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Lesson on subsidies
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Subsidies
What factors influence your family’s choices about what
to eat?
The Gonzalez Family
http://www.pbs.org/pov/foodinc/video_dollar.php
What is a subsidy?
Form of financial assistance provided by the government, for industries, companies and individuals
Farm subsidies – ensure that farms can make a profit and stay in business,
In some cases to insulate farms from the impact of a bad growing seasonEnsure farms won’t have to raise the price of their products, which could make out food more expensive.
American agricultural subsidy:
– Tax dollars paid to farmers and large agribusinesses as additional income to allow the government to manage the cost and supply of specific crops. In the United States, corn growers receive the most federal assistance, resulting in an abundance of corn being grown and then sold at a low price. Other subsidized crops include soybeans, wheat, rice, sugar and cotton.
How do farm subsidies affect the prices of certain types of
food?
Subsidies in Malawi
A closer look at Malawi
Agriculture employs 80% of the country’s workforce
President Bingu wa Mutharika introduced the Farm Input Subsidy Program (FISP) in 2005 to bring food security
Subsidized fertilizer so farmers could successfully plant and reap yields to feed themselves as well as others**
Tobacco, sugar, coffee, and tea are important cash crops in Malawi
Doesn’t go without difficulties
Malawi results
http://www.youtube.com/watch?v=lf2jAavbqOg
Malawi and AmericaPROS
Mitigate the effects of disaster
Manage the supply of foodSteady domestic supply of basic commodities for its citizens
CONSAmerican agriculture has changed.
1933 - 25% were farmers. Now 2% are farmers
Subsidies can stifle competition
Subsidies drive production decisions.
Expensive
Voters choice?
Since this is our tax money, what kind of aid would you wanted give to farmers?