Lately there’s been news about farmers protesting for more subsidies, etc, and I’ve thought about this issue for the first time. It is really complicated. I had always wondered why we give subsidies to farmers and had assumed it was mostly because the government didn’t want them losing their jobs.There’s a lot more to it than that. The biggest concern I’ve run into is that it boils down to a national-security issue. Imagine the extreme case where all of one country’s food gets imported because local farmers can’t compete and go out of business. That country is now very vulnerable should they or their major trade partners ever be attacked.

But, there are reasonable arguments on the other side as well. Farms in North America are surviving today because the small family ones have mostly gone out of business and large corporate farms are taking over. Even though their labour costs are much higher than those of other countries they can achieve some economies of scale. If subsidies were removed perhaps they’d simply go through another round of consolidation and still be able to compete. I personally don’t like that family farms have mostly disappeared, but does it make sense to artificially keep ourselves halfway between the two extremes?

Even though subsidies may be needed they do seem like a band-aid. I wonder if there’s a way to bake the subsidies into the price of the items that would equalize against the cheaper imports as well, like price minimums. That does seem hard to enforce though.

Some more discussion on the topic from Wikipedia