The Grain Debate- A call to Action
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by Justin Moore
The Grain Industry is of Fire! lets put it out.
To all congressional members
Recently grain company owners and food company owners for that matter as well as several citizens of Israel including myself as a grain company owner have bickered and argued about the low import tax on grain. This decision was made by congress and it is respected.
What do I want?
-The import tax is 5% one of the lowest in the world for grain.
-We have a medium grain producing country
-Grain is medium priced resulting in medium to high priced food in terms of world markets.
1. Were not looking to sell products of grain or food on the world market, so in turn it doesn’t adversely affect us if our markets are more inflated than others.
2. The valid argument that low skilled workers only make enough to buy food for a day stands, the first solution should be to boost minimum wage and not deflate the grain industry.
3. The second solution in a broad view would be for congress, citizens and the grain companies to find some common ground and move forward to correct the issues. In doing that I promote that we raise the import tax on grain to 20% with some congressional members have suggested in the past few days.
4. Raising the import tax will still allow profitable imports from most legitimate overseas companies while giving domestic companies the edge they need to compete as scoot said in my previous article.
5. We don’t want to look protectionist in nature and keeping the import tax at 20% will keep us from looking that way.
6. A 5% import tax opens the door for a lot of negativity surrounding the situation. It hurts Israel business, ends up laying employees off, lower wages in the grain sector, and eventually stagnant wages in the food sector as grain will be cheap, food will be cheap, food companies will start making profits not seen before and will most likely keep if for themselves and not pass it on to the employees if history repeats itself, and it creates a negative environment for all involved except for the government who will be getting the tax from the importers and the importers and their employees. It also creates grain jobs in other countries which we don’t want to promote as a nation, we need to keep the make it here, buy it here mentality about us to remain successful and unified as a nation.
I ask that those congressmen who are moderate in their views on this really examine the situation from both sides and speak with grain producers, grain employees and listen to the concerns that we have. Don’t just say it is what it is, as that won’t move our nation forward and will move to de-unificate our nation in the long run as a whole. Lets work together to serve everyone’s interest’s not just foreign company Interest’s in the long run.
Those of you who see this as your way or no way will be seen by the nation and will be remembered come next election period and the one after that. Lets make the wrongs right.
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Before we begin. This is not meant to create arguments, strife, or discord. This is meant to hold legitimate talks regarding the situation. I am not a congressman, I am a grain company owner. But as I have said before, I would stand up and preach the same thing if I wasnt a grain company owner, or if this was happening to another industry (it is but I can only tackle 1 at a time in my paper). Lets have a fair honest debate about this. 20% is fair in my view.
The reason I originally proposed the grain tax reduction was simply because grain in Israel is horribly over priced. As it stands right now, our domestic grain is still 3 times more expensive than foreign grain. In all reality, Israeli grain alone is selling for what a finished piece of food sells for in most parts of the world.
It is the unfortunate reality that medium production regions of the world simply can not ever hope to sell product because they produce half that of a high productivity region.
This is why Israeli food is currently so expensive. The magic number for Q1 food is 3/4 that of minimum wage. In our case, that means after taxes, Israeli Q1 food would be selling for .75 NIS. Our grain alone sells for about 25% more.
Now I understand your point about not exporting, however, the least of our worries is exporting anything right now. Also, we tried raising the minimum wage to 2 NIS a day... over night (literally within hours) every single job offer for 0 skilled workers disappeared. Even at 1 NIS, it is completely unprofitable for a company to hire a skill 0 worker. You end up paying them for basically nothing (a skill 1 worker at 40 wellness produces less than 1 unit of food, 1/5th of a weapon or 1/10th of a moving ticket.)
The only way for the Land industry in Israel to sell reasonably priced products and be competitive on a world market is to pay a fraction, and I do mean, a fraction, of what they pay now. In all reality, that means minimum wage up to skill level 5 or higher. I understand this is not a good position for company owners or land workers, but it is regrettably the truth.
I agree with what buzzy the cat has written, in fact I had a post typed up with similar points that disappeared on me.
The ONLY way we can get cheap grain and cheap food is to import it. it sucks that you're going to lose your investment in this, but for the good of eIsrael, grain import taxes need to be as little as possible.
As addendum, my idea that a 20% import tax would suitable was aimed at the finished goods market, not the raw materials market.
all good debate. But like I said there is more than 1 way to look at it.
There is only one way to look at from the perspective of a healthy nation. Unless you're willing to slash the prices of your grain by 2/3rds, domestic grain companies can not provide the necessary prices to keep Q1 bread under the minimum wage. If we raise the minimum wage we would just shift the problem of low skilled workers to being unemployed instead of simply being unable to purchase food. As buzzythecat said, you raise the minimum wage, and 0/1 skilled jobs dry up, because every other company in eIsrael ends up losing money by employing those workers.
Would you really have every other sector of our economy suffer merely so that one small part is made to be competitive?
And we are really glossing over the fact that very few companies buy domestic raw materials anyway. The new company owners might, but in reality, anyone with more than a few hours in a chat room knows that you can buy RMs for 1/4 the price with an Org account and 10 minutes of donation time.
Even well stocked nations like Romania and Indonesia who have high grain regions aren't always competitive on pricing. Every penny of savings I can get, those are pennies I can pass onto the customer and my workers.
Buzzy is 100% right imo.
And stop saying pennis all the time lol, it sounds just wrong xD
You want to ruin everything, because you have a grain company? What a patriot!
It's hard to say whats right as far as grain goes. But higher base wages haven't always worked. Just look at Britian and Ireland, there infastructure is stagnent, I believe.
Very good article, voted up.
It is clear to me that we are reaping what we have sown.
My employer, national grain is going out of business, don't know how long Moore grain will last because they cannot make a profit selling as cheap as international competitors.
We knew this was going to happen and government wanted it to happen. It's up to you as the voter to decide what vision you like.