Parity is a Luddite concept that implies that the American economy should be frozen to provide farmers with the same comparative advantage that their great-grandfathers enjoyed. Parity is also a protectionist concept, based on the idea that government should isolate the American economy in order to boost farm prices. Yet this is what farmers do almost every year. Most of the complaints about unfairly low crop prices in this century have stemmed largely from a refusal to admit that the cost of producing crops has fallen steadily, thereby leading naturally to lower prices. This is a trend that has been proceeding continually for centuries and has been fought tooth and nail by politicians and farm groups for at least a hundred years.
Parity is simply a worship of ancient farm prices.
Even though full-time farmers' income is higher than nonfarmers' income, many farmers claim that they are still victimized because crop prices are lower now in real terms than they were in 1910. But so are prices for most commodities, farm and nonfarm. The only justification for parity nowadays is that farmers are treated unfairly because nonfarmers don't pay as much for farm products as their great-grandfathers paid. And invocation of parity also blinds many people to the fact that most farm products in the United States are not subsidized or controlled by the government. While parity has generally lost respect among agricultural economists, the parity formula is still used by the Agriculture Department and in federal laws to justify restrictions on what farmers can sell or on how farm products can be marketed.