Originally Posted By: Pop_Rivit
You should brush up on a bit of history. The price support program for raisins, as well as other price support/subsidy programs, made a lot of sense as we were coming out of the depression. Without it there are a number of ag industries that would have collapsed over the years or prices would have skyrocketed for many different ag commodities.
It is one of the primary reasons why we have the world's most abundant food supply and relatively stable prices. The supports need limits, reviews and expirations, along with the goal of becoming self-sustaining, not government dependent. Once that goal is recognized, the program should be phased out. Instead, programs like this are too often used far beyond the point that the objective was achieved.
Price support schemes, production quotas, subsidy programs, and other "big government" stuff from the federal government have never been necessary. What really works is to have a futures market for commodities, which is what we have for most agricultural products and other things like minerals and currencies. A futures market allows producers and buyers of products to hedge their future sales/purchases, removing a good share of the risk. The speculators, who are commonly villified, actually play an important role by taking the other side of the hedgers' transactions and making the market more liquid. The role that government plays is to make sure everybody plays fair. You cannot allow a big buyer or a group of colluding buyers to put a "short squeeze" on the market by buying everything in sight and holding onto it until the price rises.