Farm states of relatively low population have an outsize influence in the Senate, since every state has two senators. Agricultural subsidies, linked to this political structure, prevent exit of capital and labor from agriculture, when such exit is economically called for by productivity gains. Hence, under the influence of Marxist/socialist/fascist/collectivist/anti-capitalist ideas that both Congress and the Supreme Court approve of, we observe, for example, subsidies for corn in Iowa. We then witness the likes of legislation to add expensive ethanol to gasoline, when Archer Daniels Midland and farmers unite with environmentalists. Another consequence is high fructose corn syrup, and that’s aided (or was aided) by sugar quotas that prevent Americans from buying sugar at lower world prices. The cereal makers and other food companies find that the corn syrup is cheaper, and so they substitute it for sugar.
The effects of political interference in a market are VERY far-flung after awhile. One anti-capitalistic action by the political system creates waves and waves of anti-free market effects due to the interconnectedness of production in our division-of-labor economy. This has been the case in the financial industry which is heavily interfered with by government. It is the case in the business of medicine and drugs. The anti-capitalists among us blame capitalism for all resulting ills, while ignoring the political causes.
The Soviet Union has fallen. Communist China has shifted considerably toward capitalism, but in the U.S. the repudiated ideas of socialism/fascism/ Marxism/collectivism remain in place and continue to be enacted into law.
8:22 am on June 28, 2012
