Thursday, May 23, 2019

MFP II Announced

NY Times writes about trade policy and Trump's trade war, including the announcement of $16 billion in MFP II.

Chris Clayton's article at DTN  has the details on the program, which has three tranches and uses county payment rates among other differences from MFP I.  He also notes Trump's lie about the history of farm income:
"President Trump reiterated, falsely, that farmers have seen a 20-year steady decline of income, despite farm income peaking in 2013. As a key part of the president's rural base, Trump reiterated, "They [farmers] are patriots. They stood up and they were with me. They didn't say 'Oh we shouldn't do this because we're going to have a bad year. They have had 20 bad years if you really look."
The county payment rate will be new and a challenge to implement. [Update: When I wrote this, I was wrong.  I was thinking county/crop payment rates, which I never dealt with back in the day, but the fact is FSA has had experience with them, both through price supports and the new 21st century programs which I don't understand.  However, the idea is one country price for all crop acreage, regardless of the crop planted.  That, I think,  raises new problems.  If all farmers in the county raise crops in the same proportion, it could work.  But that's a big "if".  Say a country produces corn and soybeans 50/50, so the county rate is based on that proportion. But take a farmer who plants only corn, which I'm assuming is less affected by the trade war, she will get a higher rate than she "deserves".  Conversely the farmer who plants only soybeans will be screwed.  (Obviously I'm using extreme examples.)]

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