I think of agriculture as private business. I don't really see why farmers should be given the right to form monopolies and restrict market supply to keep prices high any more than any other industry should.
I view public education, highway infrastructure and police/judicial protection as public goods, not private ones (though highways could certainly be [and many are not free], they tend not to discriminate against particular users or try to restrict the supply of road to keep the price artificially high -- in a way, each road has an element of natural monopoly -- a good reason for them to be publicly controlled).
In essence, a free-market system which prevents the creation of monopolies constitutes (implicitly) the infamous "cheap food policy" that so many discussants object to. Basically, unrestricted competition among many commodity suppliers pushes the price down to (approximately) the cost of production. At lower prices than this and producers start to go out of business -- until supply falls and prices recover; with higher prices, new producers enter production and/or existing producers boost production, with resulting market collapse. In either case, equilibrium would be where consumers get the lowest possible price consonant with the most efficient farmers staying in business. Annual or seasonal supply fluctuations from natural causes can cause flutuations, but, in the long, run, it should work out this way.
This is a fact of life for any producer of a commodity. If you do not have product differentiation or (a more obvious form of) monopoly power, you are bound to be squeezed by competition until only the most efficient survive.
That is the free-market dogma. Of course, the real world doesn't quite operate that way. In addition to politicians dabbling in pretty much every sector (providing subsidies, free advice, cheap resource access, market power, etc.) one major cost of production -- the environmental cost -- has not yet been adequately incorporated into market prices. In fact, a farmer who is more nearly sustainable in his farming practices -- one who, right now, might have somewhat higher per-unit cost of production -- could well lose out in competition with less environmentally-benign neighbours.
Being environmentally-sustainable, but economically bankrupt doesn't do anyone any good. Since I assume that too few farmers will, on their own initiative, adopt earth-friendly farming methods, the Government is the only agency that has the power to alter the structure of rights that will force change in practices and, therefore, incorporation of environmental externalities into product prices.
I prefer to pay the full cost of items I buy rather than be bled continously for tax dollars to repair damages indirectly caused by my consumption. Or, worse still, to have to live with a deteriorating environment because any industry, including agriculture, is allowed to use it as a cesspool or garbage dump to absorb the wastes of their production process for free.
Please forgive the abrupt transition between discussion of monopoly power and environmental externalities. Those were the two main topics of your earlier comment; I don't mean to imply that these are necessarily linked, though.
BOB
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