Thursday, December 22, 2005

The Wheat Board... ahh socialism

Harper finally announced that if the Conservatives win power than they will make participation in the Wheat Board voluntary. About time! This archaic policy dictates that farmers are forced to sell their individually produced harvests to the government for a set price regardless of their preferences. This “progressive” policy invalidates the farmers right to freedom and self determination by confiscating the rewards of his labor and then determining their worth. Farmers that have refused to sell their grains to the government and instead chosen to do their own negotiating have been arrested by federal government. In a free country men that produce noble bounties of sustenance through the virtues of hard work and intelligence are not imprisoned for negotiating a price for them.

Besides the moral and philosophical reasons to end the coercive Wheat Board there are also practical economic reasons to end the monopoly. Funding any bureaucratic administration is expensive. Government employees are well paid have generous benefits and little is expected of them so there tends to be a lot of them doing very little. This is cost is burdened by the farmers. The government offered price for harvests will always have to factor in these costs. With these mandated inflated expenses take into consideration that the government has little incentive to search out new markets or expand current ones as their salaries are guaranteed by the public which would be the exact opposite of competing private marketing firms.

Wheat is not just wheat. There is high quality wheat that is used for breads and such and then there are low quality wheat that can only be used as cattle feed. In a free market the higher the quality of the wheat the higher the price it will fetch. Since the government sells the wheat collectively-- for instance to Sudan-- there is little incentive to grow the highest quality grains as the price the farmer receives is not determined by his own particular crop but rather the average of all the crops. So if there are locusts down south and drought out west should you waste your money and time digging an irrigation canal to improve your own harvest? If everyone else is having a poor year why struggle to produce the highest quality of grain when there is no reward for doing so?. There is absolutely no incentive left to produce a better quality crop. Should you invest the time to research a new technology that makes crop resistant to drought when your crops will valued according to your neighbors? No because you will receive the set rate. A set collective rate for all crops penalizes the virtue of diligence, hard work and innovation and rewards the vices of apathy and laziness.

This is also a government that doles out subsidy based on losses. Picture a bunch of farmers consistently trying to demonstrate their farming misfortunes instead of improving their product. It easier to con the government than it is to grow top quality crops in a competitive market.

And perhaps the worst intentionally orchestrated result of this communist program is its discouragement of secondary industry. The Wheat Board is a subsidy to the raw export of grains. An artificial value is added to the export of grain to the government which discourages the development of the grain locally. Where is the thriving food processing industry that should be present in Saskatchewan? There isn’t one because grain can’t be easily purchased by private companies. Rather the farmer is forced to sell his grain to the government and then the government decides where and whom they wheat will be sold. This is why there is a more food processing in Ontario than in Saskatchewan. In a government controlled market the local mill’s advantage of proximity to agricultural markets (proximity ensures any competent businessman can produce milled grain cheaper then the Ontario mill as he will have to factor in export costs) is nullified by government policy. Saskatchewan and Manitoba should both have thriving economies based on their access to agricultural markets and because of interventionist Government policy they do not.

4 Comments:

At 2:54 AM, Anonymous Anonymous said...

What alarms me (and one columnist from Calgary Sun wrote of it recently) is that a Canadian farmer selling his own wheat goes to jail, but Liberals stealing tax payers money does not.

 
At 9:51 AM, Anonymous Anonymous said...

Are you saying that the Wheat Board should be eliminated completely? Or do you want the free market system with socialism as a back up?

 
At 11:02 AM, Blogger angryroughneck said...

The farming community has become too accustomed to the WheatBoard for an instant ending of the program. a mandated immediate end would be cruel and unfair to the farming industry. Giving Farmers a choice between private and public markets will let farmers move gradually into the private system and with increased returns to farmers doing their own marketing the transitision will happen fast until nobody uses the wheatboard. And so it will collapse from lack of use rather than mandate.

 
At 3:54 PM, Blogger Joe Green said...

What a right wing cop-out!

The facts are that the family farm is under siege from capitalists, from the oil and gas mongols in Houston, the fertilizer "industry" and of course, all the right wing pigs in Alberta that have stolen the public utilities built by previous generations, in order to build horse stables in Calgary and install privatized gold plated toilet seats for their patrician patrons. But for these "capitalists", the family farms of today would be thriving in Canada.

The proper answer is not only to keep the Wheat Board, but to strengthen its powers against convicted criminal organizations like Archers Daniels Midland, where surprise, surprise, Lyin Brian Mulroney and Emperor George Bush I share seats as "directors".

Sometimes you lying right wing pukes make me sick with your pretensions at scholarship and criticism.

 

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