For many, it may seem unrealistic for the protesting rubber farmers, especially those in the South, to demand a guaranteed price of 120 baht per kilogramme from the government while the world rubber price has plunged to 72 baht.
In fact, the government has persistently cited the depressed world market price in rejecting the rubber farmers' demands.
That leads to a question: Why is the government prepared to treat rice farmers so differently? Isn't it a case of double standards?
Yet it is useless to look for sound reasoning from a government that clings to populism and gives different responses to different groups of farmers depending on how it feels on the day.
In saying "no" to rubber farmers, Agriculture Minister Yukol Limlaemthong insisted their demand for 120 baht/kg is not a sustainable solution as it would distort market mechanisms and affect rubber price stability in the long run.
If the government is to help the rubber farmers by giving them a 120 baht/kg guaranteed price, it's expected that it will need no less than 100 billion baht. The amount is calculated from last year's rubber production of 3.77 million tonnes.
Let's look at the rice farmers. The government has over the course of two years injected more than 700 billion baht into the notorious rice-pledging scheme, in which it has promised to subsidise "every grain".
It is expected the budget for the scheme may reach one trillion baht in a year or two while the deficit and scheme management costs may reach 300 billion baht.
The government has tried to convince us there are some differences between rice and rubber farming regarding land use, product processing procedure and market demand.
Interestingly, the Agriculture Ministry says the rubber planters have failed to follow its advice. It says they must add value to their product through processing instead of sticking to making raw rubber and rubber sheets that already flood the market.
Yet the government's attempts to justify its double standards is ridiculous and they are now backfiring.
After years of being pampered, farmers will always look to state assistance first rather than trying to find ways to improve production efficiency and boost product quality and quantity.
They keep running to the government every time they face a price crisis, because the government has encouraged such behaviour.
But I don't think the government can pamper those in the farm sector forever.
In fact, it's time that the farmers _ as well as the government _ leave the comfort zone by paying more attention to farming reform, such as minimising production costs and improving yield quality, and shifting to other kind of produce with brighter prospects.
This could help boost our competitiveness in the world market.
Of course, many in the government might think it's easier to dump money into the troubled sector in which 24 million people produce less than 10% of GDP _ and make short-term political gains while keeping their fingers crossed for the next year's production.
Few governments feel the need to make reforms because they are time-consuming and may not pay off within one term of government.
It is understandable if the government chooses to stay in the comfort zone by providing subsidies to farmers, especially in the rice sector, even if it costs huge amounts of money.
The government's effort to tackle the pledging problem, by capping the subsidy at a maximum of 350,000 baht per family for the main crop, and 300,000 baht for the second crop, will mean little difference as it still requires big money _ no less than 100 billion baht.
We have witnessed many irrational economic policies over the years. A rice-pledging scheme that distorts the market mechanism; the tax rebate for first-car buyers which cost 100 billion baht.
The tax rebate scheme is money that should have been spent instead on improving people's quality of life and the environment, but which instead has gone into creating more related vehicle-related pollution.
All these policies indicate a paucity of ideas among successive governments for boosting public income.
Despite an unstable world economy which has resulted in shrinking exports in the past seven months, Thailand still has some advantages _ high monetary reserves accounting for $170 billion, and public debt at a respectable 44% of GDP _ which still enables the government to use monetary and fiscal policy to stimulate the national economy and improve infrastructure.
But the government should realise that too many irrational policies, aimed at gaining political advantage, can also put the economy at risk.
Wichit Chantanusornsiri is a senior economics reporter, Bangkok Post.
About the author
- Writer: Wichit Chantanusornsiri
Position: Business Reporter