Comments George Naylor has made

supply curve

Mr. Scorcese needs to think independently about the subject of supply curves.  I think economists generally refer to this situation as a backward sloping supply curve.  A farmer's supply curve depends on the cultural and political framework the farmer labors under--ie. expectations.  If the farmer has to try to survive because prices have generally been low, then the farmer surely isn't going to cut back production and may even roll the dice to increase production (backward sloping supply curve).  If prices became very low and there were no backup subsidy system, the farmer would go broke, and so would a lot of others.  But then the land would return to production by other farmers able to buy the assets at a lower value and able to get bigger machinery etc.
If the farmer has been surviving because of subsidies and along comes a new craze--the ethanol boom, then of course the farmer might shift to greed as a motivator and try to increase production to make some quick bucks to make up for all the years of penury.  That's defintely a forward sloping supply curve.  The environment will help pay for the greed and the possible bust when all the farmers around the world respond to the hype of good prices in in the forseable future.  
On the other hand, if there was a policy--that is a transparent policy--of a price support system that raised prices above they supposed freemarket level with a non-recourse loan and supply managment, the farmer might think, "Well, hell, I don't have to destroy my farm to make a living, maybe I'll cut back on production and take a little more time for the family. (Again a backward sloping supply curve.)  If we had a Secretary of Agriculture who could project the farmers and societies interest, he/she would encourage such behavior as good stewards of the land along with family values.  The Secretary would also make it clear that higher corn and oilseed prices (the main ingredients in industrialized livestock feed would result in higher livestock prices, so "All you young farmers out there interested in raising livestock extensively with hay, pasture and small grains, go to it.  We might even allow some of the land in CRP or other soil conserving programs be grazed or hayed for small operations to bring back small family farm livestock production."  
But all the good things that could happen won't happen as long as farmers live under what Secretary Ezra Taft Benson (Eisenhower admin) said farmers needed, "the spur of insecurity" ie. the free market.    
 On Why gutting subsidies shouldn't be the focus of Farm Bill reform efforts posted 2 years ago 17 Responses