Farmers participating in the subsidize program are told how many acres they can plant. That's where the old saw about getting paid not to grow corn comes from.
It appears they didn't put production limits on dairy products. The subsidize has kept the price of milk products artificially high for a long time. This has encouraged a lot of dairy farmers to increase their herds so they can make more money. As a result, the federal government buys a lot of surplus milk (typically in the form of powdered milk) and stores it. I saw a news article just the other day saying we're spending millions each year to store over a billion pounds of powdered milk.
There are other programs out there that artificially restrict the market, such as restrictions on imported sugar or on who is allowed to grow peanuts. In the end, the farm subsidizies hurt consumers in two ways. First, they cost billions of tax dollars each year. Second, they artifically drive up the price of many food products. In the end, the consumer is left with higher taxes and grocery bills.
Current Events » in reply to Farming is extreemly capital intensive.
That's why the farm subsidizies often have production limits or other restrictions
