Minnesota Farmers Union

(June 19, 2009) - Secretary of Agriculture Vilsack has indicated some skepticism about the creation of a grain reserve, although it is difficult to know just what he was referring to when, at the G-8 meeting in Italy, he told Reuters writer Jeremy Smith, "Our recent experience with that concept was that in theory, [a grain reserve] sounds like a terrific idea but in practice it was very difficult. What we saw was that it really didn't create the kind of stability in pricing that people thought it would"
(http://af.reuters.com/article/investingNews/idAFJOE53I02N20090419?sp=true).

In this column we want to take a look at the liabilities and benefits of a properly managed stock-holding program from the perspective of the US taxpayer. In the absence of any clarification by the Secretary and assuming the administration would manage such a program in good faith, let us look at some of the most common criticisms that have been made of grain storage programs and the implications for taxpayers.