation with
(58:04):
our fellow listeners. Online. You can find us on Facebook,
you can find us on Twitter, you can find us
on Instagram. We love to recommend our community page. Here's
where it gets crazy. If you don't want to do that,
but you should but if you don't want to, you
can give us a call. Our number is one eight
three three st d w y t K. Leave us
(58:25):
a message, tell us what you're thinking. We look forward
to talk into you and or at least hearing from you,
and then maybe you'll get a call back. Who knows. Um,
if you if you feel like this whole episode was
just a giant tease to hear Paul's voice and you
didn't get it, head on over to movie Crush. You
can find him. You search up his name, Paul decant Uh,
searching on the internet if you want to track him down. UM, don't,
(58:49):
don't you know, not like in a creepy early super
creepy way. Just do it in a standard creepy way,
you know, waiting outside, staring up at as window in
the rain. It's all good, holding up a giant jukebox
playing in your eyes by Peter Gabriel or you know,
whatever your choice of music. Just make it happen. I
would say Casey Musgrove is probably a good good call. Uh,
(59:13):
it's a weird plug for that. I have no idea
what I would say that or if if you know,
if you have if you have input here and especially
if you have personal experience with farm subsidies and you
have seen, you know, allegations of corruption, or you have
seen the system work beautifully. We want to hear from you.
If you're one of those people and you say, I
(59:35):
have something to say. I hate the Internet. I remember
your Facebook episode from a few years ago. We do too.
We do too, And I, like many people, hate using phones.
But I want to contact you somehow while you are
in luck, friends and neighbors. We have one more way
to contact us. You can send us a good old
fashioned email. We are conspiracy at iHeart radio dot com
(01:00:00):
m H. Stuff They Don't Want You to Know is
a production of I Heart Radio's How Stuff Works. For
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more podcasts from my heart Radio, visit the I heart
Radio app, Apple Podcasts, or wherever you listen to your
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