Washington--A page one story in yesterday'sWall Street Journal reports that high grain prices mean that the price support formula of the farm program is not kicking in. “The market, in other words, has done what decades ofpolitical wrangling couldn’t: slash farm subsidies,” according to the Journal.
The newspaper reports that farm program payments have always ebbed and flowed with commodity prices, but many economists believe an upward shift in crop prices means that Midwestern farmers won’t need price support payments in the future.
“There remain other types of subsidies, which continue to pay out because they aren’t linked to market prices. But high prices are undermining political support for those programs, especially as Congress and the White House get serious about restraining federal spending, amid trillion-dollar deficits and a political brouhaha over the federal debt ceiling,” according to the Journal.