> Del Monte went out of business because there wasn't enough demand for the peaches.
Things are often more complicated than that. Del Monte was founded a long time ago and fruit trees take a long time to grow. As a result, as the originator of those trees, you're at a disadvantage because you have to pay for many years of maintenance and interest on capital before the trees bear fruit, and are then sitting on a load of debt from the unproductive years that you can't service if the market price is low after the trees are producing.
But bankruptcy (or new ownership) clears the old debt, and then you're left with a productive asset that might not have been worth the cost to create at current prices, but could easily be worth the cost to continue using now that growing the trees is a sunk cost, which requires a much lower market price to be sustainable.
> In the article you can even see that the farm lobby was so powerful that they got the USDA to pay for the tree removal.
That sounds a lot like a cartel acting through regulatory capture to limit supply.
Like if destroying the trees to grow something else was more profitable than continuing to sell the produce then why does it require a government subsidy?
> Like if destroying the trees to grow something else was more profitable than continuing to sell the produce then why does it require a government subsidy?
Because why pay for something when you can get someone else to pay for it?
"The industry has captured the government and is doing a corruption" is the thing consistent with the theory. The non-corruption/capture reason for the government to pay for it is supposed to be what?
An ideal solution, but not what is happening.
It seems like all you're doing is agreeing that there is no plausible non-corrupt reason to do that.
The problem is not that the government is helping the problem is that private capital is getting the benefits instead of all the citizens. I think Americans have after decades of propaganda are stuck with government bad narrative as both parties are captured by capitalist that won't allow the their bought politicians to do anything for citizens. Mamdani in NY will be an interesting case study in the future.
> The problem is not that the government is helping the problem is that private capital is getting the benefits instead of all the citizens.
The government is giving them money -- to do something stupid. There is no apparent non-corrupt reason to do that. It wouldn't be better if the government was also offering ordinary people cash money to destroy productive fruit trees.
Whereas if the government was to help "all of the citizens" then they would all be getting the money and not have to do something stupid in order to get it. But the thing that looks like is either just lowering their taxes to begin with, or doing a UBI if the point of it is redistribution. In neither case is paying anyone to do economically inefficient nonsense a good policy.
> Like if destroying the trees to grow something else was more profitable than continuing to sell the produce then why does it require a government subsidy?
Del Monte didn’t grow peaches, they contracted with farmers (long term, 20 year contracts) who grew peaches and then Del Monte canned the peaches. Del Monte was purchased with an LBO that loaded their books with debt.
Del Monte blew up and left farmers holding the bag. Paying the farmers to convert their land to grow something else prevents fire sales of the existing land.
Considering the market that Del Monte made for canned peaches, someone was going to grow peaches for them. The farmers may have mismanaged their risk, but I’m fine with compensating farmers that end up with worthless trees because of a leveraged buyout. If these farmers were forced to sell their land, some giant ag business would end up with the land.
> Paying the farmers to convert their land to grow something else prevents fire sales of the existing land.
There is no fire sale of land. There is enormous demand for land, especially productive agricultural land which is essentially traded as a fungible commodity.
> The farmers may have mismanaged their risk, but I’m fine with compensating farmers that end up with worthless trees because of a leveraged buyout.
Even then, why are you paying them to destroy productive trees instead of e.g. buying their peaches and donating them to food pantries or stocking the cafeterias at government facilities?
> If these farmers were forced to sell their land, some giant ag business would end up with the land.
That's just cynical speculation. If they sell the land it goes to anyone who wants to buy it. You're also assuming that the ones getting the money aren't already some giant ag business.