Comment by silisili
6 hours ago
You have to realize the vast majority of farmland is in states suceptable to floods, droughts, hurricanes, pests, frosts, etc. You can read stories of an off year where locusts were so bad they darkened the skies, for example.
Compounding this, farm equipment is freaking expensive. It's not abnormal for a large farm to have hundreds of thousands in payments on machinery. In a good year they make hundreds of thousands. In a bad year they're on the hook for hundreds of thousands. It can take only one bad year to wreck a farm, which is why their suicide rate is so high.
It's hard to imagine as a dev. But imagine you make 200k. Then next year, because of ransomware your boss installed, they tell you you owe 200k through no fault of your own. What would that do to your finances?
Insurance is a parasite. I'm usually against subsidies, but for as something as important as food, it seems reasonable.
You've repeated the part that the parent poster claimed to understand ("I've heard that it's because farming as a business is full of unpredictability"), but skipped over the part they didn't understand ("wouldn't there be a significant market for private insurance?") with the statement that insurance is a parasite.
Can you explain more why insurance is a parasite? Maybe a state-run insurance would be better?
Subsidies (AFAIK, please correct me if I'm wrong) typically either get paid when farming supplies (tractors, seeds, fertilizer, land etc.) are bought or when the final product is sold. So they are paid when things go well for the farmer, but not (or less so) when the farmer has a bad year.
I feel like the risk of bad years would be better managed by paying farmers when bad years happen. You know, like insurance.