The Last Farm Bill?

Keith Good posts a Dan Morgan article on the farm, discussing the misfit between the current economic outlook for farmers and the programs of the past. He passes along this speculation:

The impasse has led some to suggest the unthinkable: This could be the last farm bill of its kind, and perhaps even the last farm bill.

That possibility was advanced privately last week by several serious policy analysts and former senior government officials attending Informa Economics, Inc.’s annual conference on food and agriculture policy in Arlington, Va.

Imagine, they suggested, that the current high prices are not just a blip but a permanent new condition, much like high oil prices. In that case, the commodity title of the farm bill will look increasingly irrelevant. Government price guarantees will no longer be operative at their current levels, and the billions of dollars in direct payments to farmers will become politically unsupportable.

I'm not convinced by the premise. Sure, the rapid rise of people from poverty to middle class tastes in Asia and elsewhere creates more markets for more food and more meat. The growing acceptance of global warming and the promotion of biofuel creates new markets for stuff that grows. The growth of locavore and slow food and organic creates new niches to absorb the products of the land.

But, it will take a while, but this too is a bubble like others we've seen. $20 wheat is growing to seriously focus the minds of growers everywhere. $20 wheat will pay for equipment and fertilizer and buying up land and putting under management that can grow. (Note: "$20 wheat" is just a symbol of the prices.) U.S. farmers need to make hay while the sun shines, because the one thing that's sure is that rain will follow sun.