Thai rice politics and the future of agricultural subsidies

[rooster59]

Thai rice politics and the future of agricultural subsidies

By Titipol Phakdeewanich  
Special to The Nation

 

Each wet season, Thai farmers begin cultivating their annual crop anticipating both natural and market uncertainties. For these farmers, nothing can be taken for granted.

 

Last year excessive rain destroyed much of their crop, this year too little or too much water could do the same. Nevertheless, the uncertainties confronting Thai farmers are typical of the problems farmers face worldwide, thus subsidies remain crucial for the survival of farmers. 

 

The previous Yingluck administration implemented one of the most controversial and expensive farming subsidy policies in Thai history, allegedly costing the state more than Bt500 billion. Her rice-pledging policy was criticised for a lack of substance to help farmers survive in the capitalist market, instead simply putting cash in their hands. 

 

Yingluck’s rice policy has also been fiercely criticised by her political opponents for destroying market mechanisms, and perhaps violating Thailand’s world trade commitments. In a 2013 meeting of the WTO Agriculture Committee, Canada, the US, Australia and the EU questioned whether Thailand had breached its domestic support limits.

 

Although, 86.5 per cent of farmers were reportedly satisfied with the policy, the rice-pledging scheme was politicised and became one of the main contributing factors to Yingluck’s ouster by military coup in 2014, resulting in allegations against her of corruption and charges she neglected her duty to oversee the scheme. 

 

The Supreme Court rules on August 25, and a guilty verdict would have serious ramifications for the political futures of Yingluck and her Pheu Thai Party, as well as for the ongoing Thai political conflict. But it would also indicate the future prospects of farm subsidies in Thailand.

 

That there was corruption in the implementation of rice-pledging is undeniable, and rigorous law enforcement is required to handle the case. Indeed, corruption was also observed during the implementation of the rice price-guarantee policy under her predecessor, Abhisit Vejjajiva.

 

In addition, a number of corruption allegations made against rice-pledging were targeted not at its implementation, but at pre-existing problems in the Thai rice industry, one example being the rigging of scales to measure moisture in farmers’ paddy in the rice mills. It is crucial to scrutinise all stakeholders involved, rather than primarily focusing on politicians. 

 

The public is now questioning whether Thailand should maintain such policies to support rice farmers. Is there any future prospect for rice subsidies?

“I cannot survive with the money from selling rice, now. I used to make just enough money from the [rice-pledging] policy. You don’t understand why it [the subsidy] is important, because you are not a farmer. I still hope this [Prayut] government restores the rice-pledging policy to help us. I borrowed money to buy lots of things for farming,” stated a rice farmer in Si Sa Ket province.

 

Thai farmers have always received sympathy for their hard work from the urban-middle class, and they have been regarded as the backbone of the nation for centuries. Nevertheless, public sympathy doesn’t necessary translated into support for rice subsidies, especially since the rural populace has been stereotyped as easily falling into debt and expecting to be rescued by the government. The urban-middle class respect is often based on an idealised and romanticised vision of rice farming that fails to reflect the financial vulnerability.

 

Indeed, the very high price of rice during the Yingluck government was a double-edged sword. Not only did it help provide household liquidity for rice farmers, but it also encouraged farmers to increase their production in order to increase their household income, resulting in oversupply of rice to the market. Rural farmers are typically attracted by economically viable crops, so it is logical that they would seek to maximise their potential profit.

 

Of course, farm subsidies must not be treated as a form of entitlement, especially in the form of cash payments. Subsidies should be provided as a form of relief programme, which can financially support farmers to be able to compete in the market in the long run. 

 

The military government and its supporters are not entirely convinced of the need for rice subsidies and their importance for the growth of the Thai economy. Indeed, few Thais are aware of the historic contribution rice farmers have made to the economy, since this rarely features in the history books. 

 

Between 1950s and 1970s, the “rice premium” (export tax) was a crucial source of government revenue, used to boost the country’s industrialisation. In 1953, government revenue from rice was 32 per cent of the total revenue. This missing piece of information prevents new generations from appreciating the transfer of public resources to subsidise the Thai agricultural sector today.

 

Rice and agricultural subsidies are often dismissed as populist policy, motivated by politicians’ desire to win elections. A vast majority of Thais still believe that subsidies represent a wasteful use of public resources. 

 

They are correct to an extent, but not entirely. At the very least, farmers have to produce crops in order to obtain support from the government, so there is no such thing as a free lunch for rice farmers. In addition, working in a rice field is not a dream career for any Thai youngster, even those doing degrees in agriculture. Therefore, rice subsidies can also be utilised as a long-term national strategy that secures our ability as a nation to feed ourselves.

 

Titipol Phakdeewanich is dean of the Faculty of Political Science at Ubon Ratchathani University, and a visiting fellow at the Centre for the Study of Globalisation and Regionalisation at the University of Warwick in England.

 

Source: http://www.nationmultimedia.com/detail/opinion/30322123

 

 

-- © Copyright The Nation 2017-07-29

[Cadbury]

Thailand once one of the largest rice producers in the world is progressively slipping down the production ladder to now be in 5th place. The next downward move will be to 7th place.

Other countries are using more modern growing and harvesting techniques and producing more at less cost. In the meantime Thai military administrators scratch around like old chooks constantly talking amongst themselves about rice subsidies.

The military don't know anything about rice and nor should they but they like to think of themselves as experts; as they do with everything else.

Like a lot of things in Thailand such as education, democracy and road safety rice production looks like being included in the basket of failures. 

[robblok]

6 minutes ago, Cadbury said:

Thailand once one of the largest rice producers in the world is progressively slipping down the production ladder to now be in 5th place. The next downward move will be to 7th place.

Other countries are using more modern growing and harvesting techniques and producing more at less cost. In the meantime Thai military administrators scratch around like old chooks constantly talking amongst themselves about rice subsidies.

The military don't know anything about rice and nor should they but they like to think of themselves as experts; as they do with everything else.

Like a lot of things in Thailand such as education, democracy and road safety rice production looks like being included in the basket of failures. 

That is the problem, the rice farmers in Thailand are unwilling to change and if you just keep giving them handouts without making changes nothing will ever change. I am all for helping the rice farmer to evolve and change.. but not for never ending handouts. You don't do that with other companies why with rice farmers.. only because they are a big voting block. 

[Cadbury]

Just now, robblok said:

That is the problem, the rice farmers in Thailand are unwilling to change and if you just keep giving them handouts without making changes nothing will ever change. I am all for helping the rice farmer to evolve and change.. but not for never ending handouts. You don't do that with other companies why with rice farmers.. only because they are a big voting block. 

Other countries are changing their rice growing practices and are showing reward for their effort. I don't think corrupt middlemen help the situation in Thailand.

As you say "the rice farmers in Thailand are unwilling to change " and thein lies the problem. Much easier to sit back and demand a subsidy. Problem for them is that potential rice subsidy money is now being sucked up by the generals buying military hardware to keep their egos intact. 

[robblok]

Just now, Cadbury said:

Other countries are changing their rice growing practices and are showing reward for their effort. I don't think corrupt middlemen help the situation in Thailand.

As you say "the rice farmers in Thailand are unwilling to change " and thein lies the problem. Much easier to sit back and demand a subsidy. Problem for them is that potential rice subsidy money is now being sucked up by the generals buying military hardware to keep their egos intact. 

The extra spending on military hardware is a problem, but it did not reach the money wasted on the failing rice scam YL started. Both are totally wrong. In other countries they use subsidies to change things.. not to keep them the same. The longer Thailand stays the same farming wise the more they lose how competitive they are and the more wasteful subsidies have to be pumped in to keep the farmers afloat. 

 

Other countries will produce more and at a lower price.. prices will go down.. here nothing will change so more subsidies are needed to combat the falling prices. That is the problem of giving out money without any demand for change. 

 

I am against the wasting of money on rice subsidies this way, and of course I am against the increasing (in a percentage of the GDP) of the army budget. Both are wrong. Because who is paying it all.. the middle class.  Not the rich.

[billd766]

14 minutes ago, Cadbury said:

Thailand once one of the largest rice producers in the world is progressively slipping down the production ladder to now be in 5th place. The next downward move will be to 7th place.

Other countries are using more modern growing and harvesting techniques and producing more at less cost. In the meantime Thai military administrators scratch around like old chooks constantly talking amongst themselves about rice subsidies.

The military don't know anything about rice and nor should they but they like to think of themselves as experts; as they do with everything else.

Like a lot of things in Thailand such as education, democracy and road safety rice production looks like being included in the basket of failures. 

 

I agree with the early part of your post but not with this part.

 

Quote "

In the meantime Thai military administrators scratch around like old chooks constantly talking amongst themselves about rice subsidies.

The military don't know anything about rice and nor should they but they like to think of themselves as experts; as they do with everything else."

 

The previous government like many before them knew little about rice and used it as a vote getter.

 

IMHO the best thing that ANY government can do is to register EVERY rice grower in the country and grade them into types.

 

1.   Those who don't own but rent the rice fields.

2.   Those who own the farm and land but only grow for themsleves and not for sale.

3   Those who own the farm and land and sell on the marketplace.

 

You can further divide #3 into

1.   Less than 10 rai.

2.   11 to 25 rai.

3.   26 to 50 rai.

4.   51 to 100 rai.

5.Over 100 rai.

 

Then on a sliding scale with the most of a subsidy to those with the least you take the average market price over the last 3, 4 or 5 years and pay cash of say 100% of the difference between the average and the current market price to #1, 50% to #2, 25% to #3, 10% to #4 and 0% to #5.

 

You would need teams to check up on the transactions consisting of someone from the Min of AG, Min of Finance, the province, amphur, moo ban and at least 2 local rice farmers for balance.

 

The money should be directly paid into the farmers bank and NOT in cash.

 

For those farmers who want to learn new methods and skills the government should run training courses locally and provincially, assist in the purchase of new equipment, perhaps a central point where the equipment can be hired complete with experienced crews.

 

For every farmer willing to learn new ways perhaps they should be subsididied by perhaps 2,000 baht per rai for a maximum of 5 years.

 

That is my suggestion.

 

Do you have a different or a better one instead of carping on about the government all the time?

[Cadbury]

Lets agree to agree that neither the Thai military or the previous government knew anything about rice growing and marketing.

Your suggestions have merit but I think might be a bit complex for the simple militaristic minds of those in charge.

Much easier to think about tanks and submarines and planes while dreaming about HS trains.

[plachon]

2 hours ago, Cadbury said:

Thailand once one of the largest rice producers in the world is progressively slipping down the production ladder to now be in 5th place. The next downward move will be to 7th place.

Other countries are using more modern growing and harvesting techniques and producing more at less cost. In the meantime Thai military administrators scratch around like old chooks constantly talking amongst themselves about rice subsidies.

The military don't know anything about rice and nor should they but they like to think of themselves as experts; as they do with everything else.

Like a lot of things in Thailand such as education, democracy and road safety rice production looks like being included in the basket of failures. 

In my view, Thailand not being the No 1 rice exporter in the world and slipping down the table is no bad thing, and there is no rule anywhere that says a country that was once the top producer of a crop or product, should remain that way forever. The world and society isn't like that. Priorities change as society changes and it is probably time Thailand moved on from this fixation with rice and paying subsidies to farmers, big and small, to grow a crop that in many cases has been thrashed to death in less than suitable environments, leaving an impoverished ecological landscape and farmers tied to producing a single crop (not very well or efficiently) behind, who are then tied to a structure of debt, dependency, patronage politics, corruption in the bureaucracy and narrow-minded planning behind.

 

A lot of the land currently growing rice, would be better suited to other crops or just de-intensifying from 3 crops to 2 and double cropping back to a single rainy season crop, with fallowing and livestock grazing in between. Trying to stay in the top 3 of rice exporters is a fool's game, especially with the global price of rice being so low, with other nations destroying their own environments to compete at the top. Knowing when to bow out of a high-stakes game of cards, when you are still marginally ahead, is the crucial decision that Thailand must make the right call on or suffer the consequences. The fixation with rice is largely cultural and ideological, not rational, as the article hints at. 

[Muhendis]

All the grand theories about military intervention or nonintervention being the cause of Thailand slipping from first place to fifth are a bit far from the facts. Thailand has slipped down the production ladder because many Thai farmers have stopped growing rice and have changed over to the more lucrative sugar cane. That might change after November when the govt. stops propping up the sugar cane market.

[halloween]

2 hours ago, Cadbury said:

Lets agree to agree that neither the Thai military or the previous government knew anything about rice growing and marketing.

Your suggestions have merit but I think might be a bit complex for the simple militaristic minds of those in charge.

Much easier to think about tanks and submarines and planes while dreaming about HS trains.

It seems to be you with the fixation. What difference does military spending make to subsidies that shouldn't be paid if you want the rice industry to be both productive and competitive?

[Cadbury]

9 minutes ago, halloween said:

It seems to be you with the fixation. What difference does military spending make to subsidies that shouldn't be paid if you want the rice industry to be both productive and competitive?

"It seems to be you with the fixation". Explain yourself what fixation I might have. Please try and do it without your usual ill- mannered wisecracks.

It should be as plain as the nose on your pumpkin face. Gazillions of baht spent on military hardware = less money for subsidies for any agricultural produce and more importantly less money for things like education, road safety and the like.

Mr Pumpkin should put on his reading glasses. I didn't say that subsidies should be paid. I happen to agree with Robblok who said "rice farmers in Thailand are unwilling to change". Subsidies won't make them change.

[halloween]

2 minutes ago, Cadbury said:

"It seems to be you with the fixation". Explain yourself what fixation I might have. Please try and do it without your usual ill- mannered wisecracks.

It should be as plain as the nose on your pumpkin face. Gazillions of baht spent on military hardware = less money for subsidies for any agricultural produce and more importantly less money for things like education, road safety and the like.

Mr Pumpkin should put on his reading glasses. I didn't say that subsidies should be paid. I happen to agree with Robblok who said "rice farmers in Thailand are unwilling to change". Subsidies won't make them change.

Exactly. you continuously prattle about military expenditure and generals' egos reducing the available for subsidies while agreeing they shouldn't be paid. Why?

[greenchair]

4 hours ago, robblok said:

That is the problem, the rice farmers in Thailand are unwilling to change and if you just keep giving them handouts without making changes nothing will ever change. I am all for helping the rice farmer to evolve and change.. but not for never ending handouts. You don't do that with other companies why with rice farmers.. only because they are a big voting block. 

I guess you can apply that to the rubber farmers. of course they are not receiving financial subsidies, instead government agencies, including the ministry of education have been ordered to purchase large quantities of rubber. The army is spending in the 1 billion  (estimate)to buy rubber mattresses and rubber grass. It's still a pig dressed up. 

If the farmers stop producing rice and rubber, those products will need to be imported. The cost would effect everyone rich and poor. So go ahead. stop the subsidies. 

[halloween]

10 minutes ago, greenchair said:

I guess you can apply that to the rubber farmers. of course they are not receiving financial subsidies, instead government agencies, including the ministry of education have been ordered to purchase large quantities of rubber. The army is spending in the 1 billion  (estimate)to buy rubber mattresses and rubber grass. It's still a pig dressed up. 

If the farmers stop producing rice and rubber, those products will need to be imported. The cost would effect everyone rich and poor. So go ahead. stop the subsidies. 

In between black and white there are shades of grey. If the subsidies were stopped, and half the farmers sold their land to more efficient farmers, combined with economies of scale, you may even end up with efficient industries. Without importation. Is that too complicated for you?

[robblok]

15 minutes ago, greenchair said:

I guess you can apply that to the rubber farmers. of course they are not receiving financial subsidies, instead government agencies, including the ministry of education have been ordered to purchase large quantities of rubber. The army is spending in the 1 billion  (estimate)to buy rubber mattresses and rubber grass. It's still a pig dressed up. 

If the farmers stop producing rice and rubber, those products will need to be imported. The cost would effect everyone rich and poor. So go ahead. stop the subsidies. 

You should look up my posts about rubber farmers..same deal.. no subsidies.

 

They need to change.. combine.. it will get more efficient then. Your obviously ok with spending money on a failing system. I am not, you should only help people to change and make sure they can make their own money. If you make people dependent on handouts it will never end well. The rice price will be falling or staying low while costs here go up.. making them need more and more.. it can't be done.. same goes for rubber, either change become economical (with the governments money) or give up.

 

Not endless handouts, maybe you like them dependent on handouts so they can sell their vote to whoever offers the most handouts ? 

[Srikcir]

7 minutes ago, halloween said:

If the subsidies were stopped, and half the farmers sold their land to more efficient farmers, combined with economies of scale, you may even end up with efficient industries.

This is the ultimate solution and done in countries such as Japan and the USA. Consolidate many small and unprofitable farms sold to large, automated farms taking advantage of economy of scale to achieve profitability. Pay some interim one-time welfare subsidy to the small farmers to make the transition into nonagricultural employment/-SME's. Same should be done for rubber farmers as well.

 

Unfortunately, the traditional power structure of Thai society discourages empowerment of the low-income and poverty classes that might otherwise make demands for power sharing. So the trickle down of government subsidy welfare will remain to keep the low-income and poverty classes in their "place" until a more enlightened (aka democratic) society can develop.

[halloween]

8 minutes ago, Srikcir said:

This is the ultimate solution and done in countries such as Japan and the USA. Consolidate many small and unprofitable farms sold to large, automated farms taking advantage of economy of scale to achieve profitability. Pay some interim one-time welfare subsidy to the small farmers to make the transition into nonagricultural employment/-SME's. Same should be done for rubber farmers as well.

 

Unfortunately, the traditional power structure of Thai society discourages empowerment of the low-income and poverty classes that might otherwise make demands for power sharing. So the trickle down of government subsidy welfare will remain to keep the low-income and poverty classes in their "place" until a more enlightened (aka democratic) society can develop.

Are you saying that the governments that bought their votes with subsidies WEREN'T democratic?

[YetAnother]

income and wealth divides increase; ominous; govts here do not want farmers to thrive; they need sheep

[Eric Loh]

Age old debate but in the context of Thailand, I doubt any sitting government will have the political courage to wean of rice subsidies. It will have to wean of all agriculture crop subsidies to avoid an implosion for fairness. That will mean 2/3 of the working population and related industries. That would wreck havoc to the employment and subsequently to the economy. Rice export supremacy is a source of pride and embedded in the genes of all government. 

 

All our major rice producing countries have massive subsidies. India and China subsidies are said to be almost 30B USD. Vietnam too subsidies their rice farmers . Their farmers will continue to produce large amount as they have little worries due to the subsidies. If Thailand do not subsidies, there will be less incentives to produce and we will lose the export race and no government would like that position. 

 

I guess the best situation will be for Thailand to have a better subsidy plan while the government provide better overall structural plan like training, developing a more efficient distribution mechanism, better fiscal direct policies and improve the inequality of income. Put more money in developing the N and NE so the farmers have another employment potential. Bottom line, to wean of subsidies like New Zealand is quite impossible for Thailand. 

[halloween]

23 minutes ago, Eric Loh said:

Age old debate but in the context of Thailand, I doubt any sitting government will have the political courage to wean of rice subsidies. It will have to wean of all agriculture crop subsidies to avoid an implosion for fairness. That will mean 2/3 of the working population and related industries. That would wreck havoc to the employment and subsequently to the economy. Rice export supremacy is a source of pride and embedded in the genes of all government. 

 

All our major rice producing countries have massive subsidies. India and China subsidies are said to be almost 30B USD. Vietnam too subsidies their rice farmers . Their farmers will continue to produce large amount as they have little worries due to the subsidies. If Thailand do not subsidies, there will be less incentives to produce and we will lose the export race and no government would like that position. 

 

I guess the best situation will be for Thailand to have a better subsidy plan while the government provide better overall structural plan like training, developing a more efficient distribution mechanism, better fiscal direct policies and improve the inequality of income. Put more money in developing the N and NE so the farmers have another employment potential. Bottom line, to wean of subsidies like New Zealand is quite impossible for Thailand. 

"......we will lose the export race and no government would like that position. "

 

Why should a government be worried about losing a race to export a low value, low profit commodity? Yingluk certainly wasn't concerned. In fact, she was quite happy to sell most of the countries rice through an "agent" whose principal is now in jail ( http://af.reuters.com/article/commodities07News/idAFL4N0P60X720140625) and whose companies are having their assets seized. https://www.pressreader.com/thailand/bangkok-post/20170518/281595240463101

[Cadbury]

3 hours ago, halloween said:

Exactly. you continuously prattle about military expenditure and generals' egos reducing the available for subsidies while agreeing they shouldn't be paid. Why?

Shouldn't be too hard  for a pumpkin head like you to figure that out. Why is does it take you so long? I think I know.

[Eric Loh]

2 minutes ago, halloween said:

"......we will lose the export race and no government would like that position. "

 

Why should a government be worried about losing a race to export a low value, low profit commodity? Yingluk certainly wasn't concerned. In fact, she was quite happy to sell most of the countries rice through an "agent" whose principal is now in jail ( http://af.reuters.com/article/commodities07News/idAFL4N0P60X720140625) and whose companies are having their assets seized. https://www.pressreader.com/thailand/bangkok-post/20170518/281595240463101

Your mean mood and silly comment continue. Stop taking my post out of context and inject those idiosyncratic snipe at Yingluck. It has nothing to do with my post. Grow up. 

[halloween]

1 minute ago, Eric Loh said:

Your mean mood and silly comment continue. Stop taking my post out of context and inject those idiosyncratic snipe at Yingluck. It has nothing to do with my post. Grow up. 

Actually it was a direct quote as to why subsidies have to be continued, based on an illogical argument that "......we will lose the export race and no government would like that position. "

The current and last governments obviously didn't agree, the main purpose of Yingluk's 'subsidy' was vote buying and allowing her brother's corruption to continue.

[Eric Loh]

2 minutes ago, halloween said:

Actually it was a direct quote as to why subsidies have to be continued, based on an illogical argument that "......we will lose the export race and no government would like that position. "

The current and last governments obviously didn't agree, the main purpose of Yingluk's 'subsidy' was vote buying and allowing her brother's corruption to continue.

As usual you are wrong.,,....again. 

[greenchair]

4 hours ago, robblok said:

You should look up my posts about rubber farmers..same deal.. no subsidies.

 

They need to change.. combine.. it will get more efficient then. Your obviously ok with spending money on a failing system. I am not, you should only help people to change and make sure they can make their own money. If you make people dependent on handouts it will never end well. The rice price will be falling or staying low while costs here go up.. making them need more and more.. it can't be done.. same goes for rubber, either change become economical (with the governments money) or give up.

 

Not endless handouts, maybe you like them dependent on handouts so they can sell their vote to whoever offers the most handouts ? 

I didn't say I agree with the handouts. I'm saying that the present government is no different with support of rubber farmers. 

It's the same thing dressed up to look pretty. 

Still a pig though isn't it. ??

[robblok]

12 minutes ago, greenchair said:

I didn't say I agree with the handouts. I'm saying that the present government is no different with support of rubber farmers. 

It's the same thing dressed up to look pretty. 

Still a pig though isn't it. ??

They have given money to the rice farmers too.. and yes I don't agree with it for either the rubber farmers as the rice farmers. I am ok with HELPING to change or to improve.. not constant propping up of prices. 

 

[billd766]

3 hours ago, Eric Loh said:

Age old debate but in the context of Thailand, I doubt any sitting government will have the political courage to wean of rice subsidies. It will have to wean of all agriculture crop subsidies to avoid an implosion for fairness. That will mean 2/3 of the working population and related industries. That would wreck havoc to the employment and subsequently to the economy. Rice export supremacy is a source of pride and embedded in the genes of all government. 

 

All our major rice producing countries have massive subsidies. India and China subsidies are said to be almost 30B USD. Vietnam too subsidies their rice farmers . Their farmers will continue to produce large amount as they have little worries due to the subsidies. If Thailand do not subsidies, there will be less incentives to produce and we will lose the export race and no government would like that position. 

 

I guess the best situation will be for Thailand to have a better subsidy plan while the government provide better overall structural plan like training, developing a more efficient distribution mechanism, better fiscal direct policies and improve the inequality of income. Put more money in developing the N and NE so the farmers have another employment potential. Bottom line, to wean of subsidies like New Zealand is quite impossible for Thailand. 

 

An interesting and thoughtful post and one that every government and political party should be thinking about now and for the future elections whenever they may be. A policy to think hard about and come up with some good costings,

 

Thank you.

[robblok]

3 hours ago, Eric Loh said:

Age old debate but in the context of Thailand, I doubt any sitting government will have the political courage to wean of rice subsidies. It will have to wean of all agriculture crop subsidies to avoid an implosion for fairness. That will mean 2/3 of the working population and related industries. That would wreck havoc to the employment and subsequently to the economy. Rice export supremacy is a source of pride and embedded in the genes of all government. 

 

All our major rice producing countries have massive subsidies. India and China subsidies are said to be almost 30B USD. Vietnam too subsidies their rice farmers . Their farmers will continue to produce large amount as they have little worries due to the subsidies. If Thailand do not subsidies, there will be less incentives to produce and we will lose the export race and no government would like that position. 

 

I guess the best situation will be for Thailand to have a better subsidy plan while the government provide better overall structural plan like training, developing a more efficient distribution mechanism, better fiscal direct policies and improve the inequality of income. Put more money in developing the N and NE so the farmers have another employment potential. Bottom line, to wean of subsidies like New Zealand is quite impossible for Thailand. 

This, make them more efficient bring the costs down stuff like that. If all those countries have massive subsidies.. then Thailand should not.. at least not how it was done during the rice program. Don't you see its in your own reply. Those countries will produce more and more.. that will drive the rice price down. If you keep paying way above market the difference will be bigger and bigger and it would become too expensive (the rice program was already too expensive). But it would become even more expensive.

 

Cost should be brought down, and people should go for other crops that are viable. You are right you can't retire all the farmers.. but you can make them more efficient and let them go for other crops too. Mass producing rice and competing with other countries will only lead to a lower and lower price. 

 

You are right though.. a government that does not do the normal handouts wont make themselves popular.. and that is what the rice program has caused.. They want money.. but not change. They are set in their ways and used to getting the money. So nothing will change because there is no political will.. and the subsidies will have to get higher and higher till the country can't pay for it anymore. 

[tomta]

A point that a lot of people seem to miss in Titipol's article is that through the rice premium from the 50s to 70s the rice farmers effectively subsidized the rest of the country. Bangkok and surrounds is where the wealth and productive capacity is now and it is there because the rice farmers were squeezed. So it's very annoying when the middle and upper classes in Bangkok (remember the "Respect my Tax" riposted to "Respect my vote" in 2014) catgeorize the rice farmers as being lazy, greedy and entitled.

 

[halloween]

15 minutes ago, tomta said:

A point that a lot of people seem to miss in Titipol's article is that through the rice premium from the 50s to 70s the rice farmers effectively subsidized the rest of the country. Bangkok and surrounds is where the wealth and productive capacity is now and it is there because the rice farmers were squeezed. So it's very annoying when the middle and upper classes in Bangkok (remember the "Respect my Tax" riposted to "Respect my vote" in 2014) catgeorize the rice farmers as being lazy, greedy and entitled.

 

I don't see that as a valid reason to offer support to an industry that is both inefficient and low productivity, unless it is aimed at increasing both efficiency and productivity.