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Iowa Ag Review

Abstract

Cogent justifi cations for continuing subsidies to U.S. crop farmers are diffi cult to fi nd. Most analyses suggest that our farm programs lead to greater concentration, higher land prices and cash rents, increased production of supported commodities, and lower market prices. And as we have pointed out in recent Iowa Ag Review articles, current subsidy programs provide a quite ineffi cient safety net: overcompensating producers in low price–high production years and undercompensating them in high price–low production years. In addition, farm subsidies go predominantly to farm families that have higher wealth and income levels than the average U.S. family. And fi nally, there would be no major changes in aggregate food production or food prices in the United States if subsidies were ended tomorrow.