{"id":2342,"date":"2020-09-29T03:27:39","date_gmt":"2020-09-29T03:27:39","guid":{"rendered":"http:\/\/shivamsingh.in\/?p=2342"},"modified":"2020-10-02T19:02:06","modified_gmt":"2020-10-02T19:02:06","slug":"farmers-arent-stupid-and-thats-why-theyre-protesting","status":"publish","type":"post","link":"https:\/\/shivamsingh.in\/index.php\/2020\/09\/29\/farmers-arent-stupid-and-thats-why-theyre-protesting\/","title":{"rendered":"Why India&#8217;s Farmers Are Protesting Against the 2020 Farm Bills"},"content":{"rendered":"\n<div>I didn\u2019t think I\u2019d be writing two back to back articles on rural India. This short article, just like the previous one, has nothing to do with politics.<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>If you can understand Hindi (or better yet, Punjabi) watch this and you can skip reading the next three paragraphs. The ones after that are important though.<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>\n<p><\/p><\/div>\n\n\n\n<figure class=\"wp-block-video aligncenter\"><video controls src=\"http:\/\/shivamsingh.in\/wp-content\/uploads\/2020\/09\/Farmers-Bill.mp4\"><\/video><\/figure>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>Video &#8211; Farmer\u2019s concern: These bills allow private companies to buy from farmers at any price. So huge corporates (Reliance Retail and DMart types) shall enter agri-procurement. They\u2019ll build fancy procurement centers and treat farmers very well. Maybe even pay them Rs. 100 &#8211; 150 more than the MSP for their crops! This sounds awesome, doesn\u2019t it?<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>Well it is. For the first 1 &#8211; 2 years. Then just like the telecom giants dying from the Free Jio effect, all of the Adhatias (Traders) in the govt Mandis will vanish. If no one\u2019s selling to them, they won\u2019t keep sitting in the Mandi because they have a family to feed and a profit to make too. So the government Mandi shuts down &#8211; after all, no one\u2019s sold anything to the traders there in two years because MegaCorp pays more and has air conditioned waiting lounges!<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>This is when the fun starts. Traders gone = MSP gone. In the third year you have to sell to MegaCorp at a slightly lower rate, 4th year &#8211; even lower, 5th year &#8211; you\u2019re making half the profit you used to\u2026 it keeps declining till the point that you\u2019re just surviving. Year 10 &#8211; you essentially have zero profits. The other traders have been gone for 10 years now, they aren\u2019t coming back to save you. You protest every year for MSP, but you also have to sell because you have a family to feed (India ain\u2019t got no farmers who can just store their produce and not sell!)<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>Bonus point, that might just happen: Since all the procurement is done by MegaCorp and maybe a MegaCorp 2 &amp; 3, their oligarchy now controls all the supply too. This means only one thing &#8211; increased prices for the consumer! The rate they set for wholesale is the rate the local Kirana (Grocery Store) has to buy at too. Not like your neighborhood shopkeeper will take a truck directly to a Punjab farmer and buy a truck full of rice to sell to you at a rate less than MegaCorp.<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>Bonus point 2, and this is just me saying it: After seeing the operation of MSP in Bihar for a few years now, I guarantee it won\u2019t even be as civil as MegaCorp just competing out the Mandi Traders. They\u2019ll literally pay Mandi officials Lakhs to sit at home and not buy from farmers at MSP. Official gets suspended for not buying, he gets a bonus bag of cash from MegaCorp. It\u2019s a very well tested model.<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>Now this is the part where I\u2019ve truly felt some outrage. Too many city folks who\u2019re comfortably working in AC offices think the bills are great. They believe the farmers will have more choices and free markets are the awesomest!<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>Here\u2019s a shocker: It\u2019s not like farmers aren\u2019t trying to make money! And they aren\u2019t even stupid. There\u2019s a reason they barely survive after months of toiling\u2026<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>It\u2019s literally that agriculture has TOO many producers with ZERO pricing power. MSP is literally the only thing preventing a pricing collapse. We live in an excess food world, so in a true free market the price of produce will be much lower than MSP (and it is in states where the govt just doesn\u2019t buy at MSP, read &#8211; Bihar.)<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>Economics 101: In a free market, equilibrium comes about because producers exit the market when prices become unprofitable. And as the supply declines because of producers exiting, the prices rise to the equilibrium point.<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>In the case of agriculture, there are A LOT of extra producers (the farmers). What exactly are the free agriculture market proponents proposing we do with the extra (surplus) farmers? We have some cushy office jobs lined up for them, right?<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>The End, mostly.<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>PS: The agriculture procurement system needs to change. I\u2019ve been an advocate of it for years and I hate the APMC Act as vehemently as I presume I\u2019d hate getting hit by a bus. The current bills are terrible though, and the farmers will certainly pay a price. In all likelihood, you as a consumer would too. Please feel free to disagree with everything, but at least put in some efforts at understanding why farmers are protesting (it\u2019s not because they hate our glorious leader).<\/div>\n\n\n\n<div>&nbsp;<\/div>\n\n\n\n<div>Share the message if you can. Feel free to copy, paste, republish. Credit would be nice but isn\u2019t a requirement. Treat this post as your own!<\/div>\n\n\n\n<div>\n<p>Also, a quick video explainer of Equilibrium Pricing in case you&#8217;re interested in the economics of it all: <a href=\"https:\/\/www.youtube.com\/watch?v=7eZcPs9z9OA\">https:\/\/www.youtube.com\/watch?v=7eZcPs9z9OA<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>I didn\u2019t think I\u2019d be writing two back to back articles on rural India. This short article, just like the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":2344,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0},"categories":[200,216],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Why India&#039;s Farmers Are Protesting Against the 2020 Farm Bills - Shivam Shankar Singh | Author, Data Analyst and Campaign Consultant<\/title>\n<meta name=\"description\" content=\"Shivam Shankar Singh Author Data Analyst How to Win an Indian Election Schwarzman Scholar Michigan LAMP Fellow Art of Conjuring Alternate Realities Penguin HarperCollins Information Warfare\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/shivamsingh.in\/index.php\/2020\/09\/29\/farmers-arent-stupid-and-thats-why-theyre-protesting\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Why India&#039;s Farmers Are Protesting Against the 2020 Farm Bills - 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