5 ms·

Or schemes similar to agriculture where the government buys excess production for price stability. Which is good for consumers and businesses alike.

lesuorac 2y ago
To be clear, "price stability" in this case means a higher price compared to absence of government intervention. I'm all for a country subsidizing food to ensure sufficient domestic production but I am not for pretending it's good for a "price stability" reason. We are also well beyond sufficient domestic production. Our population has doubled in the past 50 years [1] while food production has tripled. We do not need agriculture subsides for sufficient domestic production. [1]: https://www.census.gov/data/tables/time-series/dec/popchange-data-text.html https://www.census.gov/data/tables/time-series/dec/popchange... [2]: https://www.usda.gov/about-usda/news/blog/look-agricultural-productivity-growth-united-states-1948-2017 https://www.usda.gov/about-usda/news/blog/look-agricultural-...
- mschuster91 2y ago
  > I'm all for a country subsidizing food to ensure sufficient domestic production but I am not for pretending it's good for a "price stability" reason. Price stability itself is a valid goal. Yes, consumers may pay a liiiitle more for their eggs, milk or bread, but the price of the good can be relied upon which is very important for low-income households and their financial planning.
  - vanattab 2y ago
    you must not be buying eggs lately
    - mschuster91 2y ago
      I'm European, we don't hold chickens in such absurdly large farms as Americans, my eggs come from the farm next door...
  - roenxi 2y ago
    Are you absolutely sure that low prices wouldn't be more important to low income families? It seems like low prices-low income is a better match than slightly high prices-low income. My understanding of the situation was that low income shoppers are typically extremely keen for a bargain and are quite happy to shop around. And on paper they can just pretend the price is higher than it really is if stability matters that much to their planning.
    - mschuster91 2y ago
      See my reply to another person raising a similar question. Price discounts are a good thing for consumers, but what particularly sucks is over night price hikes for basic staples.
  - KETHERCORTEX 2y ago
    > Yes, consumers may pay a liiiitle more for their eggs, milk or bread > very important for low-income households and their financial planning. Paying more is beneficial for low income households, I see. That looks like expert level mental gymnastics detached from the reality.
    - mschuster91 2y ago
      > That looks like expert level mental gymnastics detached from the reality. Bro, I literally used to be homeless for a while many years ago. Believe me, I know how reality looks like, and there was nothing more frustrating than finding out, whoops, you don't have the 20 fucking cents to buy the groceries you wanted because they decided to raise the price of butter over night. Price reductions are announced in ads all the time, but price hikes? You can only find that out when you are in the store but then it may be too late and you gotta reschedule what you buy at a moment's notice. Grocery prices must be stable and not subject to arbitrary games.
      - roenxi 2y ago
        This is an argument that you felt bad. Is it an argument that you were worse off? Homeless people tend to have a huge stack of problems and how they feel isn't #1 as I understand it. And while I'd expect it to be a reasonable guide I don't trust the instincts of a homeless person to work out what is in their own best interests when those instincts are saying "systemically push the price of food up, that'll help". Frankly, it sounds like a traumatic experience and the response to the trauma would lead to bad policy. I don't want to thoughtlessly minimise feeling bad, but between (having more food), (shelter) and (feeling good), society would be doing better to prioritise in that order when it comes to trying to help. We're talking about a situation where you have 20 cents; a 2% average reduction in the price of butter means you get around 2% more butter and associated calories. If we trade off price increases for higher average prices you'd literally just have had less butter to eat. Those differences will add up over a month, even if sometimes there is a tough shopping trip. If the price stability thing is for poor families there are many better policies than pushing up the average price of food. Like pushing the price of food down, then finding ways to communicate what is cheapest this week. Ie, solving the "You can only find that out when you are in the store" part.
- Animats 2y ago
  > To be clear, "price stability" in this case means a higher price compared to absence of government intervention. Depends on how it works. There are a few different cases. One is for a commodity where increased supply and lower cost does not increase demand much. Rare earths are like that. The cost of the metal is a small part of the cost of the finished product. A drop in rare earth prices will not increase motor sales much. So overproduction from multiple sources will crash the price. This is why commodity prices are so volatile, despite relatively constant supply and demand. A slight imbalance in supply and demand produces huge price changes. Here's the historical price of copper.[1] The price has varied over a 4x range in the last 15 years. 2x in the last 5 years. Futures trading can help stabilize prices, but too much futures trading relative to the actual commodity can increase volatility. [1] https://tradingeconomics.com/commodity/copper https://tradingeconomics.com/commodity/copper
mschuster91 2y ago
> Which is good for consumers and businesses alike. Only for domestic consumers. Foreign consumers? Not so much. A ton of the EU's excess butter and milk products for example ended up being donated to Africa and ruined local agriculture there that couldn't compete with free products. A similar story is playing out in Gaza where there hasn't ever been any incentive to build out domestic production of food because UNRWA brought in a loooot of food aid (which on top of that got looted and commercially re-sold by Hamas). Excess production is vital for any country, but it has to be kept at a moderate level and especially it must not be donated off in a way that threatens domestic production of the good in question.

lesuorac 2y ago

To be clear, "price stability" in this case means a higher price compared to absence of government intervention. I'm all for a country subsidizing food to ensure sufficient domestic production but I am not for pretending it's good for a "price stability" reason. We are also well beyond sufficient domestic production. Our population has doubled in the past 50 years [1] while food production has tripled. We do not need agriculture subsides for sufficient domestic production. [1]: https://www.census.gov/data/tables/time-series/dec/popchange-data-text.html https://www.census.gov/data/tables/time-series/dec/popchange... [2]: https://www.usda.gov/about-usda/news/blog/look-agricultural-productivity-growth-united-states-1948-2017 https://www.usda.gov/about-usda/news/blog/look-agricultural-...

mschuster91 2y ago
> I'm all for a country subsidizing food to ensure sufficient domestic production but I am not for pretending it's good for a "price stability" reason. Price stability itself is a valid goal. Yes, consumers may pay a liiiitle more for their eggs, milk or bread, but the price of the good can be relied upon which is very important for low-income households and their financial planning.
- vanattab 2y ago
  you must not be buying eggs lately
  - mschuster91 2y ago
    I'm European, we don't hold chickens in such absurdly large farms as Americans, my eggs come from the farm next door...
- roenxi 2y ago
  Are you absolutely sure that low prices wouldn't be more important to low income families? It seems like low prices-low income is a better match than slightly high prices-low income. My understanding of the situation was that low income shoppers are typically extremely keen for a bargain and are quite happy to shop around. And on paper they can just pretend the price is higher than it really is if stability matters that much to their planning.
  - mschuster91 2y ago
    See my reply to another person raising a similar question. Price discounts are a good thing for consumers, but what particularly sucks is over night price hikes for basic staples.
- KETHERCORTEX 2y ago
  > Yes, consumers may pay a liiiitle more for their eggs, milk or bread > very important for low-income households and their financial planning. Paying more is beneficial for low income households, I see. That looks like expert level mental gymnastics detached from the reality.
  - mschuster91 2y ago
    > That looks like expert level mental gymnastics detached from the reality. Bro, I literally used to be homeless for a while many years ago. Believe me, I know how reality looks like, and there was nothing more frustrating than finding out, whoops, you don't have the 20 fucking cents to buy the groceries you wanted because they decided to raise the price of butter over night. Price reductions are announced in ads all the time, but price hikes? You can only find that out when you are in the store but then it may be too late and you gotta reschedule what you buy at a moment's notice. Grocery prices must be stable and not subject to arbitrary games.
    - roenxi 2y ago
      This is an argument that you felt bad. Is it an argument that you were worse off? Homeless people tend to have a huge stack of problems and how they feel isn't #1 as I understand it. And while I'd expect it to be a reasonable guide I don't trust the instincts of a homeless person to work out what is in their own best interests when those instincts are saying "systemically push the price of food up, that'll help". Frankly, it sounds like a traumatic experience and the response to the trauma would lead to bad policy. I don't want to thoughtlessly minimise feeling bad, but between (having more food), (shelter) and (feeling good), society would be doing better to prioritise in that order when it comes to trying to help. We're talking about a situation where you have 20 cents; a 2% average reduction in the price of butter means you get around 2% more butter and associated calories. If we trade off price increases for higher average prices you'd literally just have had less butter to eat. Those differences will add up over a month, even if sometimes there is a tough shopping trip. If the price stability thing is for poor families there are many better policies than pushing up the average price of food. Like pushing the price of food down, then finding ways to communicate what is cheapest this week. Ie, solving the "You can only find that out when you are in the store" part.
Animats 2y ago
> To be clear, "price stability" in this case means a higher price compared to absence of government intervention. Depends on how it works. There are a few different cases. One is for a commodity where increased supply and lower cost does not increase demand much. Rare earths are like that. The cost of the metal is a small part of the cost of the finished product. A drop in rare earth prices will not increase motor sales much. So overproduction from multiple sources will crash the price. This is why commodity prices are so volatile, despite relatively constant supply and demand. A slight imbalance in supply and demand produces huge price changes. Here's the historical price of copper.[1] The price has varied over a 4x range in the last 15 years. 2x in the last 5 years. Futures trading can help stabilize prices, but too much futures trading relative to the actual commodity can increase volatility. [1] https://tradingeconomics.com/commodity/copper https://tradingeconomics.com/commodity/copper

mschuster91 2y ago

> Which is good for consumers and businesses alike. Only for domestic consumers. Foreign consumers? Not so much. A ton of the EU's excess butter and milk products for example ended up being donated to Africa and ruined local agriculture there that couldn't compete with free products. A similar story is playing out in Gaza where there hasn't ever been any incentive to build out domestic production of food because UNRWA brought in a loooot of food aid (which on top of that got looted and commercially re-sold by Hamas). Excess production is vital for any country, but it has to be kept at a moderate level and especially it must not be donated off in a way that threatens domestic production of the good in question.