How does our government subsidize our agriculture?

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    Over 90% of government subsidies go towards producers of wheat, corn, soybeans, rice, or cotton. The dollar amount of the subsidy depends on things like market prices and disasters that affect crop production.

    There are overall 8 types of subsidies that can be given out:

    • direct payments – based on the farm’s history of the farm’s acre usage for production
    • marketing loans – government will pay the minimum price for crops to sustain the farm, so even if crop prices drop dramatically, the farm will survive; this also stimulates excess production
    • countercyclical payments – the lower the market price, the larger the subsidy; pretty much the same as marketing loans, but based on the historical production of the farm
    • conservation subsidies – farms paid to cultivate land by using ground covers like grass or trees; these can be used on retired acres and will help restore the land
    • insurance – protects farmers against risks of weather, pests, and low market pricing
    • disaster aid
    • export subsidies – supports international advertising campaigns
    • agricultural research and statistics – government gives money to farmers for their research
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