One thing that annoys me about the rise of agrocorp is how the deck is stacked against existing farmers.
We know that tiered taxation systems are generally a good thing, where individuals who earn more pay progressively higher percentages in tax. They still take home more money overall by earning more, but it shifts the burden of income tax away from those who have the least.
This doesn't happen for corporations. The mom and pop farm managing 2 hectares is paying the same tax rate as HappyValleyAgroCorp which manages 100000 hectares spread across the country.
But it gets worse. Mom and pop either have old inefficient equipment they've inherited, or have to rent in equipment when needed, cause they can't afford to drop $500k on a new tractor that will get used for 50 days a year. So they're paying more for their equipment than HappyValleyAgroCorp which has their own fleet of gear that's in constant use.
Mom and pop are stuck paying whatever price the local farmer supply store charges for feed and fertiliser. HappyValleyAgroCorp is buying so much that they can negotiate heavily with suppliers and ship stuff in from across the country.
Mom and pop will struggle to access any subsidies that might be available, either having to jump through hoops or simply not knowing about them. HappyValleyAgroCorp's got a lawyer on retainer who goes golfing with the subsidy administrator.
Mom and pop are stuck taking whatever price HappyValleyGroceryCorp offers them for their produce. HappyValleyAgroCorp is pumping out so much produce for cheaper costs that they can undercut mom and pop into the ground, and negotiate higher wholesale rates by threatening to disrupt HappyValleyGroceryCorp's supply chains. But they hash it out over their weekly golf round, and the only ones that get hurt are mom and pop and us buying groceries.
And so mom and pop are stuck working for very little their entire lives, until they die, and their kids are left with a tiny farm that brings in very little, and forced to choose between slaving away like mom and pop did, or sell off the land to HappyValleyAgroCorp who's willing to step in with "quite a reasonable offer really for this tiny plot, in cash, cause we know in this difficult time you don't want to be wasting time dealing with this. It's what mom and pop would have wanted, that the land continues to be farmed."
And 40 years later, we still think of farmers as mom and pop but really it's 3 or 4 mega corps owning the entire thing.
sweetpotatokumquat t1_jaby1pl wrote
Reply to comment by EquivalentCommon5 in ELI5: Why is it that when fertilizers make their way into waterways, all the oxygen disappears, killing the fish? by Psychological-Dog994
One thing that annoys me about the rise of agrocorp is how the deck is stacked against existing farmers.
We know that tiered taxation systems are generally a good thing, where individuals who earn more pay progressively higher percentages in tax. They still take home more money overall by earning more, but it shifts the burden of income tax away from those who have the least.
This doesn't happen for corporations. The mom and pop farm managing 2 hectares is paying the same tax rate as HappyValleyAgroCorp which manages 100000 hectares spread across the country.
But it gets worse. Mom and pop either have old inefficient equipment they've inherited, or have to rent in equipment when needed, cause they can't afford to drop $500k on a new tractor that will get used for 50 days a year. So they're paying more for their equipment than HappyValleyAgroCorp which has their own fleet of gear that's in constant use.
Mom and pop are stuck paying whatever price the local farmer supply store charges for feed and fertiliser. HappyValleyAgroCorp is buying so much that they can negotiate heavily with suppliers and ship stuff in from across the country.
Mom and pop will struggle to access any subsidies that might be available, either having to jump through hoops or simply not knowing about them. HappyValleyAgroCorp's got a lawyer on retainer who goes golfing with the subsidy administrator.
Mom and pop are stuck taking whatever price HappyValleyGroceryCorp offers them for their produce. HappyValleyAgroCorp is pumping out so much produce for cheaper costs that they can undercut mom and pop into the ground, and negotiate higher wholesale rates by threatening to disrupt HappyValleyGroceryCorp's supply chains. But they hash it out over their weekly golf round, and the only ones that get hurt are mom and pop and us buying groceries.
And so mom and pop are stuck working for very little their entire lives, until they die, and their kids are left with a tiny farm that brings in very little, and forced to choose between slaving away like mom and pop did, or sell off the land to HappyValleyAgroCorp who's willing to step in with "quite a reasonable offer really for this tiny plot, in cash, cause we know in this difficult time you don't want to be wasting time dealing with this. It's what mom and pop would have wanted, that the land continues to be farmed."
And 40 years later, we still think of farmers as mom and pop but really it's 3 or 4 mega corps owning the entire thing.