Living Not Surviving – by Ahmed SeragDespite the near 17 TRILLION dollars in debt this country already has, and the complete failure of federal bailout programs throughout recent and past decades, and despite the Congress of the United States being on the brink of passing an unfunded 1 TRILLION dollar farm bill-which the house thankfully just rejected 234-195-the United States Department of Agriculture has announced it will be spending 38 million dollars on a preventative sugar bailout, thanks to information gathered by the Star Tribune.
The government logic behind the USDA’s plan to spend 38 million dollars in the sugar market has been shared with the individuals, families, and businesses whose money will be used, because that’s the level of transparency the Obama administration promises to deliver when it steals your money for something it needs.
The Department of Agriculture announced that it will implement an estimated 38 million dollar minor bailout in sugar purchases to ”forestall a larger bailout” that could range between 100 and 300 million dollars if farmers default on federal loans.
Current federal loans in the program are estimated to be 700 to 800 million dollars, but the government, like normal people and businesses, makes mistakes, and these numbers are just estimates. Although, unlike mistakes made by individuals and businesses that affect those who voluntarily participate and associate, when the government screws up, it screws everyone, because everyone is forced to participate and associate.
By purchasing sugar that the farmers will have to give up at a lower price, the USDA hopes it will artificially create demand & raise sugar prices, allowing farmers in the federal loan program to pay back the loan in money earned from possible sales and purchases at artificially raised sugar prices.
In case some readers are not familiar with government logic, like that of this situation, a common government solution to a government created problem is to actually take the problem and use it as a solution. For example, when it comes to debt, the solution is more debt, or when it comes to war, the solution is more war. Even if the problem isn’t solved by more of the same, it’s a win-win situation for government, meaning a lose-lose for someone else (wonder who that could be). The government benefits by distracting those it harms with the new problems it creates, and by creating dependency in the population with the negative effects of previous legislation and constant barrage of damaging new legislation.
In this specific case, sugar prices are as low as they have been in recent history, and the bankrupt government’s loan program and central planners require participating farmers produce a specific amount of sugar and pay the government a certain amount of the loan. More clearly, the USDA is betting other people’s money that the participating farmer’s debt to the government will be paid back by the government going more into debt with a bailout so that at a future date, the government doesn’t have to go more into debt with a larger bailout because of defaulted loans to indebted farmers.
If it sounds confusing, you’re right on track.
This is a bailout to prevent a bailout, classic keynesian economics that has created artificial booms and very real crashes throughout history. Though the aforementioned article describes the situation as the federal government “supporting sugar prices”, what is really going on is the federal government inflating sugar prices.
With the sugar bailout and the influx of federal fiat dollars into the sugar industry, the federal government will create an artificial demand for sugar, and cause a rise in sugar prices, which the USDA plans farmers will profit from. Of course, the little snippet that is always left out seems to be the discussion on what occurs when artificial demand disappears,can no longer be created, or has tapped out trust.
You may find this government sugar bailout situation familiar, and you would be right if you did. This should remind you of the recent and ongoing situation with the boom and bust cycle that occurred with the housing and financial crisis, and over and over before that, as a result of the Federal Reserve’s “wealth without production” policy, where money is created with no value, without production, and thrown into industries without real market demand.
In the housing crisis, the loaning standards were not just lowered, but artificially lowered to deliver expensive houses and debt to people who couldn’t afford them, and that debt was overvalued and sold to companies who malinvested their money based on skewed and artificial information because of government intervention. And as a result, when the market could take no more, and a correction was due, companies purchasing overvalued debt crashed, and the people who were supposedly being helped, lost their jobs and their homes, and ended up in a worse situation than they were in before. And some of those companies, whom knew exactly what was going on and profited for years, were actually bailed out with the money of the people who had to suffer the consequences of the federal reserve/federal government’s boom and bust economic model.
Whether it’s the big sugar bailout, or the housing bailouts, the value of everyone’s dollars, in savings and in value of property, is devalued when the government creates money out of thin air and based on centrally planned economics, creates artificial demand with it. Not only that, but the very companies that participate in the crisis, at the opportunity and command of Government, get bailed out by the Government (your money + the value of your money) when they fail.
This entire idea that printing fake and valueless money that we don’t have, and adding billions and trillions in debt, to create something that wasn’t there or shouldn’t be there, like the demand for sugar, or a loan to someone who isn’t ready for it, may last for a very short time (the “boom”), but is always followed by a massive bust that leaves the people who were supposed to be helped and the people who didn’t need help in a worse situation.
Then, the politicians attempt to take advantage of the larger percentage of the population that needs help and the newly government-created dependency by creating authority it didn’t have before and repeating the cycle with a larger bailout, like the one the USDA is warning it will implement if this minor sugar bailout does not succeed.
This USDA sugar bailout situation is all too familiar, and like it should have been to bailouts in the past and should be now to avoid familiar economic damage and disaster, the answer is NO MORE BAILOUTS and NO MORE GOVERNMENT INTERVENTION.
You can contact the Department of Agriculture HERE and let them know what you think of their sugar bailout at your expense.
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