Another week has gone by and another 2,300 page government reform bill (sidebar – that no one really understands) has passed. While most of the press has focused on changes to the banking industry and Wall Street, there are some provisions that will affect agriculture. The Des Moines Register recently discussed one change (Financial Bill Could Ease Commodities’ Volatility) that many farmers and end users of commodities may appreciate. It’s designed to reduce and discourage much of the speculative trading that is thought to create violent swings in prices. This was especially apparent in 2008 when corn prices rose to as high as $8.00 per bushel. It should be duly noted that most farmers did profit from the speculator’s actions. But some argue that the price swings were too extreme to be justified from what was truly happening in the marketplace.
I do believe that when a market or industry is inherently broken and can’t fix itself, then the government should step in. However, as we’ve seen the past few months, Washington is bypassing what may be simple solutions with major, new, untested regulations. And to be honest, I find this trend to be frightening. Overhauling large parts of the U.S. economy, often considered the most stable and efficient in the world, will create many unforeseen problems, many of them unintended. Yet the public is told by our politicians to “trust us, we know what’s best for you.” Isn’t that a scary thought.
Tags: agriculture, farmers, government
